Vegetable price gaps between retail and wholesale is close to 49%: ASSOCHAM

Difference between Wholesale Price (WSP) and Retail prices for essential vegetables have gone up beyond 49% in the year 2013-14 underscoring the widening gaps between the prices at which procurement is done from farmers and the price level for consumers, according to ASSOCHAM recent paper.

Majority of Indian retailers are selling vegetables at prices which are significantly higher than the WPI, reveals the ASSOCHAM latest study on Vegetables Wholesale and Retail Price Discrepancy. Normally, the difference between WSP and retail prices on an average stays around 30% and it has been much more as seen in the findings of paper.

Commenting on ASSOCHAM findings, its Secretary General, Mr. D S Rawat said, WSP benefited multiple times middlemen and traders, particularly for sale of essential commodities and worst hit in the process remained farmer and consumer as farmers margins squeezed badly with consumers paying unreasonably higher prices. Due to difference in both prices of wholesale and retail prices, the extra amount which end consumers are paying for vegetables is utterly disproportionate.

The study has considered nearly 33 market centres in India including Abohar, Agra, Ahmadabad, Amritsar, Bangalore, Baraut, Bhopal, Bhubaneshwar, Chandigarh, Chennai, Dehradun, Delhi, Gangatok, Guwahati, Hyderabad, Jaipur, Jammu, Kanpur, Kolkata, Lucknow, Mumbai, Nagpur, Nasik, Patna, Pimpalgaon, Pune, Raipur, Ranchi, Shimla, Surat and Trivendrum.

The study reveals that most of centres that have recorded huge discrimination between the wholesale prices and retails prices, out of 33 centres, nearly 18 centres are charging more than all India average retail prices and wholesale prices, adds the paper. The retail prices are over and above 85% to the wholesale prices.

It further points out, In category-III, the retail prices of vegetables charging more than 50% of the wholesale prices in top centers include Amritsar (120.5%) followed by Abohar (107.4%), Agra (90.2%), Nagpur (82.8%), Ahemdabad (69.4%), Delhi (68.9%), Chandigarh (68.5%), Dehradun (67.4%), Jaipur (64.6%) and Mumbai (63.5%).

In category-II, the retail prices of vegetables ranges from 30-50% of the wholesale prices in top ten centres include Surat (49.7%) followed by Lucknow (48.5%), Shimla (37.9%), Jammu (37.5%), Chennai (34.6%) and Guwahati (33.7%).

As per the ASSOCHAM findings, the price discrimination between retail and wholesale divided into three important categories. The first category is below 30% which represents normal case. The category-II and category-III indicate more than normal range of price discrimination and abnormal price discrimination respectively.

In the recent past, inflation has been a major concern for the policy makers. Both level of prices consumer price and wholesale price inflation has been very high especially in the case consumer price inflation; it has been around ten percent except Q4 2013-14, said Mr. Rawat.

The essential vegetables incorporated in the paper are bitter gourd, Brinjal long, Brinjal round, Cabbage, Cauliflower, Garlic, Ginger, Chilly, Okra, Onion, Peas, Potato fresh, Potato store, Tomato hybrid and Tomato local, highlights the paper.

ASSOCHAM urges government needs to play very crucial role to protect the producer interest. Improve infrastructure facility through encourage PPP initiate for the development of cold storage and facility should be provided those farmers which are coming from the long distance area. Grading of vegetable is another challenge that farmers are facing, therefore government should initiate grading training for farmers through workshop and also encourage NGOs participation.

On the retail front, the analysis has observed that retailers are charging very high prices as compared to wholesale prices of the vegetables. In such scenario, government needs to play proactive role to control the retail price through surveillance scheme, adds the paper.

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