1. Demonetisation: Tomato prices plunge to all-time low of Rs 2-Rs 4 per kg; farmers in Maharashtra demand compensation

Demonetisation: Tomato prices plunge to all-time low of Rs 2-Rs 4 per kg; farmers in Maharashtra demand compensation

There is no demand in the market and traders are simply refusing to buy as a result of which there has been a huge drop in prices, Vegetable Growers Association of India (VGAI) president Shriram Gadhave said.

By: | Published: December 1, 2016 6:07 AM
Vegetable Growers Association of India, Demonetisation, Indian Farmers, Tomato Farms, wholesale markets There is no demand in the market and traders are simply refusing to buy as a result of which there has been a huge drop in prices, Vegetable Growers Association of India (VGAI) president Shriram Gadhave said. (Source: Express Photo)

With wholesale tomato prices falling to an all-time low of R2-R4 per kg in most markets across Maharashtra, tomato growers of the state have demanded compensation from the government. They say though they are in favour of the demonetisation move, they have been badly affected it. “There is no demand in the market and traders are simply refusing to buy as a result of which there has been a huge drop in prices,” Vegetable Growers Association of India (VGAI) president Shriram Gadhave said.

“In this currency shift, two sections of the society have been hit the most — workers and farmers — and both these sections should be compensated by the government since they are forced to put up with losses, Gadhave added.
Since the note ban has been announced by the government, there have been several instances of farmers being forced to throw away their produce outside markets since they are not getting the right prices, he said. Only a few instances are reported in the media, Gadhave pointed out.

While the motive of going cashless must be lauded, one must realise that most transactions in rural areas are done in cash and the shortage of currency in rural areas has affected the purchase of tomatoes in wholesale markets, he said.

With the cost of production being R10 a kg, farmers are losing up to R8 a kg, senior officials said. This time, the area under tomato cultivation has gone up and more than doubled because of good monsoon. The water table has gone up, and as a result, the production has also more than doubled.

In Pimpalgaon, one of the largest markets for tomato in the Nashik region, officials said arrivals have dropped down to some 20,000 crates (each crate of 20 kg each) since the border areas have shut business and no traders from these regions are coming for business.

The modal price at Pimpalgaon on Wednesday was around R4 per kg  with the minimum price at R31 for a crate and R185 the maximum price for a crate.

Pimpalgaon APMC chairman Dilip Bankar said the rural economy has totally collapsed because of demonetisation. The border areas are shut because of tensions, and there is a cash crunch in the market and the farmer has no money to pay his transporter or even the labourers. They are now leaving the tomatoes to rot on the field instead of plucking them, Bankar said.

“Even if the trader makes a cheque payment, the cheque takes days to realise and the farmer has to spend an entire day just to be able to withdraw R2,000 in cash. What is he expected to do with such a small amount — pay his transporter or labourers, fill up diesel for his tractor, or make purchases for his family?” he asked.

Usually a transporter charges R1,500 for a trip and labourers charge around R2,000 and this makes it difficult for farmers to make even the basic payments. One needs to understand that the farmers who grow vegetables, tomatoes and onions are usually from economically weaker sections and most transactions in rural areas are done in cash, Bankar pointed out.

The Pimpalgaon APMC had invited the district collector to visit the market and farmers to understand the problems faced by these sections. Moreover, most transactions in the rural areas is done through District Central Cooperative Banks  and cooperative credit societies and both are currently facing problems. The government should make all efforts necessary to make more cash available in the rural areas so that the economy does not suffer, Bankar said.

Gadhave’s organisation that runs a tomato auction at Narayanpur has also been hit this time. The organisation has been running the Narayangaon open tomato auction as an experiment to eliminate the middleman and help farmers get better prices for their produce. Over the years, the tomato auction has attracted the attention of other states as a model, but this time there are no traders and business is minimal, the VGAI chief said.

Nashik is the main supplier of tomatoes to most parts of the country. Pimpalgaon supplies tomatoes to markets like Delhi, Madhya Pradesh, Assam and Haryana. It also exports tomatoes to countries like Bangladesh and Pakistan.

Tomatoes are cultivated by farmers in Narayangaon near Pune, Nashik, Beed and Pusegaon, among other areas. In Narayangaon alone, around 18,000 acre usually comes under tomato cultivation resulting in a production of around 1,400 tonne a day. About 40,000 hectare come under tomato plantation in Pimpalgaon.

The season at Pimpalgaon will continue till November-December. Around 1.25 lakh hectare come under tomato cultivation in Nashik district every year. The last few months, however, have seen a drastic rise and fall in vegetables prices not only in Maharashtra but also across other states.

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