Lessons in the rise of tomato prices

The first impact of a wayward monsoon has been felt on vegetable prices, which have shot up all over the country. The red signal was first given by tomatoes, but all other vegetables have followed them on the upward price graph. Tomatoes have surged to as much as Rs 135 per kg in some parts of the country, and all others, such as onions, potatoes, brinjals, ginger and green chilli have become costlier, too. The immediate reason is the disruption of transport caused by the monsoon, which affected the movement of vegetables. But the failure of timely rain in some areas has hit production. The result is the fall in the arrival of vegetables in the market, and the supply-demand imbalance has caused the prices to soar. But the price rise is not just due to the monsoon problem and the logistical issue. There are other factors that have worked independently or have aggravated the situation to send the prices soaring.

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India is the largest producer of vegetables and fruits in the world after China. There is a large diversity of crops, and they are grown in different agro-climatic conditions. This gives the country an advantage because if a crop fails in one area, it may succeed in another, ensuring a steady supply at all times. But this is possible only if there is good infrastructure and logistical support for storage and transportation of produce. These facilities are lacking in most regions of the country, though the need for them has been felt and voiced for decades. Cold-storage facilities are essential for perishable vegetables such as tomatoes and many fruits. They need to be stored, especially when there is excess production. This helps to avoid wastage and to ensure that the prices are stable. A good part of the vegetables and fruits are wasted every year. Pictures of farmers throwing tomatoes on the road have frequently been seen.

It is also necessary to ensure that the production of agricultural crops, especially fruits and vegetates, is made immune to the vagaries of weather, particularly the monsoon rains. Fruits and vegetables are especially sensitive to climate extremes. Tomatoes were impacted first by the heat waves, then unseasonal rains in Rajasthan, and later heavy rains in Karnataka. Karnataka and Andhra Pradesh are the top producers of tomatoes in the country. It is likely that the production of all crops will be adversely affected this year if El Nino impacts the monsoon. The Reserve Bank of India (RBI) has said that controlling food inflation will be a major challenge. Governments, both at the Centre and in the states, will have to be prepared to face a difficult situation.