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Regaining lost potato export market

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16th-Apr-2017       Readers ( 160 )   0 Comments
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POTATO exports have remained low ever since Russia barred the entry of the vegetable in May 2015 on food safety grounds after detecting some diseased consignments. Prior to the ban, shipment of the tuber had hit a record high of about 1 lakh ton in 2013-14, spurred by the demand from Russia.

Since July last year, about 30,000 tonnes of potato were shipped, with the total exports expected to be 35,000-40,000 tonnes at the end of the fiscal year, said officials of Plant Quarantine Wing under the Department of Agricultural Extension (DAE). Last fiscal year, potato exports slumped 58 percent to 37,270 tonnes -- a direct manifestation of the embargo from Russia.

The lack of availability of export-quality potato has dampened the prospect of increased exports this fiscal year, as per a report of a local daily. The quality of a large quantity of potato has deteriorated due to rainfall during the harvesting period. Farmers planted potato on 5.28 lakh hectares this fiscal year, up 11.16 percent year-on-year basis. Production grew 19 percent year-on-year to 1.13 crore tonnes this fiscal year, according to DAE estimates.

Exporters are also finding it tough to compete with their peers from other countries. In Dhaka, the tuber sold at Tk 15-20 a kilogram yesterday, up 25 percent from a month ago, according to Trading Corporation of Bangladesh. The shipment of the tuber this fiscal year would have been higher had the government not halved the cash incentive for potato export to 10 percent from this year.

Malaysia is the main destination for locally grown potatoes. The tuber is also sent to Singapore, the Middle East, Sri Lanka and Vietnam, according to exporters and government officials. Exporters here have to compete with Pakistan, China and India in the export destinations, mainly Malaysia.

Increased incentives for export will make exporters more price competitive and help ship higher quantity of potatoes. But these should not be cash incentives as subsidies always have an opportunity cost in terms of welfare losses. What Bangladesh needs right now are cold storage facilities in every potato growing area to ensure that disease of the tubers are minimized. More than anything, it will go a long way to ensure that our potatoes remain free from blight and are stored safely. This will ensure that we regain the markets we have lost.

Anything which decreases production costs can also be looked into. Research and development into high yield disease free tubers are yet another way we can regain the lost export competitiveness. Our farmers are hardworking enough --anything which can give them an upper hand should be looked into to ensure that we can also earn foreign currency from agricultural exports. This will enable us to diversify away from garments, and other areas like ICT development to help with potato farming can also be considered.

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