HP Apple in Sesquicentennial Jubilee: Gambling or cash crop
Shimla, Sep 19 (UNI) Himachal Pradesh Apple has completed Sesquicentennial Jubilee last year currently facing a tough challenge as the growers no longer consider it’s cultivation cash crop.
Rs 5000 Cr plus Economy is more volatile than share market and some of the farmers equate this with Gambling.
The unchecked and constant inflation phenomenon under the present order not only increased the cost of production but uncertainty in the Market, dominance of middleman and increasing monopoly of corporate to crash market artificially are posing new burning issues threatening the livelihood of around four lakh households and around three lakhs farm skilled workers engaged in it.
Himachal Pradesh Government claimed that around 3.49 Cr(616885 metric tonnes ) Apple boxes are likely to be produced this year.
In mid season as many as 1.90 Cr Apple boxes are already sold in the market as on Sep 17, 2021. In terms of metric tonnes it is around 344730 mt whereas under HPMC(Himachal Pradesh Horticulture Produce and Marketing Corporation) and HIMFED(Himachal Pradesh Marketing and Consumer Federation) has precured about 37000 metric tonnes of ungraded apple in the season.
Currently, a 20 kg carton of A-grade Apple is fetching price of Rs 2100 to Rs 2300 whereas B -grade at Rs 1400 to 1600 in the local market. 90 per cent crops are being sold in the domestic market.
State recorded around 407000 mt apple production in the Financial year 2020-21, 715250 mt in 2019-20 and 368600 mt in 2018-19.
The credit goes to an American Christian missionary Mr. Evan Samuel Stokes, to further popularise it in Kotgarh area of Shimla district as in 1916, he introduced delicious varieties like Royal Delicious, Red Delicious and Golden Delicious still in production in major chunk of state apple orchards.
In the last 150 yrs Kullu district recorded migration of apple crops from Bajoura to high elevation. District cultivars first brought by the British include Baronies Rich, A Red, Mackintosh and Ambari etc.
Agriculture experts said that apples grown from the exotic cultivars of Kullu were more sweet but also had a pungent taste compared to Royal Delicious, Red Delicious from Brothers Nursery of Mr. Stokes (USA) who later came up with varieties of Golden Delicious apples.
People were not in favor of growing apples initially as they were cultivating traditional millet and pulses crops however there were no commercial crops.
First Chief minister Dr Y S Parmar encouraged people of this hill state to plant trees as natives were not in favor of planting even an apple tree in the middle of their fields, as it made ploughing difficult for the farmers used for growing grains etc.
Most apple trees were grown through seedlings and transplanting, which took 7 to 12 years to come in gestation and bear fruit. The trees were also very large and only about 250 trees could be planted in an acre of organic apple gardening. Apple horticulture was initially being done organically.
No chemical fertilizers and pesticides were being used in the apple orchards. Cow Dung based naturally decomposed manure was the fertilizer given to the tree twice a year.
For this reason there was no disease in apple trees and fruits. The trees were of large canopy and gave 25 to 40 buckets of fruit per tree.
Transport was a major challenge at that time as National Highway -22 which is now called Hindustan Tibet National Highway -5 ( once called old silk route) was not adequately developed before independence and mules were the main source of transport till Shimla town.
With Shimla being the summer capital of British India, apple horticulture in the Kotgarh region was soon noticed by the British government.
Mr. Stokes was helped to sell apples from Himachal Pradesh to Punjab and Delhi with various representations.
Even after independence, Shimla remained the center of apple trade with the help of the central and state government and improved roads and apple cultivation started growing.
Reasons for choosing Shimla for apple horticulture was due to natural environmental factors, Mr. Stokes chose Himachal Pradesh, especially Shimla district, for horticulture of the American cultivars.
In the state, early cultivars of apples mature for harvest in the month of July at low belt and peak ripening from low altitude to mid altitude in August and high altitude ripening starts in the month of September.
Apple is not still in everyone’s reach however current production could not attract the remunerating prices to growers.
It hits stalls of fruit Markets when mango season comes to an end in the country. The long-lasting and good shelf-life attributes to make it one of the best cash crops in Country. With advances in food storage, processing and packing technology it added to its shelf-life and domestic produce remained available to people round the year.
However every year in two-and-a-half months till September 15, the apple of Himachal Pradesh rules the Indian market of fresh fruits.
Kashmir apple season starts from 15th September and there is a huge influx of apples in the Indian market, so Himachal Pradesh apple prices go down by Rs 400-500 per box.
Economics of Himachali Apple:
The apple growers of Himachal Pradesh get an average price of Rs 1800 to 2000 per 20- 25 kg box during the period from July to 15th August, as there is no fresh apple plucking anywhere during this period.
However as apples from the mid-belt start pouring in, the prices start sliding down drastically.
Traders also initially pay high prices to attract growers, moreover no merchant pays the gardeners cash for the crop. There is a minimum credit period of 7 days to 15 days for farmers and some established traders make payment even after 30 days to 45 days.
Hence the crashing of the market with plunging its prices, traders decide the average buy price for the next day.
Market keeps on changing inbetween with festival season, the buying price from Monday to Wednesday has been given slightly higher.
Small lots like 25 boxes to 40 boxes are bought at higher prices if the quality is good, which immediately sends positive messages of high market value to the gardening community through social media, print media and digital media.
In such a situation, gardeners start harvesting immature crops. Ethereal is sprayed to get good color to the crop situated at low and mid altitude, it gives good color to the fruit but the fruit remains immature, which gets damaged during transportation and can be used for apple production and high production in local markets.
Markets fall due to inflows. Another reason for the low price of Hilling is a regular affair in the mountains, as so far only 10 per cent of the apple production area is covered under anti hauling nets and anti hail guns.
This is another factor that drives down the market prices of apples. The government procurement of apples starts as soon as apples come in the market. The government does not buy many apples under the MIS scheme.
This year also the state government has procured apples worth only 2.5 crores boxes under MIS schemes.
Adani Agrifresh Big Leader As of now there are few compressed atmospheric stores in Himachal Pradesh, in which fresh apples can be stored for 6-9 months.
Adani Agrifresh is the leader having 3 CA stores at Beethal Rampur Bushahr, Sainj Kotkhai and Mehndi Rohru with 5000 MT capacity each.
Adani recently expanded its CA store to add additional capacity across all three sites.
No place for growers in stores Apart from Adani, Him Agrifresh, Suri Agri Fresh Gumma, JCO, ICL, Aradhana CA Store Sainj are some of the major CA stores.
All these stores till now store only 10 per cent of the total agricultural produce. Since Adani buys its own stock, they do not provide any space for the growers to store their apples.
JCO, Agro Fresh, Suri Agri Fresh and ICL also do their own procurement and do not give any space to the gardeners to keep a stock of apples for sale in the off season.
Apple storage system
The Harshana Group is primarily active in Kashmir, but also buys apples from Himachal Pradesh and stores it in its CA store near Sonepat, which is one of the largest suppliers to ITC.
Agrifresh was a pioneer in providing apples for off-season stores, but growers no longer prefer to store apples there after an issue of apple mishandling.
There are alternative stores built by private companies at Parwanoo and Baddi in Himachal Pradesh, Kharar and Rajpura in Punjab, which cater to the demand of gardeners at the rate 80/- per kg on rental basis for a minimum period of three months.
Kilograms are provided at the rate of Rs 1.25 per kg Adani Agrifresh is now the largest influential group in the apple business in India, as it is now the largest stockist of apples in Himachal Pradesh.
Once the fresh and healthy venture of Indian Railways in Government Sector and successful brand of Mother’s Dairy were the biggest buyers of apples of Himachal Pradesh but now they are not buying apples directly from the orchardists but Adani Agrifresh is supplying and procuring them.
Kundli is using their CA store on the Haryana border to store the apples. Apple trade unfavorable in Parwanoo, Baddi HPMC also has CA storage facility, but in most CA stores the prime space is occupied by the gardeners rather than the traders.
Most of the CA stores are in Shimla district, a 500 MT capacity store is also located near Bajaura in Kullu district.
There are CA store facilities at Parwanoo and Baddi in Solan district, but they are not conducive to apple business.
BBN Transport Union, which has 8000 trucks, charges around 2 lakhs transport cost per 20 metric tonne from Baddi to Chennai, whereas from Shimla or Narkanda the maximum cost per 20 metric tonne is around 1.75 lakhs.
Old Technique of Buying Apples on New Players Players like ITC, Mother’s Dairy, Mahindra Univeg Fresh and Business to business (B2B) are also in the business of fresh apples for many years.
B2B and B2C players such as Big Basket, Amazon, Superplum, Udaan, Absolute Foods and Way cool Foods have also jumped in apple buying and trading this year.
The entry of many players into the apple business led to an improvement in apple prices, but it is of no use to the orchardists of Himachal Pradesh, as all the apple players are in the business of buying apples on credit despite being well funded.
Using the same old technology. Gardener in profit and consumer in loss Every stakeholder in apple business except apple gardener and consumer like cartons and other essential ancillary manufacturers, fertilizers, chemical companies, transporters, traders, loaders, laborers and buyers earn good profit every year. The consumer always pays the higher price and the farmer always sells the apple at the lowest price of Rs.12 per kg.
The gardener pays 6 per cent commission to the trader for selling his produce, for which he has to wait for payment for a minimum of 7 days to 3 months.
In addition to commission, the merchant also deducts loading and unloading charges around 20/- per box and office expenses. Traders working through mandis also charge four to six commissions from buyers.
Man-made disaster is price crash. Gardeners also buy all inputs like fertilizers and agrochemicals on credit, so they have to pay higher prices to fertilizer and agrochemical shopkeepers after receiving payment for the sale of apples.
The price crash is a man-made disaster, which is woven every season by cartels of traders, loaders and transporters.
The APMC management and administration are well aware of this, but no action is taken due to political reasons.
Features like waiting bridge, data recording and market intelligence are lacking. The waiting bridges installed at Khesgasu and Solan Mandi are not in working condition despite spending lakhs of rupees.
According to the APMC Act, market fee is charged from gardeners for selling their produce, which is to be invested for construction and maintenance of rural roads in the district, but there is no record of how much fee has been collected.
The actual data of the total number of boxes that have been taken out of the state is available with the APMC, Agriculture, Horticulture, Revenue and Statistics Department of the state government.
Open loot due to over packing According to the rules a farmer has to pack the net weight of 20 kg apples in cartons, but farmers have to pack at least 25 kg apples in 100, 125, 150 and 175 counts, minimum 28 kg apples in 240 counts, 32 kg in 310 counts.
Traders are pressing Farmers to pack 35 to 40 kgs of apples, which is an illegal act and no one pays attention to it every season.
Over packing is open loot from gardeners by traders on one hand and on the other hand over packing also damages apples while transporting over long distances.
Transporters also have a big share in the robbery apart from traders, transporters are also one of the biggest participants in this robbery, as no one pays GST on receipt, no one pays the bill of transport.
This business is entirely on cash, which is a huge revenue loss to the government.
In addition to the fixed prices for transport per box to all major locations in India, trucks always charge an additional Rs 20 per box to pay commission to aggregators and to manage state police expenses during interstate travel.
In Himachal Pradesh, maximum 20 per cent of the transportation cost is paid by the merchants in the form of advance, which is done in cash and the remaining 80 p c payment is always paid by the buyers in different cities, that too in the form of cash payment is done.
State Mission for Food Processing Till now nothing constructive has been done for the management of this 5000 crore annual business of Himachal Pradesh.
Under the State Mission for Food Processing, a flagship scheme of the Ministry of Food Processing, Farmers Societies, FPOs and Farmer Associations together set up CA Stores with small capacity of 750 MT to 1000 MT of apple grading, sorting and packing facilities on 3 bighas of land.
So that they can store 35000 apple boxes to 50000 apple boxes in the event of a market price crash.
For handling C grade apples apart from the CA store, small apple dehydrating crops and small pulp units can be set up within the CA store premises.
Demand for processed or dehydrated apples Dehydrated apples have a good demand in the local market as well as in metro cities of India.
C grade apples are sold to HPMC at the rate of Rs 10 per kg and for the same the gardener does not get paid in cash, but under barter system HPMC sells only some of the produce to the gardeners.
If this apple is processed, the gardener can get a price of about Rs 100 per kg. Apple pulp is also in high demand in the bakery and flavoring industry, and small food processing industries also procure it to make mixed fruit jams and other confectionery products.
C grade apples cannot be transported over long distances, so it can be processed or dehydrated into pulp to extend its shelf life for years.
No arrangement for apple business in off season The Association for Quality, Management, Marketing and Processing of Apples has not made any contribution so far.
This needs to be seriously considered by the stakeholders of Apple.
Market linkage should be supported to sell processed apples, fresh apples and stored apples in the off-season.
The Himachal Pradesh government has set up a food processing park in Una district along with Cremica, but this place is about 11 hours from Kinnaur and about 8 hours from Chirgaon.
Preparation for setting up food processing park Himachal Pradesh Industries Department is making efforts to set up five Food Processing Parks at Mandi, Kangra, Solan, Shimla and Sirmaur under MSME CDP program.
HP Agro Industries is also studying the feasibility of setting up food processing under PPP mode at Parwanoo in Solan district and Kandrodi in Kangra district, which can prove to be milestones for the management of food waste and help farmers in their unrestricted agriculture.
Can provide good value for the produce.
Steps to be taken by HPMC HPMC, a state-run corporation that is leading fruit processing in Himachal Pradesh, will have to revamp its Parwanoo and Nagrota Bagwan plants, which have become defunct due to outdated technology and machinery, with the latest technologies and machinery to regain its name in fresh juice production. These bodies could do simultaneously, the need of the hour is to revamp the HPMC booths set up all over India including Himachal Pradesh with a new product line for marketing the processed products prepared by local entrepreneurs and SHGs in Himachal Pradesh in association with PDS stores.
UNI ML GNK