A 445% Price Jump Makes Tomatoes More Pricey Than Gasoline in India

A 445% Price Jump Makes Tomatoes More Pricey Than Gasoline in India By A Robin - July 10, 2023


Indian tomato prices are soaring due to adverse weather, triggering a wave of social media memes comparing the cost of the essential ingredient with anything from petrol to political influence.

A delayed monsoon, heavy rains in some growing areas and hotter-than normal temperatures last month hit output of the crop, causing a fivefold increase in prices this year. Tomatoes usually become expensive in the lean production months of June and July, but the impact this year has been exaggerated.

Tomatoes and onions are so emotive in the world’s most-populous nation that a surge in prices can trigger protests. Indeed some ruling political parties in India lost elections because they couldn’t control the price of onions, which along with tomatoes are an essential element of mainstay dishes. High food prices could also hobble the central bank’s efforts to drive economic growth and keep inflation under control.

A McDonald’s restaurant in New Delhi pasted a notice on its wall announcing the temporary unavailability of tomatoes. “Despite our best efforts, we are not able to get adequate quantities of tomatoes” that pass quality checks, the notice said. The company in India didn’t immediately respond to calls and an email seeking comment.

Social media is abuzz with tomato-related memes. One shows tomatoes racing ahead of petrol and diesel, while another says get a free iPhone with every kilogram of tomatoes. In a reference to a key opposition leader and other lawmakers joining the ruling alliance in Maharashtra — India’s wealthiest state led by Prime Minister Narendra Modi’s Bharatiya Janata Party — a YouTube video joked that buying politicians was cheaper than purchasing tomatoes.

The retail price of tomatoes in New Delhi on Thursday was 120 rupees ($1.45) a kilogram, compared with 22 rupees at the start of 2023, according to data compiled by the food ministry. By contrast, petrol was selling for around 96 rupees a liter in the capital. 

The price surge is even fueling crime. A farmer in the southern state of Karnataka reported the theft of 150,000 rupees of tomatoes, according to the Hindustan Times.

Tomato prices typically rise during June-July and then again in October-November due to lower production seasons in major growing areas, said Rohit Kumar Singh, the top bureaucrat at the consumers affairs department of the food ministry. “We call it seasonality in commodity prices,” he said. “The prices will start declining when harvesting begins from August.”

Food inflation in India probably increased to 4% year-on-year in June from 3.3% in May, Bloomberg Economist Abhishek Gupta said in a report. This estimate is based on sharp gains in prices of tomatoes, pulses and rice, according to available daily price data. 

Tomato, onion and potato prices are major contributors to volatility in retail inflation in India, even if they make up a small portion of the index, according to a study by the Reserve Bank of India. Swings in prices of the vegetables may generally be high due to their perishability, vulnerability to weather-related disturbances, and less elasticity in demand, it said.

Southern and western states, which account for almost 60% of the country’s total tomato production, send their surplus crop to other markets in India depending on the season.

As the federal government searches for a long-term solution, it’s seeking ideas from the public to develop cost-effective technologies and ensure tomatoes are available at affordable prices.  

— With assistance by Eltaf Najafizada, Gina Turner, Vrishti Beniwal and Swansy Afonso


By A Robin - July 10, 2023

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