Pepsi extends potato contract farming net

Notwithstanding the opposition against contract farming in West Bengal, PepsiCo is beefing up direct potato procurement for its FritoLay division from the state.

It aimed to procure 12,000 ton of potato from 1,600 acre from about 1,800 odd farmers in six districts of West Bengal this fiscal.

The company was trying to procure potato through contract farming from Jharkhand and Bihar and process upto 30,000 ton of potato at its Sankrail factory in West Bengal by 2010.

"Trials for potato contract farming have started in Jharkhand and can provide potato during lean seasons also," said Nishchint Bhatia, executive vice president-agro, PeppsiCo (FritoLay division), here.

PepsiCo would help growers combat late blight disease, which wrecked the potato crop last year.

It tied up with institutions like State Bank of India for soft loans to contract farmers, and ICICI Lombard for weather insurance.

Pepsico and Central Potato Research Institute were collaborating on ways to fight blight.

Pepsico's late blight package this year involved changes in crop agronomy, chemical treatment, prophylactic spraying and crop supervision by experts, which could save about 95 per cent of the crop.

About half of its revenue in processed food was from potato-based items.

"West Bengal can supply potato-based processed food to the country, and we are taking ahead contract farming initiatives here," said Bhatia.

The six districts under the PepsiCo blight management plan were Bankura, Barddhaman, Hooghly, Medinipore, Howrah and Birbhum.

The average package cost per acre of potato crop was Rs 25,000.

Pepsico was working on oat-based processed foods too from a dedicated unit for oats processing, but plans were yet to be finalized.

It recently started oat contract farming in Punjab, Karnataka and Rajasthan.

"The plant should be near the oat-producing area," said Bhatia.