India: Rains hit supplies, hike vegetable prices

The recent monsoon rains in most parts of the country have pushed up the cost of daily food basket, which incidentally has shown little signs of relenting in the last one year.

Latest data from the National Horticulture Board (NHB), which tracks the daily arrivals and price movement of major fruits and vegetables across major cities shows that the rains have severely hampered the supply of fresh vegetables from the producing centre to the markets.

The increase in diesel prices and subsequent hike in freight rates has also pushed up transportation cost for intra-state and intra-district movement of vegetables from one market to another.

Prices of tomatoes one of the most commonly consumed commodities across the country has almost doubled in July as compared to the same period last year.

In Delhi, the average retail price of tomatoes has jumped by more than Rs 3 per kilogram to almost 32 per kg.

This is around Rs 10 per kg more than the average price of tomatoes during the same time last year. Infact, in some places in Delhi, tomatoes are selling at almost Rs 60 per kg.

The big culprit here is the supplies. Average daily arrival of tomatoes dropped by around 32% in July in Delhi, pushing up prices sharply. Similarly, is the case in other cities as well.

In Chennai, supplies of tomatoes have dropped from an average of 5,950 tonne to around 3,300 tonne from last year, pushing up the average retail price by almost double as compared to the same in 2009. In Mumbai, too, supplies of tomatoes have dropped by 32% as compared to July 2009.

Tomato prices are up because supplies were disrupted due to floods in Punjab and Haryana.

However, there is no cause for concern as prices would fall because of improvement in flood situation," Bijay Kumar, managing director, National Horticulture Board told FE.

Similar is the situation of other major vegetables. In Bangalore, average retail price of peas is almost 34% more than the same time last year as daily supplies in mandis have dropped by a third to 109 tonne.

In Delhi, retail price of peas is almost Rs 8 per kg more than the same period last year and supplies in July are down by 41%.

Cauliflower prices in West Bengal are almost Rs 6 per kg more than last year at around Rs 32 also because of low supplies.

In Srinagar, cauliflower prices are on an average Rs 13 per kg more than the same period last, the NHB data showed. One kg of round brinjal, costs on an average Rs 33 in Guwahati in July, while the same was priced at around Rs 24 in July last year, supplies in the city has almost halved between July 2009 to July 2010.

The only saving grace has been the price of onion and potatoes, which has not risen or have infact fallen in July. But, for how long.

"There is a probability of onion prices rising from September as output has been less-than-expected in Karnataka because of poor rains and the intense heat wave has damaged the quality of crop stored in warehouses," CB Holkar, president, National Horticulture Research and Development Foundation (NHRDF) said.