Meher Singh of Paldi village in Haryana’s Sonepat district has sold about 15 bags or 200 kg of cauliflower for Rs 2 a kg. Each bag costs Rs 10 each; the truck charged Rs 20 a bag. So he has sold at a loss. Before notebandi or demonetisation, cauliflower was selling for Rs 10-12 a kg. “Pit gaya ji,” (I am ruined), he laments at the kisan shed of Delhi’s Azadpur mandi, reputed to be the country’s largest auction yard for fruits and vegetables.
“Jab maal hi nahin bik raha hai to kya milega,” (When the produce is not selling what will we get?) asks Jitender Khokar of Chaprauli village in western UP’s Baghpat district. He has sold about 800 kg of methi or fenugreek greens at Rs 3-4 a kg, when it should be selling at Rs 14-15 a kg to recover cost.
Bablu Chaudhary of Nangal village also in Baghpat has sold 9 bags or 600 kg of green chillies at Rs 14 a kg. Before notebandi, they used to fetch Rs 25-30 a kg. It’s been a tough day for Chaudhary. He reached the kisan shed after the truck left for his village at dawn to beat the city’s no-entry ban on commercial vehicles. So he is waiting to catch the next at the same time the next morning.
Chaudhary employs six workers to pluck chillies every 15 days. It requires deft fingers, so children are preferred. Each worker can do about 20 kg a day. Add the cost of sprays, because chillies are prone to pest attacks, the truck hire charges Rs 1 a kg, and the packing cost of Rs 0.50 a kg, and there is little left. “If chillies sell for less than Rs 10 a kg, I save nothing,” he says.
Slump in Markets
Farmers at the kisan shed can sell directly to buyers, by paying 1 percent of their turnover as market cess. Commission agents can charge up to 6 percent. But all the slots at the kisan shed are taken. Most farmers do not have a choice but to operate through commission agents.
Mohammed Zakir, a commission agent, says he has not seen this kind of mandi (slump) except during disruptive weather events like heavy rains. He has been operating at Azadpur since 1994, the shop handed down by his father. He used to sell about 20 tonnes of musk and watermelons from Anantpur in Andhra Pradesh. When this correspondent visited him, he had sold three tonnes in as many days.
Raja Babu, of a commission agency named after him, says he sells a 16-tonne truck load of melons in about three days. Rates have declined by half to Rs 10 a kg. The cost of transporting the melons is about Rs 4 a kg.
“Currency flow nahin hoga toh grahak nahin aayega (without currency flow, customers won’t come)” says Harbans Lal, a mechanical engineer, who joined his father’s commission agency about three decades ago, as his salary from the irrigation department did not cover his expenses.
Turnover Hit
Azadpur mandi is designated “a market of national importance.” It gets produce from all over the country: pineapples from Nagaland, coconuts from Kerala, melons from Andhra, and oranges from Nagpur. Though commission agents complain of bad debts and bankruptcies arising from traders defaulting on payments to them (as the agents pay farmers upfront but collect from traders later), Satnam Singh, the Secretary of the Agriculture Produce Marketing Committee (APMC) which oversees running the mandi and settles disputes, says the market is a big draw because of its credibility.
Though just 78 acres in extent, about 14,000 tonnes of fruits and vegetables on average are sold every day. There are few defaults, he says. The mandi has 2,200 commission agents and about 20,000 transactions are done daily but there are less than 10 disputes a day.
The mandi did a turnover of over Rs 9,000 cr last year. This year demonetisation is likely to make the target of Rs 10,000 cr difficult to attain. But arrivals have not been affected, Singh says. “Goods are changing hands, cash is not.”
Drop in Daily Arrivals
Data from Azadpur mandi’s website shows a mixed picture. Apple arrivals have declined since demonetisation.
In the week before notebandi, daily arrivals ranged from 2,050 tonnes a day on 1 November to 3,752 on 7 November. Apple arrivals on 9 November, a day after the announcement of demonetisation, were 3,625 tonnes. They have steadily declined.
In the first fortnight of December, arrivals ranged between 2,268 tonnes on 1 December to 1,380 tonnes on 13 December. In the last week of the month they were in the range of 1,325 to 933 tonnes.
Vegetable arrivals do not seem to have been much affected. In the six days before demonetisation in November, potato arrivals averaged 1,495 tonnes. In the first six days of December, they averaged 1,308 tonnes. In the last week, they ranged from 1,324 tonnes to 513 tonnes. Onion arrivals in the first week of November averaged 887.5 tonnes. In the last week of December, they ranged between 345 and 1042 tonnes. Tomato arrivals in the first six days of November were higher than in the last week of December.
Unlike home appliances and clothes, demand for fruits and vegetables cannot be postponed. Demand lost is lost forever. This will translate into lower farm incomes and might affect output during the next season.
Haven for Money Launderers
The slump has affected daily wage earners. Mahender Singh is a tekedar or contractor who employs a team of 20 persons to unload trucks. He has seen a big drop in income, which will blow back on those he engages.
Interestingly, the mandi has turned into a laundry for black money. Housewives in Delhi’s neighbourhoods pay hawkers a premium in old invalidated currency notes for the fruits and vegetables they buy. The hawkers in turn buy small lots from many farmers at the Kishan Shed, paying each of them a premium with the notes forced on them.
Will the loss they have incurred and the hardship they have faced translate into fewer votes for the ruling party? What can (Prime Minister Narendra) Modi do if there are a hundred thieves below him, asks Meher Singh of Paldi village. Whether his view is shared by a sizeable number of voters will be known in the coming assembly elections.
(Vivian Fernandes is editor of www.smartindianagriculture.in. This is an opinion piece and the views expressed above are the author’s own. The Quint neither endorses nor is responsible for the same.)
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