Analysis of market arrivals and prices of tomato for price prediction in Karnataka state

Fluctuations in market arrivals largely contribute to the price instability of major agricultural commodities. There is thus a need to have perfect understanding about the arrivals and price behavior. Hence, the present study focuses on gaining insight into behavior of market arrivals and prices of tomato over the years in to one of the most important tomato markets in South India and provides a feasible solution for mitigating price fluctuations in highly perishable horticultural commodities. It is seen that ‘Kolar market’ located about 70 kms from Bangalore city receives the highest supply of tomato every day in comparison to most other markets across the region. Unlike a typical market equilibrium situation where arrivals and prices follow inverse relationship, the prices of tomato in Kolar market sometimes showed direct proportional relation. Variation in arrivals to Kolar market was observed most stable or in line with the average annual arrivals during July to September which seems to coincide with the Kharif season and more stability in arrivals can be observed during this season. The seasonal variations in arrivals were observed highest in four months and prices were also followed seasonal during this period. However, the arrival and price patterns changed over the years suggesting a need for price forecasts. The research team through a nationwide Network Project on Market Intelligence has analyzed the arrivals and prices using econometric methods such as ARIMA and has been providing predicted prices every season to Kolar farmers prior to sowing and prior to harvest. These predicted prices which were in 90% coincidence with the actual market prices and the farmers and traders’ expectations and thereby benefited the farmers in taking informed decisions on area allotment and market selection.