‘Nothing has changed since the protests’: Why farmers are still getting low prices for their crops

After a slump last month, tomato prices have soared across India. In mid-June, tomato was selling at agricultural produce markets for an average of Rs 600 per quintal, or Rs 6 per kg. A month later, the average price per quintal is Rs 4,100, a seven-fold increase.

The price rise may have been partly caused by the farmers’ strike that swept western Maharashtra in early June, but the farmers who protested are unlikely to benefit from it.

“During the strike, farmers did not even enter their fields to harvest tomatoes,” said Shriram Gadhave, of the All India Vegetable Growers’ Association, who is based in Maharashtra’s Nashik. “Because tomatoes were not plucked and rotted, the plants were damaged. Now there will be no more tomatoes from these areas for another two months.”

There are other reasons for the spike in prices. In Solan, Himachal Pradesh, where farmers had been protesting for better prices for their tomato crop, rain in other parts of the country last month led to the vegetable selling at the price of apple, the daily Panchayat Times reported.

“Demand has risen here because rain in places like Karnataka, Rajasthan, Gujarat, Uttar Pradesh and Madhya Pradesh has meant their production has stopped,” said Bhanu Sharma, secretary of Solan’s Agricultural Produce Market Committee. “Our arrivals continue to be very good.”

Farmers in at least 16 states demonstrated for better prices for their crops in June after the Uttar Pradesh government announced farm loan waivers and farmers in Maharashtra and Madhya Pradesh went on strike and boycotted markets.

Yet, except for tomato, prices continue to be low for most other crops. “This is the first time I have seen farmers in Jalandhar in such a bad situation,” said Jaspreet Singh of the Jalandhar Potato Growers Association. Farmers in Punjab had dumped truckfuls of potato on the highways last month to protest low prices. Farmers in Uttar Pradesh, India’s largest potato producer, too had protested for the same reason.

“I am a small potato farmer and I have lost Rs six lakh to Rs seven lakh this season since October,” Singh said. This is because market prices have been too low to even recoup production costs.

Singh pointed to systemic reasons for the prolonged depression in potato prices. One was demonetisation, which led several farmers to keep their produce in storage for longer until liquidity returned to the market. Another was a doubling in production at the end of the summer. The third reason is that potato exports have been limited since the Union government curtailed trade with Pakistan.

As this chart shows, potato prices have hovered between Rs 300 and Rs 500 per quintal since April. In the same period last year, prices were between Rs 800 and Rs 1400 per quintal.

Similar is the case of other crops. Prices have remained largely static for red chilly in Telangana and Andhra Pradesh, where in May this year, the farmers threw away their produce in anger at low prices after a bumper harvest. Garlic prices continue to fall.

Garlic farmers in Kota, Rajasthan, have been protesting for better prices for months now. There has been little variation in the prices, as the chart above shows. The price per quintal for garlic was Rs 8,000 two years ago as against the average of Rs 3,200 today, according to Amraram, president of the Communist Party of India’s All India Kisan Sabha, who is based in Jaipur.

It is understandable that markets might not respond to protests, Amraram said, but even procurement by the government, which can arguably reduce farmer distress, has not been effective. “Nothing has changed since the protest except that we are still protesting,” Amraram complained. “The prices of onion, mustard and garlic are all still very low. And even though it has been so many days, the government is still not procuring enough produce at minimum support prices.”

The only state where the protests have compelled the government to step up procurement is Madhya Pradesh. The state swung into action to procure onion until the end of June from farmers agitated about low prices. But the absence of enough storage space has meant officials cannot decide what to do with the approximately eight lakh tonnes of onion, some of which is already rotting.

Officials in some districts have sough permission to bury the procured onion while others want to use the stock to fuel power plants. Yet others are crushing them with road rollers. If that was not depressing enough, traders in other states have complained that onion from Madhya Pradesh has flooded their markets, further lowering the prices.