Price crashes as supply glut and several other factors manipulate market in Himachal Pradesh
An unprecedented price crash in wholesale markets or mandis has upset Himachal Pradesh’s apple cart this season, distressing nearly 1.20 lakh growers in the state, of whom about 80 per cent are small and marginal farmers. Boxes weighing 22 kg to 35 kg of the juiciest and crunchiest Delicious variety are being sold at a measly Rs 400 to Rs 1,200 each. More than 50 per cent of the produce is yet to reach the markets and there’s no sign of recovery.
It is estimated that the state will likely produce more than 40 million boxes, despite a dry spell and extreme weather such as heavy rain and hailstorms in the apple-growing areas of Shimla, Mandi and Kullu scarring the apples and upsetting their size, colour and shine. This is said to be one of the reasons that caused apple prices to fall. But orchard owners growing imported varieties have managed to tide over the crisis with a better yield that fetched them good rates through direct sales to corporate chains outside the state. “Himachal apples are going to vanish. We need to shift to high-density varieties to suit the climatic change, low productivity and competition from foreign apples. Our marketing must be innovative too. Trucking the produce to markets should be timed with demand to avoid a glut, and eventual price crash, here,” says Ram Lal Chauhan, an apple grower who has won national and international awards.
A sudden overabundance of seasonal farm produce is the biggest bane in a country that has limited warehouses suited for storing agricultural products. Take for instance, the case of a tomato glut in the plains, especially Dewas in Madhya Pradesh—the nation’s top tomato-growing state—where the price at mandis fell to Rs 8 a kg by the end of this August. In fact, tomato prices in wholesale markets in most producing states have crashed to as low as Rs 4 a kg amid a supply glut, government data showed. Favourable weather this summer or early kharif season has yielded a better harvest than last year and farmers can be saved from falling prices if food processing companies come to their rescue, P.K. Gupta, acting director of the National Horticultural Research and Development Foundation, was quoted as saying.
In Himachal Pradesh, it has been alleged that big companies are playing a part in the crisis by lowering down their rate substantially—from last year’s Rs 88 a kg for best quality apples to Rs 16 this season. Apparently, these apples bought at a “pittance” are sold at a premium in the cities. Besides, another factor spurring the distress is said to be the dime and dozen local markets where new-age middlemen or commission agents—called arthiyas—are dictating the price. There is a nexus controlling the markets in a three-tier chain—local arthiyas trying to make a fast buck, agents at markets outside the state, bulk buyers or “ladanis” as well as companies.
Apples were introduced in Himachal Pradesh by an American, Samuel Evans Stokes, in the 1920s and the fruit has grown to become one of the mainstays of the state’s economy, fetching Rs 5,000 crore a year. Himachal apples—the Delicious being the best—had competed with varieties from Kashmir and abroad. But the competition is growing within the state over the past several years as many orchards have switched to newer varieties such as Red Chief, Super Chief, Oregon Spur and Scarlet Spur that fetch better rates than the “traditional” Delicious. What’s hurting more is the craze for good-looking, shiny apples. Most apple farms use organic methods and get misshapen fruits. “We don’t use harmful pesticides or sprays to add colour and shine. So, our produce is treated as inferior over those riddled with poison,” says Rajkumar Chauhan, an organic apple farmer.
(This appeared in the print edition as "Bad Apples Spoil The Delicious")
By Ashwani Sharma in Shimla