Agri commodity prices vary amid lower arrivals in lockdown

New Delhi, April 22 Amid an extended lockdown, the farm commodity prices are showing unusual trends at mandis.

According to a Crisil Research report, though there has been a sharp decline in arrivals of agri commodities in the first two weeks of April, mandi prices of vegetables, pulses and rabi crops have increased sharply, while rates of fruits, paddy and fibre crops have shown a significant decline.

Mandi arrivals across commodities declined 68-99 per cent during April 1-12 due to delayed rabi harvest, labour shortage, lack of transport and reduced mandi operations. Moreover, grain is also said to be being hoarded by farmers/traders to be sold later on normalisation of mandi operations and logistics, pushing the prices up.

In the case of perishables, like fruits and vegetable, farmers are suffering due to crash in demand because of the lockdown. Export of grapes and mangoes are also halted. Domestic fruit prices were 10 per cent lower despite 85 per cent fall in arrivals, the report said.

Similarly, the mandi prices of fibre crops and paddy & coarse grain declined 31 and 2 per cent, respectively, in the first 12 days of April, even though arrivals dipped 99 per cent and 68 per cent, respectively.

In case of fruits, mandi prices have declined due to lower exports of seasonal crops, such as mango and grapes, and limited domestic offtake amid the lockdown.

The report indicates increase in consumption of pulses during the lockdown. Increase in demand has raised mandi prices 28 per cent this month. Higher demand has also increased hoarding that has too kept the prices up.

The case is similar for vegetables. Mandi prices have shot up 83 per cent in April 1-12. "Mandi prices (of vegetables) have increased sharply on-year as arrivals have plunged due to restricted market access to farmers. But middlemen estimated to be procuring at much lower prices from farmers given their limited bargaining power due to perishable nature of commodities," Crisil said.

In case of rabi crops, primarily wheat, delayed harvesting due to labour shortage has pushed up prices by up to 29 per cent at mandis. But projections of a bumper output, lower industrial demand and limited exports were likely to exert pressure on wheat prices, it said.

The case is different for paddy and coarse grain where arrivals have fallen due to curbs on inter-state movement of goods and non-availability of logistics partners. Also, decline in industrial and animal/poultry feed demand for coarse grain is estimated to have led to a decline in mandi prices.

"Mandi prices have logged a sharp decline despite significantly lower market arrivals due to lower domestic and export demand for cotton crop," said the report for fibre crops.

( With inputs from IANS )