The Sudden Spike in Tomato Prices

After China, India is the world's second-largest tomato grower, generating 19.75 million tonnes from 7.89 lakh hectares with an average yield of 25.05 tonnes per hectare. Andhra Pradesh is the country's major tomato grower domestically. In most southern states, tomatoes are currently sold for more than Rs 100 per kilogram. Chennai is the worst-affected city, with the much-needed vegetable now costing Rs 140 per kg. Tomatoes are consumed by everyone, regardless of their socioeconomic status. Every day, nearly 40,000 tonnes of tomatoes are consumed in India. As a result, when prices rise, it burns a hole in the wallets of purchasers.

The Causes of the Price Hike:

Tomatoes, which are generally sold for roughly Rs 20 per kg in the winter, are now more expensive due to severe rains in Karnataka, Andhra Pradesh, and Maharashtra during the first week of November, which resulted in extensive crop damage and a supply shortfall. During the months of October and December, they are the most important suppliers, unable to match demand. Tomato prices have risen as a result of rising petroleum prices, increased demand during the wedding season, and hoarding, in addition to agricultural damage caused by rain.

The issue with tomatoes is that they are perishable, with a shelf life of only around 10 days. The storage and transportation infrastructure facilities are below average, resulting in a one- or two-day reduction in shelf life. There is a significant wastage problem across the tomato supply chain, with roughly 10% loss during harvest and 15-20% loss post-harvest, for a total of 30% loss until it reaches the client. Prices would never rise this high if we could prevent the loss at these phases.

Thank you.

Regards,

Janvi Shah (Section F),

Kautilya,

IBS Mumbai.