India: Orange glut causes pineapple price crash

The prices of ‘Vazhakulam’ pineapples have been falling for weeks in Kerala and farmers and retailer…

The prices of ‘Vazhakulam’ pineapples have been falling for weeks in Kerala and farmers and retailers maintain that the main reason for this is the declining prices of oranges, following the heavy continuous arrivals of the fruit from other States.

Kerala is one of the largest producers of the tropical fruit in the country. On Monday 4 January, the special green variety of the Geographic Indication (GI)-tagged Vazhakulam pineapple, which is usually bought by traders and fruit processors from other States, was priced at ₹12/kg and the green category at ₹11.

The average cost of production of a kg of pineapple is ₹17, according to Baby John, a farmer who raises the Vazhakulam variety on leased land in Ernakulam and Kozhikode districts.

This implies that pineapple farmers who have taken loans will face challenges repaying them. In turn, this should impact the agricultural NPAs of banks.

Monday’s prices are a far cry from the record high prices the fruit commanded a little over two years ago. In the May-August 2013 period, the price of a ripe fruit had shot up to ₹52, while the special green got a price of up to ₹43 a kg.

Oranges have always been priced high in the Kerala market, but now they are sold at ₹25 a kg by street vendors.

John confirmed that the spike in the demand for oranges following its price fall has directly hit the domestic demand for pineapple as well as its price.

Going bananas

He also pointed out that the increased production of pineapples and the fall in the prices of some other fruits such as bananas, had also contributed to the decline in pineapple prices.

John, a former President of the Vazhakulam Pineapple Farmers Association, estimates that there has been a 20 per cent increase in production in the current season (October to January). In the wake of receiving the Geographic Indication tag, the extra-sweet Vazhakulam variety is now extensively cultivated across the State, leading to a surge in production.

Because of the heavy decline in the price of rubber, thousands of small rubber farmers have abandoned rubber cultivation, cut the trees and leased out their lands to pineapple farmers, which has also contributed to the over production.