Hyderabad: The Guntur Mirchi Yard, one of Asia’s largest chili markets, has long been a lifeline for farmers. It was also the site visited by former Andhra chief minister YSR Jaganmohan Reddy recently. The sharp decline in chili prices and growing economic hardships have made it a centre of unrest. Farmers are now frustrated with mounting debts, plummeting prices and the absence of a proper safety net.
While Union agriculture minister Shivraj Singh Chouhan announced that the Market Intervention Scheme will go into procuring and compensating the chilli farmers, it remains to be seen how successfully it comes to their aid.
The ongoing crisis in the chili sector has worsened due to several factors, including extreme weather conditions, rampant pest infestations, and rising input costs. With untimely rains and the pest outbreaks reducing yields, many farmers are struggling to recover their investments. Traders, forming syndicates, have further driven down prices, making it difficult for farmers to get fair compensation for their produce.
Despite a significant increase in chili exports, local farmers have not benefited, as market uncertainties and price fluctuations continue to threaten their livelihoods.
The latest data from the Directorate of Economics and Statistics (DES) reveals a troubling trend:
This steep decline in chili production has left farmers grappling with heavy losses. Many have been unable to break even despite investing up to Rs 2.5 lakh per acre.
The previous YSRCP government had made some efforts to ensure better prices for farmers and boost exports. A record 16.10 lakh tonnes of chili were exported, opening up international markets and helping stabilise prices. Additionally, investment support schemes aimed at reducing the financial burden on farmers were introduced. The administration took steps to improve cold storage facilities and prevent middlemen from exploiting farmers. However, many of these measures have stalled under the new government, leading to growing distress among cultivators.
Despite repeated appeals from farmers, the current TDP-led coalition government had been slow to respond to the crisis. The promised Rs 20,000 crore investment assistance under the “Super Six” scheme is yet to be disbursed. Additionally, essential relief payments remain unpaid, including Rs 164.05 crore as drought relief for 2.37 lakh farmers in Kharif 2023, Rs 163.12 crore as compensation for 1.54 lakh farmers for Rabi 2023-24, and Rs 31.53 crore for 32,000 farmers affected by untimely rains in July 2024
Severe fertilizer shortages and rising costs have further worsened the situation, making it harder for farmers to sustain cultivation. Chief minister Chandrababu Naidu and his ministers have not conducted on-ground reviews yet.
Farmers have demanded urgent intervention by Naidu’s government, including the expansion of cold storage facilities to stabilise prices, strict action against middlemen syndicates and price manipulation and timely financial assistance to help them recover their losses. They have also asked for better export policies to protect farmers from global market disruptions.
Naidu government representatives met Union minister Chouhan who is learned to have directed the Indian Council of Agriculture Research (ICAR) to assess the production cost of chilli farmers, and submit a report to the Ministry of Agriculture and Farmers’ Welfare (MAFW).
Note: This report has been updated since publication.
