Government keeps Bt cotton seed prices unchanged

By: | Published: March 17, 2017 3:24 AM

Maximum sale price retained at R800 per 450 grams, royalty fee to tech developers stays at R49 per packet

An official who attended the meeting of a committee set up by agriculture ministry, said that status quo was maintained on the license fee, which includes royalty or trait value, as well. (Reuters)

The agriculture ministry has decided to retain last year’s maximum sale price (MSP) for genetically modified Bt cotton seeds for the 2017-18 kharif season.According to a notification issued by the ministry, the farmers would continue to get widely used Bollgard-II variety of Bt cotton seeds at R800 per 450 gram packet in next the kharif season.

An official who attended the meeting of a committee set up by agriculture ministry, said that status quo was maintained on the license fee, which includes royalty or trait value, as well. The committee was set up last year to recommend MSP of cotton seeds after taking into consideration the components of seed value. The MSP decided by the committee includes a trait or royalty fee of R49 per packet paid by the seed companies to the technology developer.

Last year, MSP of Bollgard – II Bt cotton seeds was reduced sharply to R800 per 450 gram packet from R830-1,000 in the previous year. However the sharpest cut was on royalty or trait fees which was reduced by 74%, from R163 per packet to R49 after taxes.

After last year’s cut in the fees to Mahyco Monsanto Biotech (MMBL), which sub-licenses Bt cotton seed technology to various domestic seed companies since 2002, the trait value has been just 6% of the pan-India ceiling price of R800 per packet for the seed.

MMBL, a joint venture between the US-based biotech major Monsanto and Maharashtra-based Mahyco, had then moved the Delhi High Court against the reduction in trait value and the capping of the seed price. It argued that the December 2015 price control order was ‘illegal and unconstitutional’. The court is yet to decide on the matter.

About 83% of the country’s cotton area of 10.2 million hectares (in the 2016-17 season) was under Bt variety. The country’s cotton production has risen manifold since the introduction of Bt seeds — from 13.6 million bales in 2002-03 to a projected 32.51 million bales in 2016-17.

After Bt cotton was introduced in India in 2003, it took no time for it to take the lion’s share of the country’s cotton area, but 2016-17 saw the first steep decline in its attraction to the domestic growers. Primarily because cotton farmers in Punjab and Haryana took to native varieties in last year’s kharif season.

Farmers thought these might be less vulnerable to the deadly pest white fly than the genetically modified one. The share of Bt variety in total cotton area sown declined to 83% in 2016-17 from 91% in the previous season.

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