Vegetables become dear on erratic rain, low supply

Mumbai, Aug 26 | Updated: Aug 27 2008, 06:23am hrs
Vegetable prices, which jumped by up to one-fourth in the last fortnight, may remain higher for a month, due to lower supplies as an erratic monsoon damaged vegetable crop in some parts of the country, traders and analysts said. In last two months, many parts of main vegetable-producing regions received heavy rains, damaging crop and cutting arrivals, said Vilas Bhujbal, a vegetable trader in Pune.

Indias annual monsoon rains, crucial to the economy, covered the southern and western parts of the country ahead of the usual time of arrival, but soon weakened, delaying cultivation. It revived by July-end and early August, but heavy downpours led to a flood-like situation, damaging a part of the crop. Heavy downpours affected the crop in Uttar Pradesh, Punjab and Bihar in the north , Orissa and Assam in the- east, Andhra Pradesh in the south and Maharashtra in the west.

Vegetables are delicate crops with a 2-4 month lifespan and excess or deficient supply of water slashes yields. Supplies have gone down in all major markets and may increase from early October, when the new late-sown crop hits the market, said Ashok Gavade, a big trader at the Vashi market near Mumbai. Usually, vegetable prices rise in summer due to a lack of irrigation across much of the cultivable land and a rise in temperatures, which leads to a fall in output. But prices start falling from August, when the new crop hits the market. This year, the new crop was damaged by rains.

Indians mainly consume leafy vegetables like coriander, spinach (palak), fenugreek (methi) and cabbage. The staples include potato, sweet potato and onion and fruit vegetables like brinjal, tomato and okra (bhendi).

Prices of pulses, which consumers use as an alternative to vegetables, are very high and are supporting the firm vegetable prices, said Ravi Bhushan, an analyst at ICICI Direct. A likely drop in domestic output and higher prices at global markets have pushed up the prices of pulses .

In a largely vegetarian country, high vegetable prices hit consumers, who are already reeling under double- digit inflation.

Reuters