From Rs 22 to Rs 2 per kg: Middle East war sends banana prices into a freefall

Bhagwat Holkar, a farmer from Karmala in Solapur district, has 10 acres under banana cultivation and says he invested roughly Rs 20 lakh last year on fertilisers, drip irrigation, and other inputs. “The highest rate I got was Rs 22 per kg in February. But as the war started and exports were curbed, harvest across the state got diverted to the domestic market and prices crashed,” he said. At current rates of Rs 2-3 per kg, Holkar estimates he will recover only Rs 2.5-3 lakh – a loss of over Rs 17 lakh.

The crisis has taken a human toll as well. Holkar recounted that a farmer from Karmala recently allegedly died by suicide, after a trader took his harvest but was unable to export it and never paid him. Mounting debts to moneylenders, combined with no income, pushed the farmer to take the extreme step. “I am now planning to put a rotavator over part of my field and switch to sugarcane. We cannot rely entirely on bananas anymore with the market unreliability,” Holkar said.

In Baramati, farmer Kishor Karande, who has one acre under banana cultivation, said the economics have simply stopped making sense. “The prices are so low that I cannot even recover the cost of transport and labour. I have decided to destroy the plantation and prepare the field for sugarcane,” he said.

Karande pointed to a glaring disparity that frustrates farmers: “While in retail, consumers pay Rs 50-60 per kg, farm-gate prices have hit rock bottom. Traders should pay us a fair price so that we can at least survive,” he said.

Hanuman Dake, a banana farmer from Jalgaon, echoed the concerns shared across the sector. “With the cost of cultivation – fertilisers, pesticides, labour, irrigation and other inputs – rising even as income has fallen sharply, many farmers are struggling to repay debts and keep their operations going. It has become very difficult to sustain,” he said.

The crisis has also disrupted harvesting operations in many areas. With containers stuck in cold storage and no viable market, farmers in parts of Solapur are using rotavators to plough their standing banana crops into the soil, turning their entire plantation into manure rather than sell at a loss.

Banana cultivation is a year-long investment, making the crop particularly vulnerable to sudden price shocks. Unlike seasonal vegetables, farmers cannot simply move on to the next crop without absorbing losses from the one they have already spent months and lakhs of rupees nurturing. Now farmers are calling on the state and central governments to step in with compensation and explore alternative export destinations, rather than the UAE, Iran, and Iraq, among others.

Ankush Mane, Director of Horticulture at the Commissionerate of Agriculture, Pune, said, “Apart from crop insurance cover provided after assessing damage due to adverse weather events, there is no specific relief mechanism to compensate for losses arising from export curbs linked to geopolitical issues.”

He added, “Given the scale of losses across the state, any decision on a special relief package is taken directly by the state leadership, as there is no dedicated scheme under the horticulture department.”

“Banana cultivation has expanded in recent years as farmers were encouraged by higher export prices, and this year too, they planned their crop accordingly. However, the sudden disruption of exports has led to the current crisis,” he said.

An official from the Maharashtra State Agricultural Marketing Board (MSAMB), Pune, said, “The fall in prices is due to multiple factors, including quality deterioration caused by rising temperatures and other issues, and not solely because of export curbs. There is also no scheme under the agricultural marketing department to address losses arising from international tensions.”

He added, “India’s domestic market is large, and most of the produce is sold within the country. However, the sharp decline in wholesale prices is being driven by traders, leading to significant losses for farmers.”

“Amid trade disruptions, the Centre waived ground rent for stranded containers at ports, reduced plug-in charges for refrigerated containers by 80 per cent, and launched the RELIEF (Resilience & Logistics Intervention for Export Facilitation) scheme in March to support exporters facing logistical disruptions and increased costs due to the West Asia crisis,” the official said.