Vegetables baked by bad weather, fuel cost

KOCHI: Vegetable price values are running neck-and-neck with inflation. Over the past month, prices of essential vegetables have soared by over 25% in the Kerala market. Since a huge component of the vegetables traded in Kerala come from outside the state, transport costs have added to inflationary trends, traders said.
While prices of almost every vegetable traded in the market are volatile at least 2-3 times a year, the month of April was particularly cruel as headline inflation rose to 7.23%, leading to onions, fruits and essential Kerala menu-centric vegetables like beetroot, banana (nendran), cabbage, carrot, green chilli and drumsticks becoming dearer.And, maintaining their high price levels.
"Inflation of food prices in general is primarily being caused by higher transport costs and labour arbitrage. In the case of vegetables, lower than expected rainfall in Tamil Nadu - which supplies us vegetables like carrot, cabbage and beetroot - has caused price inflation. Water shortage is rife this summer and a number of power cuts in Tamil Nadu, on a daily basis, has led to prices of vegetables shooting up," said vegetable trader K B Jamal.
Cabbage was selling at Rs 40 per kg on Tuesday in Ernakulam from Rs 31 per kg in the first week of April. "Cabbage, which comes from Mettupalayam, has been affected by water shortage there," Jamal said. Carrot was selling 50% higher at Rs 36 per kg from Rs 24 per kg in April and potato - up 38% - at Rs 25 per kg from Rs 18 last month. Prices of small onions had shot up 100% to Rs 24 as of Tuesday. Nendran brought from Tamil Nadu showed a steep 44% price increase at Rs 46 per kg from Rs 32 in April.
In the Koothattukulam market, nendran auction prices touched a record Rs 50.50 per kg on Monday. Traders felt this could rise to as high as Rs 60 per kg once the nendran stock reaches the market. Complicating matters further is the widespread destruction of nendran plantations in Kerala by heavy winds and summer rainfall.
Traders noted that the current phase is likely to last 2-3 weeks till rainfall patterns turn positive. "Tamil Nadu is the primary vegetable supplier to Kerala and lack of water in Tamil Nadu has sent prices shooting up. We have noticed that the stock arriving from other states has fallen considerably. This is likely to continue till the rains pick up in the growing areas," said Fasal Rahman, a trader in the Ernakulam market.
After the government decided to link diesel prices to market rates, a price increase is rumoured this month. This, combined with the higher labour costs and scanty rainfall, worries the trading community more than the demand-supply paradigm.
"If diesel prices increase, there will be a permanent negative impact on vegetable prices. I believe that only a small basket of vegetables have been affected by price rise so far, especially vegetables imported from other states like Tamil Nadu and Punjab. Potatoes imported from Punjab are costlier and a diesel price increase will have a terrible impact on its future price," said president of Maradu Market Traders Association K G Antony.
Antony, however, insisted that the price increase is presently confined to only a small basket of goods. "But the dwindling labour in the agricultural sector in Tamil Nadu and other major vegetable-growing states is cause for concern, as they are migrating to employee guarantee schemes introduced by the central government which pay much higher," Antony said.
Traders underscore that the troika of growing labour shortage, power crunch and high fuel costs will be the long-term threats. "These are modifiable factors, unlike scanty rainfall or dry weather, but they defy any quick solution," traders said. These will be the real concerns going ahead.