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By: derebail2008 | Posted: Oct 22, 2008 | General | 906 Views (Updated Oct 22, 2008)

If one goes through the supply vs price equation of prime commodities in the market place, there is a clear indication of manipulation by the middlemen and intermediaries. I was privy to a reliable data source which clearly indicates the trend of flow into the market place at whole sale level.


The price of Tomato which was prevailing @ Rs 4/ on whole sale level last year October and on retail let us double it @ Rs 8 considering the wastage. This year the supply figure is almost double from last year and the price has double to Rs 9 @ whole and @ retail if one considers it has to be Rs 20 on doubling, but the price is @ Rs 30/- for a hybrid or salad tomato which is the cheapest. For desi variety it is almost Rs 40/- This is a clear indication of the level of manipulation of prices despite increased supplies. I am wondering whether the market watchers or buyers in malls are really tracking the prices or blindly going by the brokers.


If we consider Onions it is interesting that the prices prevailing last year on wholesale level @ Rs 9 and retail @ 12. despite abundant supply. This year there is shortage of supplies but prices seem to relatively under control with huge margin to intermediaries. The wholesale is @ 7.75 but on retail it is selling @ Rs 16.00. The amount of damage is relatively low, except if the weather condition becomes very humid.


Similarly Potato supplies have been badly affected due to pests raiding on the crops in karnataka. The supplies have been hit. Last year despite bumper supplies the wholesale prices were 9.00 and retail @ 15.00. This year despite supplies being hit the wholesale prices @ Rs 6.50 and retail is hovering around Rs 13.00. Once again a huge margin for the intermediaries. The farmer is getting a raw deal over here. Potato is the least affected product in storage, and despite the lowered supplies farmers realisation is low.


There is an urgent need to regulate the intermediaries, if I as a common man can make a simple analysis that the intermediaries are really swindling the consumer as well as farmers. No wonder whatever relief is furnished to the farmer in terms of loan waiver is not going to help unless he is given his due in terms of realisation. The farmer may be happy to get double in Tomato realisation than last year but consider farmers who have grown potato and onion they have lost out despite lower production levels and pests affecting their crops.


The logic of supply and demand does not apply to commodity pricing at all. It really baffles me. In case of supply of plenty the prices are treble and in case of short supplies, the price line is maintained. It is bound to move up as the election nears. This will definitely affect the ruling party's fortune in the election. The traders will take the consumers and farmers for a ride. We may again land up with more suicides from the farmers, whereas the trader will be shedding a crocodile tear for a life lost. The governments waiver is just a futile exercise in providing succour to the farmers. We as consumers have to pay up for the elections for all the follies of the Political compulsion. Why not have elections once in 10 years.



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commodity, watch
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