Currently a 100 kg potato bag will cost Rs.320-340 in Tarakeshwer, Hooghly of West Bengal. This is the ex-cold storage price. But Potato-Tarakeshwer Futures is getting traded at Rs.408 for 15th April expiry. The 15th May Potato-Tarakeshwer Futures is trading at Rs. 471. So the potato farmers can not expect that much of profit after taking out the potato bags from Cold Storage and sell in retail/wholesale market.
The potato bags do weight 50 kgs and after sorting,loading,unloading,cold-storage rent and rejecting(due to weight loss in cold storage), the farmers has to pay a lumpsum of Rs.87 per 50 kg bag. So a 100kg bag will have operating cost of around Rs.174.Now the making production cost of 50kg potato bag will be some around of Rs.150 including fertilizers, bag cost, loading and unloading, water, pesticides etc. So the farmer has to sell a 100 kg potato bag atleast Rs.[300(150*2)+174]=Rs.474 so that they will get the production cost.
Potato Farmers in West Bengal has also taken loans from Brokers and Banks which give them high and low rate of interest. So the interest cost will also add to this price. Hence profit booking will be very marginal unless Potato-Tarakeshwer Futures will trade at Rs.500+ range.
Potato production is hampered in northern Uttar Pradesh and Bihar region due to fog and improper water distribution from the irrigation department. Evn potato production is low in the south-eastern sectors of West Bengal. Now the distributors and the middle man has created a market for why the potato farmers are not getting the real price for their efforts.
My prediction is to buy Potato-Tarakeswer Futures as there are less production and potato are going out of Tarakeswer mokam everyday by trucks and rail wagons.
The potato bags do weight 50 kgs and after sorting,loading,unloading,cold-storage rent and rejecting(due to weight loss in cold storage), the farmers has to pay a lumpsum of Rs.87 per 50 kg bag. So a 100kg bag will have operating cost of around Rs.174.Now the making production cost of 50kg potato bag will be some around of Rs.150 including fertilizers, bag cost, loading and unloading, water, pesticides etc. So the farmer has to sell a 100 kg potato bag atleast Rs.[300(150*2)+174]=Rs.474 so that they will get the production cost.
Potato Farmers in West Bengal has also taken loans from Brokers and Banks which give them high and low rate of interest. So the interest cost will also add to this price. Hence profit booking will be very marginal unless Potato-Tarakeshwer Futures will trade at Rs.500+ range.
Potato production is hampered in northern Uttar Pradesh and Bihar region due to fog and improper water distribution from the irrigation department. Evn potato production is low in the south-eastern sectors of West Bengal. Now the distributors and the middle man has created a market for why the potato farmers are not getting the real price for their efforts.
My prediction is to buy Potato-Tarakeswer Futures as there are less production and potato are going out of Tarakeswer mokam everyday by trucks and rail wagons.
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