An analysis of prices of major vegetables in uttarakhand

Abstract

Vegetables play an important role in ensuring food and nutritional security along with an effective strategy to boost farmers income. Uttarakhand s hilly terrain and fragmented land holdings are much better suited to vegetable cultivation, rather than to traditional cereals and pulses. The inflation rate of vegetables is the highest in the country among all commodities. Price volatility, which has been a huge concern in vegetable production, deters the producers from engaging in vegetable production, further worsening the situation. Therefore, the present study was conducted with reference to the major vegetables of Uttarakhand (potato, tomato, vegetable pea, radish and onion) to examine various dimensions of vegetable prices, viz. growth, behaviour of arrivals and prices, price volatility and price transmission. The secondary data for the study were collected for the period 2001 to 2021 from various sources. The analytical tools used to attain the various objectives were compound annual growth rates (CAGR), Cuddy Della Vale Index (CDVI), trend analysis, seasonal indices, correlation and regression analysis, inter-year and intra-year variability, GARCH model, Johansen s co-integration analysis, Granger causality test, vector error correction model (VECM) and Von Cramon-Taubadel model. Potato production saw a decline of about 1.94 per cent per annum, while no significant growth was observed in tomato production. Small growth rates ranging from 1.11 to 3.04 per cent were recorded for vegetable pea, radish and onion. Low variability was observed in area, production and yield of all selected vegetables as indicated by the instability indices (lying in the range 0-15). For all vegetables, least fluctuations were recorded for area, while production showed the most variability. Prices of all the vegetable crops under study showed an increasing trend during the study period. For tomato, vegetable pea and radish, increasing trends of arrivals were recorded in most of the markets, while for potato and onion, most of the markets witnessed a declining trend. The seasonal indices revealed an inverse relationship between the prices and arrivals of most of the vegetable crops. The results of regression analysis revealed that lagged arrivals and prices had a positive effect on current arrivals. Current prices on the other hand, had an inverse relationship with current arrivals. The intra-year variability in vegetable prices was found to be higher than inter-year variability. The prices were recorded to be highly volatile, with a tendency to meander away from mean. The vegetable markets were found to be integrated with each other. However, the integration between wholesale and retail prices was observed in only some markets indicating towards inefficiency in the marketing system. In addition to this, the presence of asymmetric price transmission from wholesale to retail level in most of the selected markets strengthens the claims of inefficient vegetable marketing system. Technological interventions are required to improve the yield of most of the vegetables to counter the declining or stagnant production. Market infrastructure needs to be strengthened by improving the warehousing and cold storage facilities. Timely dissemination of market information regarding prices is necessary to improve the market efficiency. Government interventions related to price control are necessary to reduce the asymmetry in price transmission from wholesale to retail level. newline