Wholesale potato prices in major Indian mandis have declined sharply in early January 2026, putting pressure on grower margins in key producing regions. In markets such as Pipli in Haryana and Jalandhar in Punjab, prices have fallen below ₹4 per kg, equivalent to about US$0.05 per kg, well below reported production costs.
Growers indicate that input costs average around ₹50,000 per acre, or approximately US$600 per hectare, covering seed, fertilisers, irrigation, and labour. With mandi prices at current levels, sales are failing to cover harvesting expenses, leading many farmers to sell early volumes to private traders to reduce losses.
The price decline is linked to early harvesting, high arrivals following bumper production in states including Uttar Pradesh and West Bengal, and weak domestic demand. Market arrivals have increased rapidly, adding pressure to a system with limited cold storage capacity and ongoing climate-related variability.
Ground reports highlight the financial strain. Darshan Lal, a grower in Kurukshetra district, said: "At Rs 4-5 per kg, we're not even covering our input costs of around Rs 50,000 per acre. Harvesting the crop now costs more than what we get from selling it." Similar conditions are reported across Punjab and Haryana.
Punjab alone accounts for more than 110,000 hectares of potato cultivation. Average yields this season are estimated at 100 to 110 quintals per acre, down from typical levels of 150 to 160 quintals due to erratic weather, including frost impacts in previous seasons. In Haryana, yields are reported at around 26,490 kg per hectare, but heavy mandi arrivals continue to weigh on prices.
Production costs across the region vary between ₹40,000 and ₹90,000 per acre, depending on land leasing, seed volumes of 1 to 1.5 tons per acre, and pest management costs. Farmers in Punjab report production costs of around ₹9 per kg, indicating current market prices are well below break-even levels.
Support mechanisms such as Haryana's Bhavantar Bharpai Yojana offer compensation when prices fall below a protected base price of about ₹6 per kg, or US$0.07 per kg, with payouts capped if prices drop to ₹4. Growers are calling for the base price to be raised to ₹10 per kg, around US$0.12 per kg, to better reflect costs.
India produces more than 50 million tons of potatoes annually, making it the world's second-largest producer. However, repeated price swings are influencing planting decisions, with growers warning that sustained low prices could reduce acreage next season, potentially tightening supply in later cycles.
Source: The Financial World
