State of the industry

Changing farm preferences causing Indian seeds to sprout

By RJ Whitehead

- Last updated on GMT

Related tags States and territories of india India

Changing farm preferences causing Indian seeds to sprout
India’s seed industry is predicted to be worth Rs10,700 crore by 2015, according to a study by the Association of Chambers of Commerce and Industry (Assocham), corresponding to a 50% increase on the current value.

The market presently stands at Rs7,000 crore, however Assocham’s analysis expects productions levels to grow from about 40m quintals to 63m quintals by the same year. 

The share of the organised seed sector accounts for just over half of the total seed industry at around Rs3,250 crore—the remainder is unorganised with marginal farmers accounting for over 60% of land in India, thereby opting for cheaper seeds.
The states producing the most commercial seeds are Bihar, Haryana, Punjab, Uttar Pradesh and West Bengal in the north and Andhra Pradesh, Karnataka, Tamil Nadu in the south and Gujarat, Madhya Pradesh and Maharashtra in the centre.

Economics behind growth
Factors leading to the growth of the seed industry include the limited availability of agricultural land​,” said DS Rawat, secretary-general of Assocham. 

Moreover, the diverse use of agricultural crops is leading to rising food crop prices, while subsidies by the government to use high-yielding varieties to increase productivity also plays a part. We need robust seeds with vitality to increase the yield from limited acreage, coupled with effective crop management, to boost food security​.”

Rawat added that seed companies need to convince farmers to abandon conventional seeds in favour of high-yielding hybrid seeds. As well as boosting produce, farmers could also expect to fetch better prices for their produce and almost triple their income. Public-private partnerships, a strong regulatory framework are also and collaborate research are also required for the seed industry to grow.

Assocham also revealed that farmers are gradually moving towards hybrids from varietal seeds, although many are still reluctant to do so on account of the cost of hybrids and the inability to reuse them.

Not all dandy

With about a 20% share of the market, cotton accounts for the biggest slice of the hybrid seed market, followed by rice at 15%, and then wheat and vegetables at over 10% each.

Aside from the handful of state seed corporations and the Seed Farm Corporation of India, another 350 private-sector producers and distributors, and 300 trading firms, are present in the market.

These seed companies are often hit by seasonality and monsoon dependence, although Assocham is convinced that these issues can be dealt with through research to develop products for both kharif and rabi seasons.

Also needed is a robust network to provide information on seed performance and improvements, while a proper inventory must be maintained to meet future demand. Crop-rotation is also essential for farmers.

Related topics Markets Industry growth South Asia

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