Fruits and vegetables likely to cause losses exceeding Rs 15,000 crore during the pandemic lockout

The stockpiling of harvested and un-harvested perishables may have already caused farmers a loss of around Rs 15,000 crore, agri experts have estimated. Market arrivals of fruits and vegetables have sharply fallen since the imposition of the lockdown. Extended by another month, losses could swell to Rs 40,000-Rs 50,000 crore, if not more, traders and economists say.

“Farm-gate prices of perishables have fallen as the supply chain has been disrupted with trucks not plying. Also, all shops are closed, so there is no demand for products like milk, poultry and egg. The major problem is while farmers are unable to get values for their crops, at consumers’ end, prices have not declined,” noted economist Ashok Gulati observed.

The value of fruit and vegetables produced in the country – at prices realised by farmers – was Rs 5 lakh crore in 2019-20. Production of fruit in the last fiscal was estimated at 95.74 million tonnes and that of vegetables at 188 million tonnes. Currently, market arrivals are less than half the normal levels for key crops, leading to monthly losses of around Rs 20,000 crore, assuming most of the stocks with farmers perish.

Financial Express reported grape farmers from Nashik in Maharashtra are likely to incur losses worth Rs 1,500 crore. Around 6 lakh tonne of grapes still remain to be harvested. Currently grape harvesting is a tenth of the usual level of 1,500 tonnes per day. Except potato, carrot and beet root, all other vegetables are rotting in fields since small and marginal farmers lack access to cold-storage facilities. Also, many of these vegetables, including leafy ones, cannot be kept in cold stores. 

Similar sentiments prevail among all vegetable growers surrounding Delhi, which is India’s biggest trading hub for fruits and vegetables. Several places of Haryana such as Sonepat, Kondli, Hapur, Bahadurgarh, Rohtak and Bakhtawarpur used to send truckloads of vegetables to Delhi everyday. Some of the vegetables like baby corn, mainly grown around Sonepat, have no takers with restaurants and hotels closed.

Maharashtra’s Vashi mandi, which reports average daily trading turnover of Rs 5.5 crore, and the country’s second largest, has been shut, effective Saturday after a trader tested Covid-19 positive.

As per news reports, only a fraction of the nearly 7,000 wholesale markets in India are functioning. For non-perishable output like wheat and pulses farmers have some holding power, and government stockpiles and an existing public distribution system limit sustained market shortages. But for perishables like vegetables and fruits, this disruption means lower incomes for farmers (nowhere to sell, some are feeding spinach to cows), whereas consumers see scarcity.

Farmers at Guntur in Andhra Pradesh, where the largest chilly market yard in the country is located, are seeing no sign of relief, following a huge migrant labour issue caused by the lock-down. Guntur’s chilli market yard has been shut down, as the market yard is located in a containment zone. Mango growers from Devgad and Ratnagiri in Maharashtra are also reporting losses. Already hit by an extended monsoon last year, the growers now find no demand for mangoes. Ajit Gogate, president, Devgad Mango Growers Association known for the alphonso variety says that they have lost their peak marketing period due to coronavirus. Production has reduced to 15,000-20,000 tonne from a normal level of Rs 40,000 tonne and the farmers are trying to sell directly to customers to cover losses to an extent.

Shekhar Ghosh is a communications consultant and and former journalist, who has edited and written for publications such as like Business India, Business Standard, Business Today and Outlook.

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