After an initial euphoria, the prices of red chilli have started tumbling at Asia’s largest chilli yard here. The low prices for medium grade chillies have disappointed farmers, who were hoping to make some good sales as the trading season draws to a close. The price offered for medium grade chilli has slid to about Rs. 9,500 a quintal while the price for higher grades has fallen to Rs.11,000 a quintal for the first time this season.
“I have invested over Rs. 4 lakh on my five-acre farm, but the returns have been extremely disappointing. Owing to successive droughts in 2014 and 2015, the yield has fallen by 40 per cent,” said Venkaiah, a farmer from Pedagarlapadu in Dachepalli mandal.
Officials of the Department of Horticulture, however, attribute the phenomenon to excess arrivals at the chilli yard.
“The dip in prices is due to excess arrivals of chilli. Every day, more than one lakh bags are arriving at the yard, resulting in slackening of demand, but the prices are likely to go up soon as there is demand for quality chilli,’’ said Deputy Director, Department of Horticulture, Jayachandra Reddy.
This was in stark contrast to the initial euphoria, when the famed red chilli commanded a price in excess of Rs.15,000 a quintal this February.
For chilli farmers in Guntur, it has been a double whammy this year as there was a slump in production owing to unfavourable weather. Farmers in the Palnadu region even tried to salvage the crop by digging borewells, but groundwater levels too dipped to an all-time low.
According to estimates, there could be a shortfall of 25.30 lakh bags this season, which could be a major setback to farmers. Failure of both the southwest and northeast monsoons has wiped out any chances of crop revival.
India is among the leading producers of chilli in the world, along with China, Pakistan, and Bangladesh.
Andhra Pradesh accounts for more than 65 per cent of chilli output in the country. Of the 11 lakh tonnes produced in the country, 6.7 lakh tonnes comes from Andhra Pradesh alone.
