Relief for farmers as Centre lowers Bt cotton seed price

Move comes hours after farmers protest in Mumbai for loan waiver and other support

The central government, after a gap of two years, lowered the retail price of genetically modified Bt cotton seed by ~60, to ~740 for a 450g packet. This includes the ‘trait value’ (licence fee) of such seeds for the 2018-19 financial year, cut by ~10.

The current price of Bt cotton is ~800 for a 450g packet, of which ~49 is the ‘trait fee’, including taxes. The latter fee is what seed companies have to pay the licence holder. In this case, global giant Monsanto’s joint venture partner in this country, Mahyco Monsanto

Biotech (MMBL).

The order comes hours after thousands of farmers in Maharashtra protested in Mumbai, demanding loan waivers, compensation and other help.

Cotton is majorly grown in Maharashtra and witnessed low productivity this year, due to pest attack.

A drop in the retail price of Bt cotton seed might impact the profitability of seed companies. They had written to the Centre to raise the prices.

These seed prices were first lowered in 2016 by a panel, constituted by the Centre under the Cotton Seeds Price Control Order of December 2015.

Brought down from ~8301,030 earlier; trait value was lowered about 70 per cent, from ~163 a packet.

The move was followed by a guideline issued in May 2016 that capped the trait value at 10 per cent of the seed sale price. Thereafter, it was lowered periodically.

This was much criticised by multinational seed companies. Monsanto said it would “re-evaluate” all its business in the country, as it took the biggest hit. It had also petitioned against the order at the high court in Delhi.

MMBL has sublicensed Bt cotton seed technology since 2002 to 50- odd domestic companies. The first sublicensing was of BG-1 technology, which went off-patent in 2006. It now sublicenses BG-2 technology.

Seeds produced using this occupy 95 per cent of the Indian cotton market.

A third technology, BG-3, is in the pipeline but the commercial use has not been approved.

Domestic seed companies had alleged MMBL collected ~5.3 billion annually as trait value and since 2002 had taken ~70 billion as licence fee.

The Bt seed market is worth at least ~35 billion a year. The issue divided National Seed Association of India, with multinational companies and some likeminded Indians forming the Federation of Seed Industry Association.

The current price of Bt cotton is ~800 for a 450g packet, of which ~49 is the ‘trait fee’, including taxes