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Seed industry in India likely to reach Rs 10700 crore by 2015: Assocham
Tuesday, 11 December, 2012, 08 : 00 AM [IST]
Our Bureau, Mumbai
Growing at a compounded annual growth rate (CAGR) of about 15 per cent, the seed industry in India is likely to reach Rs 10,700 crore mark by 2015 from the current level of about Rs 7,000 crore, according to an ASSOCHAM analysis.

Besides, the production levels of seeds in India are likely to grow from the current level of about 40 million quintals to about 63 million quintals by 2015, according to a sector-specific analysis on ‘The Future of Indian Seed Industry,’ by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

The share of organised sector is just over half of the total seed industry at about Rs 3,250 crore while the unorganised sector accounts for the remaining as the marginal farmers comprise over 60 per cent of land owners in India and hence opt for cheaper seeds considering the cost of quality seeds is relatively higher.

Andhra Pradesh, Bihar, Gujarat, Haryana, Karnataka, Madhya Pradesh, Maharashtra, Punjab, Tamil Nadu, Uttar Pradesh and West Bengal are leading commercial seeds producing states in India.

“Limited availability of agricultural land, diverse use of agricultural crops leading to rising food crop prices, subsidies by the government to use high-yielding varieties to increase productivity and other multiple factors are driving the growth of Indian seed industry as robust seeds with vitality to increase the yield from the limited area under acreage coupled with effective crop management is need of the hour to ensure food security in India,” said D S Rawat, secretary-general, ASSOCHAM, while releasing the chamber’s analysis.

“The seed companies are required to convince farmers to abandon conventional seeds in favour of high-yielding hybrid seeds as the switch can help the farmers get high yields, fetch better prices for their produce and almost triple their income,” said Rawat. “Besides, public private partnership (PPP) together with a strong regulatory framework and collaborative research are other key measures to ensure smooth growth of the seed industry.”

The global industry for seeds is likely to cross $71 billion by 2015 from the current level of about $60 billion.

The ASSOCHAM analysis revealed that farmers were gradually shedding the inhibitions about hybrids and shifting to the same as yields from varietal seeds were falling significantly but many were still reluctant as hybrids were not only expensive but also couldn’t be reused.

Cotton, corn, pearl millets, mustard and rapeseed, rice, sorghum, sunflower and vegetable hybrid seeds are gaining acceptance and this trend is being borne out of the variation in revenue composition of private sector seed companies.

With about 20 per cent share, cotton is the biggest component in the hybrid seed market followed by rice (15 per cent), wheat and vegetables (over 10 per cent each).

While there are a handful of state seed corporations and Seed Farm Corporation of India, engaged in production, distribution and marketing of high volume low value public varieties, there are about 350 private sector producers and distributors and about 300 trading firms.

Seasonality factors and risks arising out of dependence on monsoon are certain key challenges faced by the seed companies which can surely be dealt with through strong research and development and products for both kharif and rabi seasons. Besides, there is also need to use proper technology to develop products suiting evolving disease profiles and climatic conditions.

A robust distribution network providing information on seed performance and improvements is required to gain greater acceptability. Besides, a proper inventory must be maintained to meet the future demand and crop-rotation must be done to retain the customers.

Further, the growth of seed industry would depend upon the development and adoption of innovative technologies.

Advanta India, Ganga Kaveri, JK, Mahyco, Monsanto India, Namdhari, Nuziveedu, Pioneer, Proagro, Rasi and Syngenta are certain leading players with major market share in the Indian seeds market.
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