The Andhra Pradesh government is expected to take a call on increasing the maximum retail price ( MRP) of Bt cotton seed, as requested by the seed companies, in 2-3 days, according to company sources.
Agriculture Commissioner Sunil Sharma, who held a second round of meeting, this time with all the stakeholders including seed companies, farmers’ associations and the technology provider Mahyco Monsanto, to elicit their views on the matter, informed the companies that the government would take a decision in 2-3 days.
“We have submitted the details pertaining to the cost of production of Bt cotton seed to the commissioner as has been requested in the last meeting. The same was circulated among all the stakeholders at the meeting,” P Sateesh Kumar, secretary of Seedsmen Association of Andhra Pradesh told Business Standard.
The companies have been asking the government to revise the MRP of BG1 and BG 2 to Rs 850 and Rs 1050 per packet (450 grams) from the present Rs 650 and Rs 750, which are in force from the year 2008 onwards, in view of the increased costs involving procurement, labour, transportation and packaging among other things.
Though farmers associations were agreeable to the increase in prices based on production cost, they have been insisting on reducing the royalty charged by Mahyco Monsanto before fixing up the final price.
Last year the state government had unilaterally reduced the royalty to Rs 90 from Rs 160 per packet, while the same had been subsequently struck by Andhra Pradesh High Court stating that the government had no jurisdiction in determining the trait value. The technology provider has not been willing to reduce its royalty.
State government's decision on price issue has assumed critical importance for the seed companies as Gujarat and Maharashtra, the first and second largest cotton growing states in the country had made it clear that they would only follow AP model when it comes to Bt cotton price. As AP comes third in terms of cotton production, these three states hold key to a large chunk of Bt cotton seed market in the country.
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Haryana and Punjab have already increased the prices of BG 1 and BG 2 varieties to Rs 825 and Rs 1,000 per packet respectively for next Kharif season.
The companies are pressing for an early decision as they have to position the seed stocks with the revised MRP across these states across these three important markets.