Tomato prices, which surged by 142% on year in November, would continue to grow over the next 45-50 days, according to CRISIL Research.
During the months of October to December, states such as Karnataka, Andhra Pradesh, and Maharashtra are major tomato suppliers. However, excessive rains in these regions (Karnataka-105 %, Andhra Pradesh-40 %, and Maharashtra-22 % higher between October 1st to November 24th have destroyed standing crops, limiting supplies.
"As per ground contact, the situation in Karnataka is so bad that places like Nasik are exporting tomatoes to the state. As a result, prices climbed by 142% year on year in November. Prices are projected to climb further over the next 45-50 days till arrivals from Madhya Pradesh and Rajasthan commence in January ", said Hetal Gandhi, director of CRISIL Research.
She added, "The year 2021 had an irregular South-West monsoon, which triggered an increase in perishables prices. And, once again, the North-East monsoon is wreaking havoc on these crops. From October 1st to November 24th, cumulative rains were 47% more than normal. These excessive rains have adversely harmed crops such as tomato, okra, and capsicum, to mention a few, leading to a spike in crop prices."
Excessive rainfall during planting, which resulted in poor germination for overall vegetables, followed by heavy rains during harvest in few key regions, has resulted in a sudden significant price increase.
"Tomatoes from the Bengaluru region and Raichur are no longer coming to Delhi because to the unseasonal rains in these places," said Sanjay Bhagat, general secretary, Gobi Shimla Traders Association from Azadpur wholesale market in Delhi. Tomato prices have been rising over the last 20-25 days, reaching a high of Rs.75 per kg in wholesale."
Tomatoes cost Rs.60-65 per kg at wholesale in Azadpur. Along with limited supply, rising demand for tomatoes as a result of a busy wedding season is keeping prices high. "The demand for vegetables is high owing to the wedding season, and tomatoes are used in almost every meal," said Rajkumar Bhatia, general secretary of the Azadpur Chamber of Fruit and Vegetable Associations.
Gandhi stated that the early kharif crop of okra was also damaged due to excessive rainfall during seeding and the early vegetative stage in states such as Andhra Pradesh, one of the top producers of okra, which received 23% more precipitation in August.
"In addition, severe rains in Gujarat during the fruit setting stage exacerbated supply issues. Prices for okra, which are up 57 % year on year, are projected to fall in the next 20-25 days as supply increases "rivals," she explained.
According to CRISIL, rainfall will be a key monitorable for providing respite to the fiery prices.
