Crisil Research on Friday attributed the current spike in vegetable prices to excessive rains. Further as per the Research firm, the cost of tomatoes shall continue to be on the higher side for two more months.
Highlighting the on-ground interactions, the firm said the condition in Karnataka- one of the top tomato producing regions is so 'grim' that the commodity is being sourced from Maharashtra's Nashik. On a YoY basis, prices of tomato have gained sharply by 142 percent in November and are expected to climb further higher for another 45-50 days until the harvest from Rajasthan and MP begins to reach the markets in January.
Additionally, the research entity mentioned that the standing crops got damaged owing to excessive rainfall in Karnataka, Maharashtra and AP -that are the key suppliers during the October-December period.
As per CRISIL, tomatoes which are currently retailing at a price of Rs. 47 per kg will soften in price by 30 percent as and when the new crop begins to reach the market.
On Friday, tomato prices in the National Capital increased to Rs. 75 per kg, while in some of the other Southern cities it softened but still continued to be high, as per the government data.
For onion, the report mentioned that transplanting got delayed in the key region of Maharashtra owing to rainfall deficit in August, resulting in delayed arrivals in October and hence eventually the prices of onion jumped by 65 percent in comparison to September rates. Nevertheless, as fresh arrivals from Haryana are expected in next 10-15 days, prices of onion shall soften.
For potato, another rabi crop, sowing season has been hit hard because of excessive rains in Uttar Pradesh, West Bengal, Bihar and Gujarat, added the report.
The researchers' on-ground interactions suggest excessive water logging in the fields may warrant resowing of potato tubers, adding to the cost of farmers. If the heavy rains continue, prices will be higher for two more months, it said.
"Net-net, any respite in vegetable prices in the short-term will be a function of how it pours from here. Hopefully, as the north-east monsoon beats a retreat, the worst may be over for vegetable prices,"