Cotton: from cash crop to crash crop

Around 15 years ago, Shivaji Chavhal was able to cultivate an acre of cotton for Rs. 4,500-5,000. The pesticides, fertilisers and seeds used to cost less than half of what they cost now. Daily wages of agricultural labourers have also more than doubled. Electricity costs too have risen.

Prabhakar’s 15-member joint family, including his uncle Shivaji, owns about 30 acres of farmland, of which 15 acres used to be reserved for cotton. They have reduced it to 7-8 acres over the past four years, replacing the cotton with food crops like tur, moong, urad and soyabean.

Cotton is a thirsty crop, requiring much more water than food crops. Four years of drought from 2012-2015 in Marathwada played havoc with cotton yields. This year, too, the rains have been inconsistent. The dry years have forced farmers to spend more on irrigation – by drilling borewells, purchasing water tankers, or digging wells.

The price of cotton though, has not gone up in the same proportion. “The market rate for cotton was around 2,000 per quintal [15 years ago],” says Chavhal. “Eight quintals of produce on an acre meant 16,000 rupees. The profit was about 11,000 back then – just 3,000 rupees less than what we now make, 15 years later."

The low price is due to various factors, including the government’s refusal to consider the rising input costs when fixing the minimum support price (MSP) for the crop. Another reason, says Vijay Javandiya, veteran farm leader, is that the price of cotton in the international market is heavily subsidised for the American cotton grower, which negatively influences a fluctuating domestic rate in India. “Also, though both sugarcane and cotton are cash crops, different yardsticks are applied to them,”  he says. “When there is a glut in the market, sugar is exported with subsidies so it does not affect the prices so much. There are no subsidies to export cotton. Similarly, there is 50 per cent import duty on sugar, while there is no import duty on cotton."

“Look at all the expenses today,” Chavhal adds. “They have drastically gone up. Look at the growth in salaries of the working class [such as teachers, government employees or bank officials]. And compare that with our graph. Is it fair?”

While cotton farmers are being squeezed between mounting costs and stagnant returns, a single medical emergency, a marriage in the family, or even the added cost of school fees can force them to apply for a bank loan. Or, worse, approach a private moneylender, who typically charges an exorbitant 5 per cent interest per month.

Prabhakar Chavhal paid for the weddings of his two sisters in part from a Rs. 8 lakhs bank loan, most of it taken during the 2012-15 drought years; some of this money  also helped the family manage during the lean years. But since the recent state government loan waiver has a cut-off limit of Rs. 1.5 lakhs, Prabhakar’s family is not eligible for a waiver. “I do not have a loan with the private moneylender,” he says. “But for how long will that last?”  

In 2006, the Swaminathan Commission, which was set up on the directive of the Congress government to assess the farm crisis and come up with solutions, submitted its report. One of its major suggestions was that the central government provide an MSP to farmers that would add up to the cost of production plus 50 per cent. But the government did nothing. In 2014, the opposition Bharatiya Janata Party campaigned vigorously in agrarian areas, promising to enforce the report, but after coming to power has not implemented the report’s recommendations.

Asaram Lomte, a senior journalist and Sahitya Akademi award-winner based in Parbhani, says for farmers used to cultivating cotton, alternatives such as tur or soyabean  aren’t promising either because these crops too are not being given a fair MSP, and returns on such food crops are anyway relatively low.

Besides, even BT Cotton, a genetically modified variety engineered for resistance to the bollworm, which was introduced to India around 15 years ago, now requires pesticides. “Before BT, farmers spent quite a bit on pesticides,” says Lomte. “From the year 2000 onwards, that reduced considerably. However, BT performed well for merely 4-5 years. Since then, farmers have been compelled to spray pesticides to prevent deterioration, and it has again increased their production costs.”