Wholesale Vegetable Prices Fall Sharply by up to 60% During Covid-19 Lockdown, Retail Rates Unchanged

Wholesale prices of tomato, onion and other key seasonal vegetables have declined sharply by up to 60 per cent across the country, mainly due to higher production, compression of demand and market disruption amid COVID-19 crisis. However, the retail prices of most vegetables remain firm.

According to data maintained by AGMARKNET under the Union Agriculture Ministry, wholesale tomato prices were ruling below Rs 5 per kg in some states on May 24, while that of onion to Rs 6 per kg in the key producing state of Maharashtra. However, potato prices were stable at 12-13 per kg.

Tomato, onion and potato are three key largely consuming vegetables in the country. The falling price trend was also seen in other vegetables such as ladies finger, capsicum, bitter gourd, bottle gourd, chillies and coriander leaves, among others.

"It is a matter of concern that farmers are forced to sell at such low prices," said government think-tank Niti Aayog member Ramesh Chand, adding the fall in rates is due to an increase in arrival due to better crop production, besides mandi disruption in the wake of COVID-19 pandemic.

Chand, however, ruled out the impact of lack of demand from bulk users like hotels and restaurants.

Since mandis come under the purview of states, the Niti Aayog member said they should step up efforts to ensure smooth functioning of wholesale markets. If they are not able to operate due to social distancing and COVID-19 reasons, other arrangements should be made to ensure farmers do not suffer.

"Mandis are not working as usual. Maybe traders are not coming to markets. For instance Azadpur mandi in Delhi was closed for a few days due to COVID-19 reasons. There is impact on prices due to such disruptions," he said.

Chand said he had suggested states in the beginning of COVID-19 crisis to suspend mandis for six months which not many states have done yet. Farmers should have been allowed to sell directly.

Stating that demand for vegetables has compressed in this crisis period, agri-economist Ashok Gulati said the demand from bulk users like hotels and restaurants is missing. Even households are not buying in huge quantities because of fear of infection.

"After reports of traders in some mandis had got infected with the virus, there is fear among household consumers about the quality of vegetables. They find cleaning it everytime is a big hassle and therefore shifting to pulses, whose prices have shot up sharply due to rise in demand," he said.

Gulati said it is sad to see the government's TOP scheme under Operation Green has not been of much help to farmers in this situation. The government has spent only Rs 3 crore out of Rs 500 crore since its launch two years ago under the plan, whose objective is to help tomato, onion and potato (TOP) farmers in times of surplus output.

According to AGMARKNET data, all-India average wholesale rate of tomato dropped by 60 per cent to Rs 11 per kg on May 24 from Rs 27.50 per kg a year ago. Prices have fallen in 19 states but a sharp fall of up to 83 per cent was seen in Telangana, Karnataka, Andhra Pradesh and Maharashtra.

In Telangana, prices declined by 83 per cent to Rs 4.69 per kg on May 24 from over Rs 27 per kg a year ago, while prices in Karnataka slipped by 80.76 per cent to Rs 4.41 per kg from Rs 23 per kg.

In Andhra Pradesh, prices dropped by 75.48 per cent to Rs 4.88 per kg from Rs 20 per kg. The wholesale prices of onion declined mainly in three states -- Maharashtra, Karnataka and Delhi.

In Maharashtra, the wholesale rates fell by over 27 per cent to little over Rs 6 per kg on May 24 this year from Rs 9 per kg a year ago, while in Karnataka rates fell by 17 per cent to Rs 8 per kg from Rs 9.50 per kg.

The wholesale rate of potato, however, rose 44 per cent to Rs 18 per kg on May 24 from Rs 12.50 per kg a year ago. In Uttar Pradesh, it jumped two-fold to little over Rs 16 per kg. In Delhi too, rates have almost doubled to Rs 15 per kg.

The wholesale prices of chili capsicum declined by up to 54 per cent in the key markets. In Karnataka, the rates fell by 53.67 per cent to Rs 20.65 per kg on May 24 from Rs 44.58 per kg. In Maharashtra, prices declined by 31 per cent to Rs 20 per kg from 24.50 per kg.

In case of ladies finger (bhindi), the all India average prices declined by 20 per cent to Rs 17.50 per kg on May 24 from Rs 22 per kg a year go. Prices have fallen in as many as 14 states.

In Chhattisgarh, rates have dropped by 57 per cent to Rs 4 per kg from Rs 9 per kg, while in Gujarat, it slipped 45 per cent to little over Rs 10 per kg from over Rs 18 per kg.

Similarly, the all-India average price of bitter gourd fell 19 per cent to little over Rs 22 per kg from Rs 27.50 per kg. Prices have fallen in 15 states.

That apart, all-India average wholesale price of bottle gourd fell by 16.35 per cent to Rs 10 per kg on May 24 from Rs 12 per kg a year ago. Prices have fallen in 12 states.

Prices of beans fell mainly in Karnataka, Odisha and Maharashtra. Maximum fall was seen in Odisha where the wholesale price fell by 35.43 per cent to Rs 24 per kg from Rs 37 per kg. In Karnataka, it dropped by 11 per cent to little over Rs 43 per kg from 49 per kg.

Even prices of coriander leaves and green chilies showed a declining trend, as per the AGMARKNET.