Pakistan: Potato prices crash
Prices, which dropped below the reported cost of production before the glut had hit the market, continue to tumble. The price for red skin variety is down from Rs15 per kg in mid-February to Rs11 currently. For white skin potato, they are even lower, ranging between Rs8-9 per kg. This is just more than half the cost of production.
Official efforts of slapping import duty and removing the levy on exports came much late. Export has started gaining some momentum, with over 30,000 tonnes already on the high seas to their foreign destinations. But the crucial question remains: would exports be able to absorb the glut? The answer is no.
The total domestic surplus, according to farmers, might be anywhere between 2.5-3m tonnes. The country has never been able to export more than 100,000 tonnes, and has averaged at around 80,000 tonnes. And these figures were achieved during regional shortages, when crops in winter potato producing countries (Bangladesh and India) had failed.
This year, both these competitors have their own surpluses and would compete with Pakistan for foreign markets’ share.
The total domestic surplus, according to farmers, might be anywhere between 2.5-3m tonnes, and the country has never been able to export more than 100,000 tonnes
Better tuber quality gives Pakistan an edge, but it remains to be seen if this advantage is exploited or not. Thus, in all probability, a huge quantity of the crop would remain within the country.
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