High tomato prices in India trigger thefts, fears of inflation spike

The government has even organised a hackathon seeking ideas on how to keep prices stable.

Nirmala Ganapathy

Nirmala Ganapathy

The Straits Times


Vegetable vendors are increasing vigilance amid growing reports of tomato theft and robbery. PHOTO: REUTERS

July 18, 2023

NEW DELHI – India is facing a tomato crisis. The price of tomatoes has increased six times, climbing since the beginning of June, due to a combination of hot weather, late rains and a virus causing a supply shortage.

This has triggered tomato thefts and forced some people to go without the staple in curries.

The government has even organised a hackathon seeking ideas on how to keep prices stable.

Tomato prices usually hover around 30 to 40 rupees (49 to 65 Singapore cents) per kg but are now an eye-watering 200 rupees per kg in some parts of the country.

Amid deeper concerns over whether this could contribute to food inflation, a trending topic on social media is recipes for dishes that do not require the use of tomatoes, like sambar or dahi aloo (curd potato).

Lower-income groups are most affected and some people have been forced to cut back.

“I put one tomato instead of three in fish curry. But in other dishes, I am not using tomatoes,” said Ms Dilruba, a cook in Delhi. “I hope prices will come down soon.”

Vegetable vendors are increasing vigilance amid growing reports of tomato theft and robbery.

In one major haul, a truck transporting tomatoes was waylaid by three men who beat up the farmer and drove off with 2,000kg of tomatoes.

Tomato prices usually go up during the June to August period because of the gap between harvests. But an intense heatwave in the last week of June combined with intermittent rainfall, the late onset of monsoon rains in July and the appearance of a tomato virus in some growing areas have curbed supplies and pushed up prices.

The virus has cut harvests in the state of Karnataka, among half a dozen states, including Maharashtra and Himachal Pradesh, which are key tomato growers.

A scientist with a government agency, who did not want to be named because he was not authorised to speak to the media, said that reports from farms suggested the production, usually 25 to 30 tonnes per acre (0.4ha) of land, would likely be halved in Karnataka.

This sudden demand-supply mismatch comes after tomato prices crashed to 1.5 rupees per kg in May amid a production glut, with a group of farmers in Maharashtra state dumping tomatoes on the road in protest, saying they preferred destroying the crop to selling it at a low rate.

“Tomato-producing areas were exposed to high temperatures or even unseasonal rains. So there is a shortage,” said Dr A. Amarender Reddy, principal scientist (agricultural economics) at the Central Research Institute for Dryland Agriculture in Hyderabad. He noted that most consumers would continue to buy tomatoes, leading to shortages amid less supply.

Agriculture writer Devender Sharma said profiteering is happening.

“The traders are also jacking up prices. There is a knock-on effect on some other vegetables,” he noted. The prices of some vegetables such as cauliflower and chillies have increased 10 to 20 per cent.

As prices soared, fast-food chain McDonald’s dropped tomatoes from its burgers and wraps at some of its outlets, saying it was unable to source tomatoes that passed its quality checks.

India is one of the world’s largest producers of tomatoes, mostly for domestic consumption. In 2022, production was an estimated 20 million tonnes.

In 2018, Prime Minister Narendra Modi said that TOP – tomatoes, onions and potatoes – were a priority for his government.

High onion prices, in particular, have been known to exact a high political price.

In 1998, a government run by the Bharatiya Janata Party in Delhi was voted out because state elections coincided with a rise in onion prices. In the 1980 national elections, former prime minister Indira Gandhi used the price of onions, among other issues, to attack the government. She won the elections.

At present, onion and potato prices have remained stable.

While the Modi government is in no danger of falling from power, the rise in food prices could have an impact on the general elections due in the first half of 2024.

Prices have also gone up for pulses such as tur dal, which has increased by 25 per cent.

Aware of the danger of rising food prices, the government on July 1 announced a Tomato Grand Challenge hackathon, seeking “innovative ideas” from students, professionals and start-ups on how to stabilise the price and help farmers get value for their produce.

The government has asked for ideas on planting varieties with longer shelf-life, improving the transportation of fresh and processed products, and innovative packaging and storage.

A key danger from higher tomato prices is their impact on inflation.

The government on Wednesday said it expected to see prices “cool down in the near future” but did not provide a timeframe for this. It also announced it would source tomatoes from Andhra Pradesh, Karnataka and Maharashtra for cities that have seen the biggest price increases.

“Trends suggest that while June inflation (figures) out this week would stay below 5 per cent owing to base effects, July to August headline inflation is on course to spring back into the 5 to 5.8 per cent range, reflecting the rise in the food basket,” said Ms Radhika Rao, senior economist and executive director at DBS Bank, Singapore.

She noted that raising imports and releasing government buffer stocks of foodgrains “might be the first line of defence against supply-driven shortages”.

Some state governments have taken steps against hoarding, including warning traders. Tamil Nadu has started selling tomatoes for 60 rupees per kg in ration shops, which provide food to poorer people at subsidised rates.


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