India

Vegetable prices soar as wholesale-retail price gap reaches 80%

By RJ Whitehead

- Last updated on GMT

© iStock
© iStock
Limited distribution of commodity vegetables has translated to substantial price rises, with no improvement in sight, according to an Assocham study.

The report, by the apex industry representative body, found that prices of potatoes, cabbages, chillies, tomatoes, cauliflowers, brinjal and okra have witnessed price rises of 20-100%, hit by low harvest arrivals to mandis ​(wholesale markets) over the April-July period. 

Most worrying is that the trend will remain visible during the peak season of production, Assocham’s comprehensive study on vegetable production noted. 

At a retail level, potato stores more than doubled over this period compared to the same months last year, while cabbage and chilli stocks were up by almost a half. Stores of the all-important tomato and potato crops increased by around 25%.

The study, which surveyed a number of mandis​, said the trend “indicates a worrying situation where market arrivals of vegetables have recorded contraction despite being peak season for production​”. 

In the shorter horizon, there will be more pressure on the market arrivals of vegetables as production season eases​.” 

DS Rawat, secretary-general of Assocham, highlighted the “huge gap​” between retail and wholesale price of vegetables. 

On an all-India average, retailers are selling at more than 52.7% of wholesale prices​,” he said. 

In some cases this gap extends to over 75% for some brinjal and 62% for tomato. In Mumbai, Delhi and Patna, the study found the gap to be well over 50%.  

Lack of basic infrastructure puts further strain on the arrival of vegetables, which results in more wastage of vegetables during peak time of production, and because of their perishable nature producers have to sell immediately​,” the report said. 

The government should improve infrastructure facility by encouraging PPP initiatives for the development of cold storage. Also there is need to develop infrastructure that could be directly accessible to the farmers and bridge the gap between fields and markets​,” it added.

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