A kilo of tomato is fetching as little Rs. 2 for farmers, while it is being sold at Rs. 4 to Rs. 8 in the retail market in Bengaluru. Compare this with prices just a month ago, when tomato was retailing at Rs. 30 a kg. While a good yield over the last one month has normalised supply, tomato growers have now been affected by the post- demonetisation cash crunch.
Farmers low on cash are at a loss to fund the transportation of tomato and other vegetables to States such as Andhra Pradesh and Tamil Nadu, and in case of tomato, even to Kolkata.
“Supply of tomatoes to Tamil Nadu was affected during the Cauvery crisis. Now there is cash crunch, and transportation has been hit,” said N.N. Sriram, a tomato grower from Nukkanahalli in Kolar disitrct, and added that farmers were suffering huge losses.
Vegetable prices have also been crashing: a kg of beans is now selling at Rs. 14, onion at Rs. 16 and potato at Rs. 26. The prices took a hit over the last two weeks. This is despite the fact that November and December usually see vegetables retailing at higher prices in Bengaluru.
“The prices have come down by over 30 per cent in the last week alone,” said a senior official heading the vegetable procurement section in a leading retail chain.
Keshav S.H., manager, Marketing, Hopcoms, said that another reason for the falling prices has been falling retail sales, indicating lower consumption of vegetables, creating a high supply and low demand cycle.
However, procurement officials fear that the supply-demand cycle may soon be reversed if the cash crunch continues for a longer period, affecting crop patterns.
“Now, vegetable growers are resorting to distress sale. But they are not being paid for their produce immediately, further worsening the cash crunch. If this affects sowing this season, then we will soon stare at low supplies and skyrocketing prices,” the official said.
Farmers low on cash are at a loss to fund the transportation of tomato and other vegetables to markets
