Vegetables production almost stagnant in 2015-16

The WPI-based inflation in vegetables rose to 28.05% in July from 16.91% in June; retail vegetables inflation remained over 14% in both July and June

Even as horticulture output has surpassed foodgrain production for the fourth year in a row in 2015-16 (July-June), overall vegetable production remains a concern. 

Vegetable production is almost stagnant at around 167 million tonnes in 2015-16 year-on-year, with some variations in composition. 

Perhaps due to this and also because of logistics due to rains, vegetable inflation has been rising of late. The wholesale-price index based inflation in vegetables rose to 28.05% in July from 16.91% in the  previous month. Similarly, vegetables’ inflation in the Consumer Price Index remained elevated at over 14% in both July and June. It has been in double digits since May. 

It should be noted that there are seasonal variations in vegetable production and the correlation between its yearly output and monthly inflation is only a broad gauge. 

Within vegetables, production of potatoes declined 9% to 43.7 million tonnes (MT) from 48 MT last year, largely because of a decline in West Bengal, an official said.

The wholesale price index-based inflation in potatoes remained elevated in the 40-64% range between April and July. 

However, onion output rose 11%, touching 21 MT, a new record.

The higher output led to continuous fall in prices of onions for quite some time. WPI Inflation in onions was (-) 36.29 per cent in July, (-) 28.60 per cent in June and (-)21.70 per cent in May. 

In fact, the government has announced export incentives to push up onion prices to help farmers.

Total horticulture output is estimated to be 283.4 mt in 2015-16, just about 0.8% higher than the nearly 281 MT a year before. But it was higher by 31.18 million tonnes than foodgrains  production.