{"id":5141,"date":"2019-12-12T15:10:16","date_gmt":"2019-12-12T09:40:16","guid":{"rendered":"https:\/\/triumphias.com\/blog\/?p=5141"},"modified":"2019-12-12T15:10:16","modified_gmt":"2019-12-12T09:40:16","slug":"infrastructural-development-for-agri-commodities","status":"publish","type":"post","link":"https:\/\/triumphias.com\/blog\/infrastructural-development-for-agri-commodities\/","title":{"rendered":"Infrastructural development for agri-commodities"},"content":{"rendered":"<p><strong>Relevance: Mains: G.S paper III: Agriculture: Economy<\/strong><\/p>\n<p><strong>Context:<\/strong><\/p>\n<ul>\n<li>After two years of subdued market conditions, the prices of several essential commodities \u2014 vegetables, vegetable oils, pulses and sugar, to name a few \u2014 are heading northwards.<br \/>\n\u2022 Under the lead of palm oil, edible oil rates are markedly up as compared to even six months ago.<br \/>\n\u2022 Prices of pulses and sugar are rising too.<\/li>\n<\/ul>\n<p><b>The trend of rising prices: Analysis<\/b><\/p>\n<ul>\n<li>As far as vegetables, pulses and sugar are concerned, weather aberrations have surely played a significant role in damaging crops this year.<br \/>\n\u2022 An extended South-West monsoon and untimely rains during the whole of October have resulted in lower crop harvest, deterioration of quality and tightening availability.<\/li>\n<\/ul>\n<p><strong>Low production:<\/strong><\/p>\n<ul>\n<li>The vegetables in general \u2014 and onion in particular \u2014 have faced the nature\u2019s fury.<br \/>\n\u2022 Maharashtra, the country\u2019s largest producer of onion and pigeon pea, has faced harvest losses estimated between 30 and 40 per cent.<br \/>\n\u2022 Nationally, in 2019-20, sugarcane output is down to 378 million tonnes from 400 million tonnes, as per Union Agriculture Ministry\u2019s first advance estimate.<br \/>\n\u2022 At 8.3 million tonnes, kharif pulses\u2019 harvest is at a four-year low.<br \/>\n\u2022 The crop estimate made and released by the government in September will have to be revised down, to take into account losses that followed the October rains.<br \/>\n\u2022 In the case of edible oil, we find that palm oil prices have shown a 15-20 per cent spurt in recent weeks.<br \/>\n\u2022 India is the world\u2019s largest importer of palm oil, with annual import volume touching 9 million tonnes out of an aggregate import of 15 million tonnes.<br \/>\n\u2022 A weak rupee has added to the escalation in landed cost.<\/li>\n<\/ul>\n<p><strong>Are high food prices here to stay, or is this just a transient phenomenon?<\/strong><\/p>\n<ul>\n<li>The government\u2019s response to crop losses and the resultant price rise has been far from satisfactory.<br \/>\n\u2022 During the whole of October and the most of November, the Centre has been a mere witness to the emerging situation.<br \/>\n\u2022 This clearly demonstrates the utter lack of research and commercial intelligence on the part of the government.<br \/>\n\u2022 The market invariably gives advance signals; but those concerned should know how to read those signals and take appropriate action.<br \/>\n\u2022 The ongoing shortage and government\u2019s knee-jerk response is not happening for the first time, nor is it likely to be the last.<br \/>\n\u2022 Over the last 20 years that one has tracked, the onion crisis repeats every 2-3 years. The sense of d\u00e9j\u00e0 vu is palpable.<br \/>\n\u2022 It has carried many editorials in the past on the onion crisis and proffered practical suggestions for minimising the price shocks.<br \/>\n\u2022 But successive governments failed to address the core issues and to prevent the repetition of the crisis.<br \/>\n\u2022 Whether this was by design or due to indifference is hard to tell.<\/li>\n<\/ul>\n<p><strong>steps ahead: <\/strong><\/p>\n<p><strong>Invest in infrastructure:<br \/>\n\u2022 It is critical for the State governments to invest in storage infrastructure for onions, especially at the large producing centres.<br \/>\n\u2022 The onions are not highly perishable, they lend themselves to storing in what are called \u2018cool chambers\u2019, which are low-cost but effective underground storage chambers to extend the life of the produce.<br \/>\n\u2022 Land available at APMC market yards can be utilised to build the cool chambers. Irradiation can help eliminate infestation, if any, and extend the shelf life of the produce.<\/strong><\/p>\n<p><strong>Promote value addition:<\/strong><\/p>\n<ul>\n<li>The onion market often alternates between glut and shortage, because of which growers are the worst affected.<br \/>\n\u2022 In order to stabilise prices, it is necessary to set up processing facilities. The onion is used as an ingredient for a number of products.<br \/>\n\u2022 Dehydration facilities will help capture value. Institutional consumers will be the target consumers of the dehydrated onion.<\/li>\n<\/ul>\n<p><strong>Continue foreign trade:<\/strong><\/p>\n<ul>\n<li>Banning export, as it happens in times of shortage, is a bad idea. Any restriction on export of agricultural commodities is anti-grower.<br \/>\n\u2022 We must keep both the export and import windows open all the time.<br \/>\n\u2022 Through the judicious use of tariffs (customs duty), policymakers will be able to encourage or discourage export-import activity in onion.<\/li>\n<\/ul>\n<p><strong>Way ahead:<\/strong><\/p>\n<ul>\n<li>Reducing the long supply chain that adds cost and provides little value will mitigate the price risk.<br \/>\n\u2022 The farmer-producer organisations and consumer cooperatives can work together to reduce the role of middlemen and create a \u2018win-win\u2019 situation for growers and consumers alike.<br \/>\n\u2022 The policymakers have to be alert and alive to the situation. Often, they shut the stable after the horses have bolted. Delayed intervention does not help the stakeholders.<br \/>\n\u2022 To be able to take proactive steps, the government needs to strengthen its research and commercial intelligence capabilities.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Relevance: Mains: G.S paper III: Agriculture: Economy Context: After two years of subdued market conditions, the prices of several essential<\/p>\n","protected":false},"author":1,"featured_media":3247,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[123,42,43],"tags":[392],"class_list":["post-5141","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-current-affairs","category-general-studies-iii-technology-economic-development-bio-diversity-environment-security-and-disaster-management","category-indian-economy","tag-union-public-service-commission-upsc"],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/posts\/5141","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/comments?post=5141"}],"version-history":[{"count":1,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/posts\/5141\/revisions"}],"predecessor-version":[{"id":5142,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/posts\/5141\/revisions\/5142"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/media\/3247"}],"wp:attachment":[{"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/media?parent=5141"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/categories?post=5141"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/tags?post=5141"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}