Cash crunch: Wholesale veggie prices fall in cities; retail rates largely unaffected

Representational pic/ Nimesh Dave

Demonetisation has impacted each and every aspect of everyday life, and vegetable prices have been no different. But, while in rural areas both wholesale and retail prices have crashed, the same hasn't been the case in cities. While wholesale prices have dropped, retail prices, on the other hand, have not seen much of an impact as far as lowering of prices is concerned.

According to a report in the Times of India, an analysis of arrivals and prices data from 29 big cities from major states and Delhi revealed that arrivals of common vegetables in mandis have actually gone up since November 8, the day demonetisation was announced. Further, there has been a boost in arrivals of vegetables in many cities, including Chennai, Kolkata, Mumbai and Pune among others.

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Wholesale traders in Delhi told TOI that cash payments were possible in bigger cities, and not in small rural markets. Hence, the rise in supply was seen in urban areas. The quantity of common vegetables like cauliflower, potato, tomato and cabbage reaching wholesale markets daily rose by 10-30% in the weeks after November. However, no sharp drop in prices was seen.

The TOI report added that wholesale traders may have bargained with producers to push down wholesale prices. However, they did not give the benefit to the consumers. And so, while wholesale prices crashed, retail rates were almost the same. In Delhi, cauliflower and cabbage wholesale prices fell by over 50% each, and peas and potatoes by about 40%, added the report.

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The Times of India report went on to add that onion prices have increased by 21%. "This is the rate we are getting at the mandi. The wholesalers are making money, not us," Mangat Ram, a vegetable seller in East Delhi, told the paper.