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Asia 10/05/2024

India: Rising Potato Prices During the National Election A worrying Development for Ruling Parties

India is in the middle of a national election, spread across seven phases from April 19 to June 4 for vote counting. A massive 970 million people are eligible to vote.

Rising Potato Prices During the National Election A worrying Development for Ruling Parties (Courtesy: PTI)

A sudden increase in the prices of essential goods can be worrying for the ruling parties, especially as it could upset budget-conscious voters from lower and middle-income groups. 

However, while other essential food prices remain stable, potato prices have spiked, causing discomfort for the ruling parties. The fresh potato harvest typically begins entering the market from November and lasts until March, with prices being lowest during this time. 

Up until the end of March, potatoes were priced around INR 18-20 per kg in retail markets. However, by April 15, prices had risen to INR 25 to INR 30 (USD 0.3 to USD 0.36) per kg in various markets. 

Based on data from the central government’s Department of Consumer Affairs, as reported by Business Standard, the price of potatoes rose from INR 17 (USD 0.20) per kg on March 3 to INR 25 (USD 0.3) per kg on April 3, marking a 47.1% increase. 

The primary cause of the rise in potato prices is a production shortfall in the two largest potato-producing states: Uttar Pradesh and West Bengal. Prices in Uttar Pradesh are higher than in West Bengal, where potato output was at least 10% lower than the previous year due to unseasonal rain in November 2023. 

In 2022-23, West Bengal harvested approximately 12.5 million potatoes. Typically, 40% of this yield is sold to other Indian states, primarily Odisha, Assam, and Andhra Pradesh. 

Meanwhile, Uttar Pradesh, with a production of 16.5 million tonnes in the same period, sells its surplus potatoes to states facing shortages like Assam, Andhra Pradesh, Karnataka, Tamil Nadu, and Kerala. 

However, the summer heatwave poses a challenge for the transportation of potatoes from Uttar Pradesh, located in North-Central India, to states in the North-East such as Assam, as well as Southern states like Andhra Pradesh, Karnataka, Tamil Nadu, and Kerala. 

Consequently, there are reports of potatoes spoiling during the extended transportation. This issue contributes to higher potato prices in Uttar Pradesh and throughout Northern India. 

Transporting potatoes from West Bengal to states facing deficits proves to be a feasible solution. Despite West Bengal’s potato production being at least a million lower than last year, prices remain more affordable here compared to Uttar Pradesh. 

As per government estimates, the total potato production for 2023-24 is projected to be approximately 58.99 million tonnes, a decrease from the 60.14 million tonnes produced the previous year. 

It is anticipated that the heightened potato prices will persist and potentially rise further until the arrival of the next crop in the market. 

Indian farmers grow potatoes twice a year, with the first crop anticipated from July to September and the second from November to March, the latter being the primary potato season.

Source

PotatoPro

Fuente: https://www.potatopro.com/news/2024/rising-potato-prices-during-national-election-worrying-development-ruling-parties


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