New Delhi: Prices of key kitchen vegetables potato and tomato, which witnessed a record high in the past few weeks, aren’t expected to nose-dive anytime soon as rates are likely to hover above Rs 50/kg for a few months now.

Potato prices in the past few weeks have been hovering around Rs 50/kg, while tomato rates were as high as over Rs 70/kg due to lockdowns, unfavourable weather, among other reasons.

The arrival of potatoes in Delhi’s Azadpur Mandi has decreased by one-fifth in the last 10 days — from 548 tonnes on 10 July to 101 tonnes on 20 July. The wholesale prices of the potatoes in the mandi has also increased — from Rs 18/kg to Rs 30/kg during the same period.

The arrival of tomatoes has also gone down in the same period — from 353 tonnes to 163 tonnes, and the wholesale prices have gone up from Rs 18/kg to Rs 40/kg. 

The retail price of the vegetables are, on an average, double the wholesale prices.

Traders in wholesale mandis across India have cited various reasons for such a sharp increase in the prices of these vegetables. One of the major reasons, according to them, is the supply deficit, which has dropped abysmally against the demand that has gone up after the lockdown.

This supply gap, according to the traders, was due to heavy pre-monsoon rain and lockdown imposed in certain cities such as Bengaluru, Pune and in some parts of Uttar Pradesh.

Another major reason for the decrease in supply was because many farmers left cultivation of these vegetables after a crash in their prices during the lockdown.

Only 10-15 trucks coming to Azadpur Mandi

Budhi Raja Singh, a wholesale trader of vegetables at Azadpur Mandi in Delhi, told ThePrint: “Normally at least 100-125 trucks of tomato and potato would daily arrive in the mandi — each with 40-50 tonnes of these vegetables. This has decreased to just 10-15 trucks and with an increase in demand this month, these are selling out in a few minutes.

“In the lockdown, prices of potato, tomato and onion crashed to Rs 1-5/kg. Tomatoes and potatoes are supplied from nearby states of Haryana, Himachal and UP. Farmers of these states, given falling prices, had ploughed their crops as they were not even able to get their sowing, labour and transportation costs so they went for crops like paddy, maize and cotton, which are procured by the government and prices are assured there.”

He said prices will only come down after a couple of months when fresh crops will arrive, which was sown around June as these crops take 100-140 days to get ready.

Until then, Singh added, prices of potatoes and tomatoes will remain above Rs 50/kg.

The average production cost in tomato, onion and potato is around Rs 9-10/kg to farmers. On adding the other miscellaneous prices such as storage, labour, transport and other market charges, it comes to Rs 15-17/kg. However, with a price crash during the Covid-19 lockdown, the farmers incurred heavy losses.

Pradeep Kumar, a wholesale vegetable seller at Kanakapura market in Karnataka, which is  a major tomato producing state, told ThePrint: “Vegetables like tomato and potato have witnessed a major spike in prices as the mandi rates of tomatoes have gone up from Rs 15/kg to Rs 38/kg in a week. Also, the cost of potatoes has increased from Rs 10/kg to Rs 35/kg over the last few days.”

Kumar added the price rise is because the supply of potatoes from cold storage across the country has been hampered due to lockdowns in some states.

“… the prices of potato might come down by late August or September. The tomato crop has been spoiled by heavy rains and the new crop will only come in October, which will decrease the prices,” he added.

Onion prices likely to soar later this year

Prices of another important kitchen staple, onion, are, however, much stable now as compared to last year when it was sold for over Rs 150/kg. Retail price of onions is now Rs 20/kg.

The rabi season of 2019-20 had yielded bumper crop in Maharashtra and Madhya Pradesh, which led to low onion prices due to oversupply in the markets.

However, onion traders in Nashik, the highest onion-producing region, have warned of a price rise again later this year due to heavy rains and feeble procurement by the government. 

“The onion crop has been sold even below one rupee/kg this year during the lockdown period as the government failed to procure it and make up a buffer stock for the lean season from September to January. Also, the domestic storage made by the farmers has been spoiled by heavy rains,” Deepak Kale, a wholesale onion trader in Lasalgaon mandi in Nashik, told ThePrint.

ThePrint had reported earlier this month that the government had nearly doubled its buffer stock target to 1 lakh metric tonnes after last year’s price rise, but so far, it has only procured 45,000 metric tonnes (MT).

Nana Saheb Patil, director of NAFED (National Agricultural Cooperative Marketing Federation of India) in Maharashtra, told ThePrint that the Covid-19 lockdown has had an impact on the procurement process this year.

“The onion crop, which is stored in buffer stock, is harvested in March-April, and during that time, labour shortage and closure of markets due to the lockdown hit the pace of procurement,” he said.

Patil also said the possibility of the government’s target of procuring one lakh MT of onions looks “bleak”.

“After the monsoon strikes, the quality of onion will degrade, which will make it unsuitable for procurement and storage. The possibility of meeting the 1 lakh MT target is bleak this year,” he added.

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