Katalyst :: Potato

Moreover, the problem of wastage is exacerbated by the lack of proper storage facilities; Bangladesh has storage for just approximately 2.1m MT (Karim, 2008).

The international market for processing potatoes is huge. For example, the global market for potato flakes and starch is over USD20 billion and growing by 10% annually (Financial Express, 2008). However, Bangladesh is unable to compete, as aside from issues of suitable varieties and storage facilities, it does not have the necessary processing and distribution services. There is even potential for Bangladesh to export processed potato products, if the industry can develop sufficiently. As a third option, Bangladesh could increase exports of table potatoes. However, there is less room to grow and competition from China and India, whose prices are more competitive, is stiff. Nevertheless, even now, a small quantity of potatoes is exported to Malaysia, Singapore, and Sri Lanka. These countries are close enough to keep shipping costs low, thus making imports from Bangladesh reasonably competitive. In 2006, Bangladesh exported around 7,000 MT of raw potatoes (Karim, 2008).

The major constraints impeding the sector growth, are lack of access to a) quality inputs (e.g. seed, fertilizers); b) information on better farming practices (e.g. disease prevention, pest management, appropriate use of inputs) and storage systems; c) services (e.g. storage, packaging etc.) and d) markets, due to the lack of appropriate varieties.

By 2013, the potato sector in Bangladesh will have expanded into processing and export. A larger proportion will be supplied by small farmers who will have better access to quality inputs, particularly the right seed varieties, and appropriate knowledge and information on the use of improved cultivation practices. The retailers and processors, who understand the value that these goods and services can add to their own businesses, will provide quality inputs and information. Farmers will have links to processors and exporters so they can sell their produce. Supporting services – such as cold storage and finance – will be more appropriate for the sector. These changes will also benefit small farmers growing table potatoes for the domestic market in terms of improving their profitability, and the quality and productivity of potatoes.

Intervention Areas

Improving access to and use of quality inputs

This intervention area addresses one of the most significant constraints within the potato sector: access to inputs, including seeds. By improving the market mechanisms to provide quality inputs, it aims to allow small farmers to access new markets and raise their productivity. Some of the channels for supplying inputs and information already exist and just need to be enhanced or extended, while others need to be established.

Promoting cultivation of industrial varieties

This area focuses on the constraints to farmers adopting industrial varieties of potato, in particular the lack of linkage between farmers and processors/exporters. It would include supporting the processors/exporters in promoting industrial varieties by integrating their backward value chain through introducing innovative models of contract farming, where feasible. The intervention will initially target some innovative processors and/or exporters with the will and the means to take the risk of investing in new business models, and the seed companies who are willing to invest to unlock new market potentials.
Improving post-harvest management

This intervention area addresses the constraints of lack of knowledge and access to services, specifically storage. The aim is to reduce wastage, lower costs, and help increase the profitability of industrial varieties of potato. The key areas of work would be to support cold stores to provide better post-harvest management through upgradation of their technology and skills in dealing with potato (specifically industrial varieties). This does not alter the fact that storage facilities are inadequate and small farmers have limited access to them. Katalyst thus plans to promote a cost effective, natural storage system for potatoes.

Katalyst works with two co-facilitators in the potato sector – GMark Consulting, and Action for Enterprise (AFE). They work in different Katalyst intervention areas, and also liaise with private sector partners such as the Bangladesh Cold Storage Association.