Seed market grows, led by private firms

The seed market is growing due to massive marketing campaigns by private companies and farmers' switch to commercial farming for higher incomes, operators said.

The market of quality seeds, supplied by public and private sectors, stood at 2.67 lakh tonnes in fiscal 2012-13, though the amount was around one lakh tonnes a decade ago, according to data from the agriculture ministry.

Industry insiders said the market grows by more than 10 percent a year with the share of the private sector rising gradually.

"Farmers are shifting from subsistence farming to commercial agriculture. It is one of the main reasons behind the growth of the market," said Asadul Amin Dadan, general secretary of Bangladesh Seed Association, a trade body of 180 members.

Dadan said the private sector mainly contributes to the growth of the overall seed market worth more than Tk 1,000 crore now.

The market began to grow gradually after the government had allowed the private sector to import and sell hybrid seeds in 1998 to boost food production.

Since then many private businesses signed up for the trade as farmers were highly dependent on low-quality seeds that were collected either from informal market or preserved by themselves.

Agriculturists and seed businesses say good seeds can increase crop yields by up to 20 percent.

Now private and public sectors together supply 20 percent of the demand for seeds.

Nearly a decade ago, the supply of seeds by private firms and state-run Bangladesh Agricultural Development Corporation (BADC) was only 12 percent of the total requirements, according to the agriculture ministry.

FH Ansarey, executive director of the agribusiness division of ACI Ltd, a private firm, said the overall market for seeds grows 12 percent a year now.

"Farmers are getting the results of using quality seeds. They are getting better yields as they can also grow winter vegetables off season," Ansarey said.

Growing consumption of vegetables and a sharp rise in the number of dealers amid massive marketing by some companies also buoyed the seed market, he said. "Some seed companies are also operating in remote areas."

Mohammad Masum, chairman of Supreme Seed Company, said the entry of some private companies facilitated the market growth. Old companies have also increased their activities, he said.

Now, apart from BADC, more than 100 firms, including some non-governmental organisations, sell seeds, mainly hybrids of rice, maize, vegetables and spice, through 18,000 registered dealers.

"The overall demand for quality seed has also increased," he said. The share of the private sector in seed supply rose to 34 percent in fiscal 2012-13 from 23 percent in the previous year and only 11 percent in 2005-06, according to the agriculture ministry.

Private seed companies and traders have more than 90 percent stakes in the hybrid segment of seeds for maize, vegetables and spices mainly because of the expansion of hybrid cultivation.

The private firms also raised their share in rice seed trade. The sector supplied 24 percent of the total demand for rice seeds in fiscal 2012-13, up from only 4.31 percent in 2005-06.