ONE of the most worrying facts about Indian agriculture is the volatility in the price and supply of several commodities including tomatoes and onions.

These two highly sensitive products, for instance, have over the years seen erratic and volatile movement in supply and price, frustrating farmers, traders, politicians and consumers.

The past few days have seen tomato prices shoot to record levels, breaching the Rs100/kg mark and almost touching Rs150 in cities like Mumbai.

The surprising fact is that just a few months ago, farmers across the country were bemoaning the massive drop in the price of the commodity

The surprising fact is that just a few months ago, farmers across the country were bemoaning the massive drop in the price of the commodity, which was retailing between Rs1 and Rs5 a kg.

Heavy rains of the past few weeks across the country have disrupted crops and supplies. Many farmers, in fact, had stopped growing tomatoes after the prices dipped to record low levels.

Just about two months ago, tomatoes were retailing for about Rs25 a kg in many cities. But as monsoon set in and intensified over the weeks, the prices quadrupled, breaching the Rs100-mark and upsetting millions of consumers.

In Mumbai, where rains are heavy during July, tomato prices shot up to a whopping Rs150 a kg last week, whereas in most other cities it was ruling at around Rs100.

When the price of items like tomato, onion and potato dip to record low levels, farmers are forced to dump their products. Many of them refuse to raise these crops for the next few seasons, resulting in a surge in prices.

Recent years, however, have seen a spurt in the production of tomatoes, much higher than the growth rate of potatoes and onions. According to the Indian Ministry of Agriculture, tomato production shot up from 10.3m tonnes in 2007-08 to 19.17m tonnes in 2014-15.

Potato production was more stable, rising from 34.66m tonnes in 2007-08 to 45.95m tonnes in 2014-15. And onion production grew from 13.9m tonnes to 18.73m tonnes during the same period.

According to the ministry, production of tomatoes, potatoes and onions, in 2015-16, has seen a record increase. Potato production has increased by 7.2pc to 46.5m tonnes, onion by 3pc to 21.6m and tomato by 5.1pc to 19.7m tonnes.

Madhya Pradesh, Karnataka and Andhra Pradesh are the largest growers of tomatoes, accounting for more than a third of the country’s total production.

Bellur Krishna, director, Horti­cultural Producers’ Cooperative Marketing and Processing Society, a state-run outfit, points out that many farmers shifted to other vegetables from tomatoes as the price realisation had been poor over the past few months.

“But now with demand picking up, farmers are back to growing tomatoes,” he says. Karnataka produces over two million tonnes of tomato every year.

Top government officials, however, believe that the spurt in the price of tomatoes is a temporary phenomenon, which will phase out soon. According to Shobana Pattanayak, the agriculture secretary, this is a lean season for tomatoes, but it will not last long.

BUT millions of consumers are dependent on products like tomatoes, potatoes and onions and resist any hike in price. Any spurt in the price of the products leads to riots and disturbances.

Just about 10 days ago, a gang of thieves stole 300 kg of tomatoes, laden in 30 crates, from a vegetable market in Dahisar in north-western Mumbai. The tomatoes were worth Rs70,000.

In Indore, the commercial capital of Madhya Pradesh — the state is the largest producer of tomatoes — armed security guards had to escort trucks carrying tomatoes, as traders feared attacks by consumers.

Despite India being the second-largest tomato producer — after China and ahead of the US — with a more than 10pc share of global produce, less than one per cent of its production is processed.

A report by the World Vegetable Centre, the international non-profit institute based in Taiwan — and set up in 1971 by the Asian Development Bank and the governments of the US, Japan, Taiwan and some other countries — says that the one per cent figure is way below the average of 26pc for the world’s top-10 tomato-producing countries.

However, tomato-based processed food consumption in India has been growing at 30pc annually for more than three years. The growing popularity of ready-to-eat meals, curries and snacks is boosting demand for the product in the country.

New tomato processing centres are being established by both existing players and new entrants into the industry. The former include multinationals such as Unilever and Nestle, while the latter include Kagome, the Japanese distributor of tomato-based food.

Others are also taking a keen interest in improving the tomato value chain in India. The German government’s ‘Green Innovation Centre,’ for instance, is involved in this task in Maharashtra, Karnataka and Andhra Pradesh.

Germany’s Federal Ministry for Economic Cooperation and Development started work in India in 2015, supporting farming enterprises and businesses along tomato and potato value chains in four districts in the three states.

The experts advise farmers on innovations including improvement of seed quality, technologies and machinery, provide training in good agricultural practices and support the setting up of farmer organisations. The centre also cooperates with the Indian ministry of agriculture.

According to German consultants here, the country has a lot to offer India in terms of agricultural technology. German firms have invested huge sums in India and recent years have seen agreements in areas including food safety standards, risk management and seeds development.

The German Agribusiness Alliance, an initiative of top German trade associations and companies from the agriculture sector, has also been involved in improving the farm segment in India.

Published in Dawn, The Business and Finance Weekly, July 31st, 2017