After surge, prices of some vegetables have fallen below output cost, complain farmers.
Prices of vegetables have declined sharply over the past month across the country due to a sudden spurt in arrivals of late-variety crops, after unseasonal rainfall in November damaged early pods heavily. Prices are down sharply in wholesale markets but less in the retail ones.
However, farmers are crying foul that the government’s intermittent intervention to curb agricultural commodities have brought vegetable prices below the cost of production in wholesale mandis. So, traders fear many growers may switch to other remunerative crops next season if price levels remain where they are, which may worsen the condition next year.
| FREE FALL PRICES AS ON (Rs/10 kg) | ||||
| Item | 15-Jan-11 | 15-Feb-11 | ||
| Low | High | Low | High | |
| Lady’s fingers | 300 | 320 | 180 | 200 |
| Cauliflower | 40 | 60 | 20 | 40 |
| Cabbage | 60 | 90 | 20 | 40 |
| Padwal | 120 | 160 | 80 | 140 |
| Cucumber No 1 | 360 | 400 | 200 | 240 |
| Tomato No.1 | 300 | 320 | 50 | 70 |
| Tomato No 2 | 160 | 200 | 30 | 40 |
| Carrot | 80 | 100 | 60 | 80 |
| Chilli (Dhobli) | 120 | 180 | 80 | 140 |
| Brinjal | 160 | 170 | 20 | 30 |
| Capsicum | 280 | 300 | 100 | 120 |
| Golden beans | 300 | 320 | 170 | 180 |
| Bitter guard | 200 | 220 | 140 | 150 |
| Beat | 70 | 80 | 50 | 55 |
| Onion | 400 | 500 | 120 | 140 |
| Potato | 90 | 100 | 70 | 80 |
| Source : APMC and traders, Vashi | ||||
For example, cauliflower was selling at Rs 2 per kg in the Agriculture Produce Market Committee (APMC) market at Vashi, Navi Mumbai, today. With higher seed, fertiliser and insecticide cost, the cost of production today is Rs 4-5 a kg. Also, direct sales from farms to large retailers such as Reliance Fresh and Big Bazaar is happening on a larger scale. Therefore, sales through mandis have declined steeply over a period of time, said Suryakant Dhawale, a cauliflower trader in Vashi.
According to Anil Malhotra, member, market committee, at the Azadpur wholesale vegetable market at New Delhi: “If the prices drop further, it would be unviable for farmers. Vegetables like cauliflower (Re 1 a kg) and potato (Rs 1.50 a kg) are being sold at a price which does not even cover the cost for farmers. If the trend continues, farmers will be dissuaded from growing these crops."
He added that with the season for potato harvest round the corner, a bumper crop may pull down prices further.
More From This Section
Alternatively, if the rain continues for a few days it may hamper the digging of the potato crop and may dampen supply, pushing up prices.
Traders say another reason for the price decline is short shelf life of most agri products.
Retailers know that traders sitting in APMC mandis can’t hold on to their stocks for long will sell everything they brought from various centres, they wait and negotiate the price to the bare minimum level, said Samir Inamdar, a bhindi trader at the Vashi APMC.
Suresh Salunkhe, deputy secretary of the APMC there, feels vegetable prices won’t fall further. Prices are unlikely to go up either until supply from Gujarat restricts, which is expected only by the first fortnight of March. Hence, vegetable prices will remain rangebound for the next one month, he added.
Wider daily fluctuations in prices have made life tougher for retailers, who currently buy enough for their daily sales. Apparently, local administrative authorities near APMCs have restrained small retailers from spreading close to the mandis and near local consumer centers.
Therefore, small retailers buy in low quantity. But, due to high transportation and their own trade margin, they sell at high prices, said Sanjay Prahlad Urade, a capsicum trader in Vashi.
An example is onions, whose prices had earlier gone through the roof. These are now Rs 10-12 a kg in wholesale markets. But retailers are selling at Rs 20-25 a kg.
Farmers, however, have explored unique model of malpractice to protect their margin especially in cauliflower. They fill leaves inside the bag which is not allowed to open until transaction between stockist and retailer is completed in mandis. Generally, retailers who open the sealed bag in their shop area, find that the bag contains over 40-50 per cent of green cauliflower leaves.
Stockists pass bucks in these cases on to farmers while, retailers sell cauliflower at higher price after considering the price they pay to stockists. This unique practice is widely spread across all green vegetables with spoiled goods packed inside the bag. This increases the cost of actual goods in the proportion of spoilage infused inside, said a veteran trader.
Commodities like bitter gourd, cluster beans, brinjal, french beans and beet root have also fallen severely in the last one month.