Context:
Retail prices of tomatoes in major cities of India have increased significantly.
Reasons for Increasing Prices:
- Cobweb Pattern: Tomato prices follow a typical price-production cobweb pattern. In May 2022 and June 2022, tomato inflation spiked to 135.6% and 158.6% respectively.
- Cobweb pattern is a phenomenon where the prices of certain goods witness fluctuations that are cyclical in nature.
- Reduced Cultivation: The decline in prices from November 2022 resulted in significant losses for small farmers, leading to reduced cultivation and switching to other crops like beans, soya, and corn.
- Other Factors: Factors like attacks of leaf curl virus in major tomato-producing districts and low yield compared to global standards also contribute to the price fluctuations.
Way Forward:
- Promote Processed Tomatoes: Encourage the processing of fresh tomatoes into tomato paste/puree. This allows consumers to shift to processed tomatoes during price surges and stabilizes farmer prices.
- Reducing the GST rates on processed tomatoes from 12% to 5% can enhance affordability.
- Market Reforms: Implement reforms that promote direct marketing, contract farming, and private mandis. This reduces intermediaries in the supply chain, leading to lower prices for consumers.
- Market reforms also improve competition, infrastructure, and reduce post-harvest losses.
- Leveraging e-NAM: Utilize the national agricultural markets (e-NAM) platform to streamline trading procedures, bring transparency to Agricultural Produce Market Committee (APMC) mandis, and enable online trading for farmers and traders.
- Spatial integration for TOP commodities (tomatoes, onions, and potatoes) can help reduce inefficiencies and benefit both farmers and consumers.
- Promote Polyhouse Cultivation: Encourage the usage of polyhouse cultivation for tomatoes.
- This modern cultivation technique can significantly enhance yields, stabilize prices, and ensure a continuous tomato supply.
- A polyhouse is a specially constructed structure like a building where a specialized polythene sheet is used as a covering material under which crops can be grown in partially or fully controlled climatic conditions.
- It is covered with a transparent material to permit the entry of natural light.
- Subsidies: Subsidies for Farmer Producer Organizations (FP0s) and farmers can help them afford the capital-intensive technology.
| Additional Information:
Tomato (Lycopersicon esculentum):
- It is the second most important vegetable crop next to potato. Present world production is about 100 million tons of fresh fruit from 3.7 million hectares.(FAOSTAT, 2001).
- It is a rabi crop and can be grown on a wide range of soils but a well-drained, light loam soil with pH of 5 to 7 is preferred.
- India is the 2nd largest producer of tomatoes after China.
- Madhya Pradesh, Andhra Pradesh and Karnataka are leading producers of tomatoes in India.
e-Nam:
- An important initiative of the Indian Government to use pan-India electronic trading portal for bidding and network the existing APMC mandis to create a unified national market for agricultural commodities.
Agricultural Produce Market Committee (APMC):
- A statutory market committee is a committee constituted by a State Government.
- It operates under the Agricultural Produce Market Committee Act which is issued by the state government.
- The primary objective of these committees is to regulate the marketing of notified agricultural produce and livestock in physical, electronic or other such mode.
Operation Greens:
- Announced to promote Farmer Producer Organizations (FPOs), agri-logistics, processing facilities for integrated development of Tomato-Onion-Potato (TOP) value chain.
- The idea behind this Operation is to double the income of farmers by the end of 2022.
Tomato Grand Challenge (TGC) Hackathon (2022):
- Led by the Department of Consumer Affairs and in collaboration with the Ministry of Education (Innovation Cell), with an aim to revolutionize the tomato value chain in India.
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News Source: Times of India
3 Jul 2023
