In an attempt to provide relief to the common man’s pocket, the Central government on Sunday, 16 July capped the wholesale price of tomatoes to Rs 80 per kg in select cities including Delhi, Noida and Lucknow.
The price of tomatoes, which has been on the rise since last month, remained at an inflated cost of Rs 250 per kg across major cities on Saturday. According to government data, the all-India average of the kitchen staple hovered over Rs 117 per kg.
According to an official statement, after re-assessing the current situation of the market, the Centre decided to revise the price of tomatoes.
Tomatoes will be available at the reduced price of Rs 80 per kg Sunday onwards in Delhi, Noida, Lucknow, Kanpur, Varanasi, Patna, Muzaffarpur and Arrah, tweeted Rohit Kumar Singh, the Secretary of Department of Consumer Affairs.
The Department of Consumer Affairs had earlier reduced the wholesale cost of tomatoes to Rs 90 per kg on 15 July, before reducing it further by Rs 10 per kg the next day.
The National Agriculture Cooperation Marketing Federation of India (NAFED) and the National Consumer Cooperation Federation (NCCF) are tasked to provide tomatoes in these cities through mobile vans.
The price of tomatoes as well as other vegetables has been witnessing a steep rise even as heavy rains pound parts of northern India. How are the two linked, we explain:
Centre Caps Tomato Price @ Rs 80 in Delhi, Noida: Why Are Veggie Prices Soaring?
1. Disruption of Supply Caused By Rain Fury
The supply of fruit and vegetables has been disrupted in Himachal Pradesh, Uttarakhand and Punjab as the states endured unprecedented rainfall, which has wreaked havoc on the state infrastructure.
As a result, fruit prices have inflated 10 to 30 percent, while vegetable prices have shot up by 30 to 100 percent in the last one week, according to a report by Mint.
Even though tomatoes are grown across India, the southern and western regions account for majority (56-58 percent) of its production. These regions supply tomatoes to the rest of the country’s markets based on production seasons.
The harvesting season of tomatoes traditionally begins in December and goes on till February. Tomato output is typically low during July-August and October-November. The period of July-August also coincides with the Monsoon season.
This year, however, relentless rainfall has caused swelling of rivers and flooding in major cities – including Delhi, Chandigarh and Mohali – in northern India, and disrupted the supply of tomatoes and other vegetables from other parts of the country.
The increase in transportation costs has further exacerbated the situation and led to a sharp increase in prices.
Expand2. Crops Damaged Due To Changing Weather Patterns
Heavy rains have not only caused damage to life and property across parts of northern India but also damaged crops and impacted businesses.
Most standing vegetable crop in Delhi and adjoining areas were submerged in water, which is driving up prices, Business Standard quoted the Chairman of Vegetable Traders Association Anil Malhotra as saying.
Malhotra said that supplies from neighbouring towns such as Panipat and Sonipat in Haryana could not arrive because of torrential rainfall, forcing truck drivers to sell the vegetables in the local mandi.
Besides, unseasonal rains in April and May had damaged some of the vegetable crops earlier. The first three days of May, parts of north-western and central India had received 18 percent, 268 percent, and 88 percent higher-than-normal rainfall, respectively.
According to the Indian Meteorological Department (IMD), the whole of India received 28 percent higher-than-normal rainfall in the same period. In fact, the unseasonal rainfall caused Delhi to witness the second-coldest day in May in the last 13 years.
Devinder Sharma, agriculture and food policy expert, researcher and writer, told ABP Live that changing weather patterns – heat wave, unseasonal rains – are indicative of a climate emergency.
“Last year, there was a heat spell which affected the wheat crop. However, the heat spell was not followed by unseasonal rains… The weather patterns are changing, and the monsoon is likely to be impacted this year due to the El Niño effect. The rising sea temperatures are rising and unseasonal rains are all indicative of the climate emergency we are in."
Devinder Sharma, Agriculture and Food Policy ExpertExpand3. El Niño and Inflation
Low prices of vegetables in the last quarter have played a significant role in keeping inflation under control over the past few months. The Consumer Price Index (CPI)-based inflation reached a 25-month low of 4.25 percent in May.
However, the soaring prices of vegetables, especially the kitchen staple tomato, led to retail inflation surging past 4.81 percent in June, as per data released by the Ministry of Statistics on 13 July.
If the rain continues to display its fury, vegetable prices are expected to rise further, leading to higher inflationary pressures, according to experts.
ICRA's Chief Economist Aditi Nayar told The Economic Times that the spike in vegetable prices is said to put the CPI inflation to an uncomfortable 5.3-5.5 percent in July.
“Amidst the ongoing excess rainfall in North India, the surge in the prices of perishables, particularly vegetables, is likely to harden the food inflation further in the immediate term. Besides, the impact of El Nino on monsoons and sowing in India needs to be carefully monitored."
Aditi Nayar, Chief Economist, Investment Information and Credit Rating Agency (ICRA)Last month, the Reserve Bank of India (RBI) had too expressed concerns about inflation due to erratic weather patterns.
"Although there is an expectation of a normal monsoon, there are concerns around El Nino. We will have to see how serious it is. Other challenges are primarily weather-related events, which can have an impact on food inflation," RBI Governor Shaktikanta Das had said in an interview to PTI Bhasha.
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Expand
Disruption of Supply Caused By Rain Fury
The supply of fruit and vegetables has been disrupted in Himachal Pradesh, Uttarakhand and Punjab as the states endured unprecedented rainfall, which has wreaked havoc on the state infrastructure.
As a result, fruit prices have inflated 10 to 30 percent, while vegetable prices have shot up by 30 to 100 percent in the last one week, according to a report by Mint.
Even though tomatoes are grown across India, the southern and western regions account for majority (56-58 percent) of its production. These regions supply tomatoes to the rest of the country’s markets based on production seasons.
The harvesting season of tomatoes traditionally begins in December and goes on till February. Tomato output is typically low during July-August and October-November. The period of July-August also coincides with the Monsoon season.
This year, however, relentless rainfall has caused swelling of rivers and flooding in major cities – including Delhi, Chandigarh and Mohali – in northern India, and disrupted the supply of tomatoes and other vegetables from other parts of the country.
The increase in transportation costs has further exacerbated the situation and led to a sharp increase in prices.
Crops Damaged Due To Changing Weather Patterns
Heavy rains have not only caused damage to life and property across parts of northern India but also damaged crops and impacted businesses.
Most standing vegetable crop in Delhi and adjoining areas were submerged in water, which is driving up prices, Business Standard quoted the Chairman of Vegetable Traders Association Anil Malhotra as saying.
Malhotra said that supplies from neighbouring towns such as Panipat and Sonipat in Haryana could not arrive because of torrential rainfall, forcing truck drivers to sell the vegetables in the local mandi.
Besides, unseasonal rains in April and May had damaged some of the vegetable crops earlier. The first three days of May, parts of north-western and central India had received 18 percent, 268 percent, and 88 percent higher-than-normal rainfall, respectively.
According to the Indian Meteorological Department (IMD), the whole of India received 28 percent higher-than-normal rainfall in the same period. In fact, the unseasonal rainfall caused Delhi to witness the second-coldest day in May in the last 13 years.
Devinder Sharma, agriculture and food policy expert, researcher and writer, told ABP Live that changing weather patterns – heat wave, unseasonal rains – are indicative of a climate emergency.
“Last year, there was a heat spell which affected the wheat crop. However, the heat spell was not followed by unseasonal rains… The weather patterns are changing, and the monsoon is likely to be impacted this year due to the El Niño effect. The rising sea temperatures are rising and unseasonal rains are all indicative of the climate emergency we are in."Devinder Sharma, Agriculture and Food Policy Expert
El Niño and Inflation
Low prices of vegetables in the last quarter have played a significant role in keeping inflation under control over the past few months. The Consumer Price Index (CPI)-based inflation reached a 25-month low of 4.25 percent in May.
However, the soaring prices of vegetables, especially the kitchen staple tomato, led to retail inflation surging past 4.81 percent in June, as per data released by the Ministry of Statistics on 13 July.
If the rain continues to display its fury, vegetable prices are expected to rise further, leading to higher inflationary pressures, according to experts.
ICRA's Chief Economist Aditi Nayar told The Economic Times that the spike in vegetable prices is said to put the CPI inflation to an uncomfortable 5.3-5.5 percent in July.
“Amidst the ongoing excess rainfall in North India, the surge in the prices of perishables, particularly vegetables, is likely to harden the food inflation further in the immediate term. Besides, the impact of El Nino on monsoons and sowing in India needs to be carefully monitored."Aditi Nayar, Chief Economist, Investment Information and Credit Rating Agency (ICRA)
Last month, the Reserve Bank of India (RBI) had too expressed concerns about inflation due to erratic weather patterns.
"Although there is an expectation of a normal monsoon, there are concerns around El Nino. We will have to see how serious it is. Other challenges are primarily weather-related events, which can have an impact on food inflation," RBI Governor Shaktikanta Das had said in an interview to PTI Bhasha.
(At The Quint, we question everything. Play an active role in shaping our journalism by becoming a member today.)