Fruit, veggie vendors may shut shop as cash crunch continues
Local fruit and vegetable vendors are planning on shutting shop on account of the cash crunch that is prevailing due to the withdrawal of higher denomination currencies.
Frustration continues to mount between farmers who are currently offering goods at half to one-third of the prices that prevailed last week and traders who don’t have legal cash to pay, a report by ET said on Tuesday.
The report quoted Metharam Kriplani, president of Chamber of Azadpur Fruit and Vegetable Traders who said they will observe the situation for the next three to four days before taking a call to close the Azadpur mandi.
Some market players said tax authorities have raided big traders in Azadpur, a major regional hub. Others said sellers were reluctantly accepting Rs 500 and Rs 1,000 notes from large buyers, the report added.
Citing that a business cannot run in debt the traders said that even paying half amount to farmers for their sale of produce is not solving the problem as it is leading to poor supplies and lowering the purchasing power of traders.
Apple business has fallen by 30-40% as prices dropped from Rs 30 to Rs 20 kg. Onion price in mandis is in the range of Rs 5-Rs 10 a kg, while in retail, it is selling at Rs 30 per kg, the report added.
Farmers are unable to repay their loans to the mandis as consumer spends have also dropped in the past few days.
The report quoted Surjit Mandal who bought banana and colocasia plant (arbi) from Meerut to the Ghazipur mandi. “I took a Rs 4,000 loan to come here expecting to earn Rs 8,000-Rs 9,000. But there’re no buyers,” he said.
Farmers are delaying payments to labourers who cut the produce, gunny bag sellers, transporters and mandi workers.
Traders and farmers are now buying vegetables on loans and credit and putting their trust in the ‘babus’ who promise to pay them half for their produce now and the rest after a month, the report said.