From past 1 month the raise in the cost of tomato is getting increased day by day, till 10 days ago, the tomatoes which were available at Rs 80 a kg are now getting sold at 100 to 120 rupees. If the experts are to be believed then the price of tomato will go up further. The tomatoes are being expensive due to their less supply in the market. It is worth thinking why the supply of tomatoes has become less in the market? So let this article help you in getting insight of this problem.
To understand the reason behind the less supply of tomatoes, we will first recounts the activities that have happened in past few months.
Let’s start with the farmer strike in Maharashtra, Maharashtra and Karnataka are the biggest source of tomato supply but due to farmers strike in Maharashtra and Karnataka, the supply of tomatoes is being affected. Along with the farmer’s strike delayed rains in Maharashtra and Karnataka has also played a major role in the hike price of tomatoes. “The farmer strike in Maharashtra and delayed rains have delayed the planting of the crop. The new crop will take some time to harvest,” Shankar Pingale, a trader in the Vashi market said. The tomato crop in Karnataka and Gujarat too have been delayed and it has impacted tomato supply in the market, said Pingale. Contradicting Pingle’s statement an economists said that, shortage of tomatoes are not because of the delay in rain but because of the farmer’s strike. She believed that this shortage of tomato is not because of the natural issue but is man-made problem, as the farmers’ dumped tomatoes on the street earlier this month demanding a farm loan waiver and also better procurement prices.
Another reason which contributes in the less supply of tomatoes is the newly introduced tax reform by the government. Yes, we are talking about the newly introduced Goods and Service Tax. GST has affected the sale and transport of vegetables. Many traders and wholesalers who do business running into crores have been habituated to showing a small percentage of their income on paper.The GST has been a jolt and it has impacted the supply chain. Wholesalers and truckers are cautious and are hoping that the old model of business can still work, said Sachchidanand Shukla, Chief Economist, Mahindra & Mahindra. “People have been doing business in wholesale and transport for generations where they could get away by showing very few things on paper,” said Shukla. But with GST, they have to show tax receipts to avail the input credit.Large procurers and wholesalers are hesitant to buy goods only in cash as the Income Tax department has warned people against indulging in cash transactions of Rs 2 lakh or more saying that the receiver of the amount will have to cough up an equal amount as penalty.
According to an analyst, kharif crop is being harvested and the produce has begun moving into sabzi mandis. He expects the prices to soon stabilise.
Last week, agriculture secretary Shobhana K Pattanayak also had assured of this. “This is a lean season for tomato. The price rise is a temporary phenomenon and it will fade out soon,” Pattanayak has been quoted as saying in a PTI report.