The many mirages in Indian agriculture

After a week of harvest and another of preparing the farm plots for next sowing season, here are some quick notes.

1. Farm mechanisation is a serious need. The processes in small scale farming are completely manual. These are limiting the ways in which farmers organize farm processes and their ability to extract efficiencies from the farm. For instance, we harvested about 1.2 tons of groundnuts. The workers who helped harvest it and pluck the pods off the plants took a total of 15% of harvested groundnuts as their wages. There is no way a farm can yield returns at that level of labour cost for just one stage of the cropping process. Then there is post-harvest management that involves labour in cleaning, sun drying for a couple of days, filling up in bags and storing it in the warehouse. All of these are done manually. 
2. Small farm holdings are a challenge in many ways. For a farm holding of less than 2 hectares, there is no way that one can afford to own or even pay for machinery rentals. Land holdings are woefully small which makes leveraging economies of scale a very difficult thing. In fact, there’s no commercial bank in the country right now which will extend a loan to buy a farm tractor for a farmer with a holding of less than 2 hectares. That’s the state of farming on which the planners and thinkers of this country are betting big.
3. Seed sovereignty must be non-negotiable. Of all the times, this idea has come to hit hard in this year of the pandemic. Never have I thought about it with so much regret as now. Indian farming has been made entirely dependent on commercial seeds. Whatever happened to the idea of saving up seeds from a season’s harvest for the next season’s sowing. A direct Covid-19 effect has been on the cost of seeds. Soybean seeds have increased by at least INR 1000 per 30 kg bag. This is outright thieving. The seeds are not certified. Their germination rate is suspect. The companies themselves haev no record of research or rigorous testing.
4. There are very few alternatives to conventional cropping. For a farmer who chooses not to grow cash crops like cotton or oilseeds like soybean, there is literally no option left. These crops see high fluctuation in the international commodities market which then ripples back into local markets. Immediately after harvest, a farmer with a soybean crop to sell can see a swing in prices from INR 3200 to INR 6000 within weeks! This is absolutely crazy and hard to hedge against. For such an outcome, high input costs and weather risk can mean that a farmer can have his annual savings wiped out in just a quarter of the year if it all goes bad. The risk taking ability of a small farmer is not for the weak. It is phenomenally high! If he then decides to not grow cash crops there aren’t many alternatives that are available to the farmer. We thought we will grow chillies this season and ditch soybeans. For planting it takes about 7000 plants per acre of chillies. The farmer’s nursery sells sapings at INR 1 per sapling. At that cost it makes INR 7000 per acre for growing chillies. This is just the sapling cost. Input cost would take labour costs of planting, transport, soil preparation etc.
5.  Agriculture cannot lead post-Covid recovery. That agriculture will lead India’s post-Covid economic recovery is a laughable idea. It looked good until the early days of the first wave of Coviid-19 last year. In the midst of a devastating second wave, reality is that agriculture is bleeding from a thousand cuts. Wages are depressed. Far too many people in rural areas are out of work because there was a substantial non-farm sector. The needs are far too high. At the root of all of this is a significant erosion of household income. Where will small and marginal farmers get the money to invest in inputs and sowing for the season ahead? A good crop also needs expenditure on soil preparation, manure, a couple of rounds of turning and aeration. A typical rotavator job on a farm costs INR 700 per acre. 

Farming as a profession provides the farmer and the household a couple of solid, high quality things – food security, nutrition (vegetables) and a safe and health lifestyle. But that is all. This is where it stops. The returns are often too meagre for a household to think of being comfortable with their material needs and hope to save some money for their future.

It comes as a rather depressing note today because I am appalled by the state of affairs with seeds. There was no reason for seed prices to go up. The ministry bureaucrats, corporate executives and their ilk radiate all kinds of intelligence about agriculture-led growth and agriculture-backed economic recovery and similar nonsense. These are the mirages in agriculture. The reality is far from it. Agriculture in this country is inefficient, sub-optimal and woefully short on critical knowledge, research, investment and skills.