Tomato prices: To aide farmers, govt may buy tomatoes as prices fall

Government is mulling buying tomatoes from farmers, amid falling prices in certain parts of the country, reported Mint. As per the report, the idea is to use the consumer affairs ministry’s price stabilization fund (PSF), typically used to cool vegetable prices, to lift stocks from areas flooded with tomatoes and sell them in markets nearby where prices are more remunerative.

This comes amid reports of farmers dumping tomatoes and using them as cattle feed. The prices have gone down to as low as ₹3-10 a kg last week from more than ₹250 a kg in August in certain states.

Mint quoted an official and said that the horticulture department is in discussions with the department of consumer affairs, food and public distribution to do a small intervention worth ₹10-20 crore to help tomato farmers.

“The horticulture department is in discussions with the department of consumer affairs, food and public distribution to do a small intervention worth ₹10-20 crore to help tomato farmers in some pockets get out of the glut-like situation, as prices are not falling across the country. The initial discussion indicates that the intervention could be under PSF like we did for onions," an official told Mint.

Also Read: Tomato price surge: cooling down with fresh arrival says govt

After a bumper yield of tomatoes, the biggest markets of Maharashtra, Karnataka and Andhra Pradesh have seen the lowest prices. As per Mint, the agriculture ministry expects tomato production to rise significantly in key producing states such as Himachal Pradesh, Karnataka, Tamil Nadu, Maharashtra, Andhra Pradesh, Telangana and Madhya Pradesh in the August-October period, which would put more pressure on prices. Production is expected to reach 956,000 tonnes in September and 1.3 million tonnes in October.

Also Read: Tomato prices: Government cuts price of subsidised tomato to Rs 70/kg

Tomato prices saw a surge in June and went as high as Rs 250 in August, prompting the government to take measures. The government also imported tomatoes from Nepal to cool down the prices. However an increase in the yield slashed the prices affecting the farmers.

As per Mint, Agitated farmers in Karnataka’s Kolar dumped their produce on streets after finding no buyers in auctions, while those in Andhra Pradesh’s Papili discarded them as cattle feed as the prices offered were insufficient to even pay for transport.

The National Horticulture Board showed that Average wholesale and retail prices of tomatoes stood at ₹30 and ₹15.8 per kg, respectively on Tuesday. According to data from the price monitoring division of the consumer affairs department, all-India average wholesale prices were down 63.3% from the previous month and nearly 18.4% lower from a year earlier, while the retail price was down nearly 61% month-on-month and 17.5% year-on-year.