This paper aims to highlight the disruption caused by COVID-19 in the supply-chain of major horticultural crops in Jammu and Kashmir, India which is the most important economic activity in the Union Territory. The paper studies the impact of COVID-19 on the pre-harvesting, harvesting and post-harvesting stages of horticultural supply-chain. Primary Data was collected through the telephonic survey whereby the farmers acknowledged delay in spraying the chemicals and fertilizers which has resulted in increase of pests and weeds in their farmers, This is likely going to impact the quantity as well as quality of the horticultural crops in Jammu and Kashmir. Another group of the respondents, who had stored last year’s produce in Controlled-Atmosphere-Storages (CAS), have failed to find any buyer due to closure of the markets and the consequent fall in demand. The transportation and the storage cost of their stored produce is increasing with each passing day, therefore gradually eroding their profitability. Moreover, the cherry farmers who had reaped a good harvest couldn’t find the buyers and therefore had to dump their produce hitting the economy badly. Longevity of COVID-19 and the subsequent lockdown is severely denting the efficiency of the supply-chain of the horticultural crops in Jammu and Kashmir. The profitability of horticultural sector as a whole is taking a severe hit which will impact the coming years too. With the pandemic yet to peak in India, the government should ramp up the infrastructure, provide timely input to the farmers, bring clarity in the opening of mandis and provide a financial stimulus to restore some normalcy in the sector.
The global economic impact of COVID-19 which originated from Wuhan city in China is already perceptible across the sectors (
Throughout the history, the pandemics have negatively impacted the society and the economy. The Spanish flu of 1918 which claimed upto 50 million lives resulted in a loss of 6 percent GDP and a combined 8 percent loss in the consumption growth overall in the world (
COVID-19 has already started a global recession as the borders are sealed from small districts to the country level. As already mentioned, the unique characteristics of the pandemic make it difficult to compare it with the global recessions like Global Financial Crisis of 2008 or even the epidemics the world has witnessed before. These characteristics like, one, it is a global pandemic impacting majorly the high-income economies. Two, the financial sector was already weak with historically low-interest rates. Three, the world is much more integrated. Most importantly, the pandemic has generated spill-over effect on the supply chains, hampering even the flow of the food-supply to the population worldover (
In agricultural sector, the spread of pandemics restricts the access to farms and markets crippling the whole system which creates challenges for mobilization of food from the farms to the consumers, thereby hampering food-security of the population. These pandemics affect the overall production of agriculture as it disrupts the input-supply- labour, raw-material and timely capital to the farmers. Ebola Virus Disease, 2014-16 in West Africa resulted in a decrease of 7 percent, 12 percent and 10 percent in the production of wheat, rice and maize respectively (Gunjal & Senahoun, FAO, 2016). Similarly, the Avian influenza virus, 2003 in South East Asia led to a fall of 15 percent in the poultry output in Thailand and Vietnam (Brahmbhatt, 2005, p.365). Moreover, to mitigate the impact of the Avian Influenza, the South-East Asian countries had culled 140 million birds which costed approximately 10 USD Billion. Consequently, the export trade of the poultry from these countries fell by 37 percent during the phase, 2004-06 (
Like other economic sector, the unique double whammy of COVID-19 is witnessed in agriculture too. There is fall in both supply and demand for food which impact agriculture substantially, so there is possibility of food-insecurity across the globe (
Farmers will be hard hit with poor returns varying from one-third the usual or a complete loss. The stoppage of inter-district and inter-state transportation will drastically hit the commercial crops as they depend on better market access and migrant labour (
Across various states of India, there are reports of dumping of the agricultural produce in mass scale. The consequent lockdown imposed in India, has already delayed harvest of the rabi crops in the states of Punjab, Haryana, Karnataka, Uttar Pradesh (
India is the fifth largest producer of Apple in the world and Jammu and Kashmir, is the leading producer of apple in the country, contributing 7075 percent to the total production in the country (National Horticulture Board, Horticulture at a Glance, 2018-19). Therefore, to study the impact of COVID-19 on supply-chain of apple crop, it is pertinent to analyze the supply chain of apple crop in Jammu and Kashmir. The supply-chain of apple is already suffering as farmers are unable to sell their produce in the market. Jammu and Kashmir economy in the broader perspective, is an importdependent export-oriented economy with a very large informal sector (
Among the major supply-chains, apple is the one of the most dominant horticultural supply-chain in Jammu and Kashmir. Apple crop contributes nearly 60% to the total horticultural output in Jammu and Kashmir, from an approximate acreage of 50 percent. In 2018-19 the production of Apple from the region was 19 lakh tonnes, which is 77 percent of the total apple production in the country (Ministry of Agriculture, GOI). Annual export of apple from Kashmir fetches 7500 crores INR which is substantial for the state exchequer (
Three main crops were selected which contributed nearly 90 percent to the total horticultural output from Jammu and Kashmir. For Apple and Cherry, primary data was collected through telephonic survey in three major apple producing districts- Shopian, Anantnag and Kulgam. Multi-Stage Random Selection Technique was used to select the:
Selection of 2 blocks, from each District. Selection of 3 villages, from each Block Selection of 5 farmers from each village.
From Kulgam District, Damhal-Hanjipora and Devsar blocks were selected. From Block DamhalHanjipora, Damhal, Gasran and Aadiguttan were selected. From Block Devsar, villages namely Akhal, Gangdaar and Sopat were selected. From District Anantnag, two blocks namely Shangus and Doru Shahabad were selected. In Shangus block, villages namely Shangus, Kihirbal and Nowgam, were selected. In Doru Shahabad Block, villages namely Kapran, Poolie and Sadiwara were selected. Finally, from District Shopian, Zainapora and Shopian blocks were selected. From Block Shopian, Pinjura, Dashipora and Kachdora villages were selected. From Zainapora Block, Hyderpora, Zainapora and Bongam were selected. The selection of the three districts was made to provide analysis of the impact of COVID-19 in areas directly affected as well as in areas indirectly affected. With the same logic, the villages from each district were chosen. Therefore, a total of 90 farmers each for Apple and Cherry were selected for the survey.
Another sample of 20 farmers/respondents was taken who were awaiting to sell their last-year produce in this spring season stored in Controlled Atmosphere (CA). This dataset is different as only 3.5 percent of total produce of 2019 was actually stored in these CAs. A questionnaire was prepared and a detailed telephonic conversation with each respondent was held to get a comprehensive picture.
Secondary data was collected from Department of Horticulture, Jammu and Kashmir to assess the production of apple crop throughout the years. Data from National Horticultural Board and Ministry of Agriculture and Farmers’ Welfare was used for understanding the importance of apple crop from Kashmir vis-à-vis its agricultural growth.
The existing supply chain of the apple crop is widely distributed and indeed very long in Jammu and Kashmir. The apple production and acreage has witnessed consistent increase throughout the last few decades. And the production is majorly dependent on certain variables universally, like cultivable area, input-output ratio, use of fertilizers, pesticides and irrigation. Considering production as the dependent variable and factors like fertilizers, pesticides, labour cost, credit-availability, market-distance and rainfall as independent variable, regression analysis was done.
The results show that the fertilizers and pesticides used by the farms considerably impact on the overall production of apple in Kashmir.
The supply chain analysis presented above, gives an understanding of the major actors and their role in the overall crop production. Analysing the impact of the lockdown on each of the actor and the chain-action, the impact on production will be visible due to COVID-19. While majority of the dependent variables have been impacted by the current lockdown, there are natural variables like rainfall and other variables like irrigation of the orchards which are independent of the lockdown. The analysis provides an insight of the viability of the supply chain in the production of the crop in Kashmir. With the current lockdown forced due to the destructive COVID-19, the paper therefore analyzes the impact of the lockdown on each of the supply-chain action and thereby the impact on the production of the apple during the pandemic.
The classification of farmers according to their landsize alongwith the total percentage of land used in cultivation of apples and percentage of the income earned from apple cultivation is presented in
The number is significant as it gives an understanding of the importance of apple-cultivation for these small and marginal farmers. The income of the small and marginal farmers from apple cultivation is however lower than the medium and large farmers, implying that there are external factors which enable them to produce at market-surplus level. However, the average income of the respondents from apple cultivation is 65 percent which is substantial for their livelihood. Therefore, any disruption in the supply-chain will directly affect the livelihood of these farmers (
Covid-19 (Coronavirus) has hit Kashmir on the onset of the spring season when the farmers are usually busy in pre-harvesting activities. These activities involve spraying of pesticides, fertilizer application and tilling of the land to weed out the harmful and unwanted plants from the orchards. This preparation stage is important for high returns and a bounty crop to the farmers, as it impacts both the production as well as the quality of the produce. The likely impact of the lockdown will affect the midstream of input supply chains such as fertlizers and seeds which will hurt the farmers (
The extent of the impact of COVID-19 Lockdown on Pre-Harvest Planning and Production
The extent of impact of COVID-19 on Marketing and Transportation of Apple
With the country in the third phase of the lockdown, 77.5 percent of the farmers couldn’t spray fertlizers, pesticides and fungicides in their orchards on time at all, while another 15 percent had to delay the spray to a large extent. Only 3 percent of the farmers sprayed on time. Due to closure of the markets, the farmers failed to reach to the distributers, while duplicate products proliferated in the market. Therefore, the 55 percent chose cheaper pesticides and fungicides for their farms completely, while 30 percent chose a mixture of the two for balancing their income as well as the expenditure. Only 15 percent of the farmers however chose quality fungicides and pesticides for their farms, which they usually would have chosen in normal circumstances. From the regression analysis, (
Tilling of the orchards, particularly around the apple trees is an important aspect of orchard management. It prepares the soil around the trees for new amendments, aerates the soil, helps the bio-activators to perform their activity for the fertility enhancement and weeds out unwanted plants or weeds around the trees. 55 percent of the farmers couldn’t till on time, as the tilling machines were unavailable, petroleum stations were closed and there was shortage of labourers in the market. Only 7 percent of the farmers have tilled on time. Labour shortage in the farms was visible in all the three phases of the lockdown for plausible reasons. One, that there were redzones and buffer zones announced which impaired labour-movement and forced home-quarantine of the farmers. Two, the farmers being aware of the contagious nature of COVID-19 were apprehensive of letting labourers work in their farms. However, in small and marginal farms, family labour is usually used and therefore, they didn’t face any major labour shortage. 45 percent of the farmers faced no challenge of labour-shortage during this phase (
The farmers are already witnessing the impact of untimely and low-quality use of pesticides and fungicides. 40 percent of the farmers witness growth of unwanted grass and weeds while another 50 percent witness increase of pests in their farms. Only 10 percent of the farmers witness minimum or no growth of weeds while only 20 percent witness no additional increase of pests in their farms. Apple crops are the most vulnerable to such attack of pests and fungi, as the taste as well as the texture of the apples plays a major role in its marketing. Further, apples with scars and scabs are graded poorly in the market which affects the overall returns of the farmers. The prevalence of monoculture among the farmers makes the orchards more susceptible to disease (
These factors are extremely significant for a quality and bounty harvest; therefore, 57.5 percent of the farmers expect a fall in their production, 12.5 percent expect that the production will likely be impacted to some extent, whereas only 30 percent of them were optimistic that the production will not see any fall. This endorses the outcome of the study by Ngegba, Bangura & Moifray, (2015), which concluded that the Ebola Virus Disease had severely affected pre-harvesting and harvesting activities in the quarantined communities. As lack of labour and pesticides spraying had caused increase in the population of the pests and rodents. Even the study conducted by Gatiso
Farmers and traders store some of the produce in November- December, post harvesting season to sell it in next March-May period to ensure that they get better price for their produce (Mir, 2013;
Controlled Atmosphere Storage in Kashmir
Nearly, 65 percent of the farmers and traders who had stored part of their produce in CAS, have not been able to sell their produce on time. The closure of the markets and the restricted movement in the
The storage cost of the produce is further creating financial problems for these farmers/traders. With each passing day the storage cost is rising which is slowly lowering their expected net return, thus eroding their profitability. 80 percent of the respondents feel that the storage cost is already ruining their profitability. Another, 60 percent of the respondents expect that with the lockdown likely to be extended, they will have to dump their produce as their cost outrun the total revenue they expect to receive even if they are able to sell their produce.
Amidst such chaos and uncertainty in the market, the production and the harvesting of the crop will likely suffer. The provision of long lockdown and the self-quarantine amongst the farmers will likely create suspicion among the farmers for hiring labourers from the adjoining villages in the coming months. According to the farmers, there are experienced workers working during the post-harvesting period in grading and sorting of the apples. There are apprehensions that some of the farmers might face shortage of those experienced workers in their farms which might affect grading of the apples.
COVID-19 will substantially affect the farms indirectly, through several channels. The effective demand from consumers will be constrained significantly due to reduction in consumers’ real incomes in the crisis. This impact will be felt strongest among perishable products such as milk, fruits and vegetables, fish and chicken which need more handing and are more elastic in demand (Reardon, EPW, 2020). The failure of the farmers (65 percent) to sell their last years’ stored apples during the crisis is a manifestation of this (Table 4). The fall in demand of apples from Kashmir is going to badly hit the 9000 crore INR industry in the Union Territory. Currently, with 3.5 percent of the apples stored in CAS, there would be a loss of 1000 crore INR even before the start of this agricultural season (
Nearly, 75 percent of the crop is exported to the rest of the country and 85 percent of the harvested crop is transported immediately in the months from October to November due to lack of cold storage and proper infrastructure (
Adequate infrastructure in the supply-chain mitigates the seasonal or cyclical disruptions as it enables farmers to store their produce for better marketing (
COVID-19 has disrupted the food-supply chain in India as well around the globe. Farmers are left alone in their fields waiting for the government support. In Kashmir, the disruption of supply-chain of apple industry is imminent. There is delay in spraying of the pesticides, fungicides and fertlizers in the apple orchards which is hurting the farmers. 77 percent farmers have already witnessed a delay in the input supplies, while nearly 60 percent have chosen cheaper products on account of restrained incomes in the crisis. 50 percent of the farmers have already witnessed an increase in the pests while another 40 percent have witnessed increase in the unwanted grass and weeds. Therefore, witnessing such unfortunate impact in the pre-harvesting phase, 60 percent of the farmers expect a fall in the production and productivity. This can be confirmed from the results in the regression analysis, which point out the importance of these inputs to the farmers.
Another batch of the respondents are witnessing difficulty in selling their last-year’s produce stored in Controlled Atmosphere. 65 percent of the respondents have directly failed to sell their produce on time and as such there are chances that these farmers might be forced to dump their produce leading to a loss of 1000 crore INR. Transportation costs have escalated to 200 percent which impacts the overall profitability of the sector. Further, the longevity of the storage increases the cost of storage, eroding the profitability of the crop.
With COVID-19 staying longer than expected, the supply chain will be disrupted for long. The current storage facilities in Jammu and Kashmir, especially the Controlled Atmosphere Storage is almost negligible at 3.5 percent. With the current harvest on the anvil in the coming months, the farmers would require better storage facilities to arrest the glut in the market. They require proper storage facilities to ensure that they supply their produce only when the demand picks up. Further, the lockdown and the spread of the virus in the rural areas might impact the labour availability during the harvesting phase. This will overall hurt the farmers.
The government needs some concrete steps to ensure that the apple industry of Jammu and Kashmir does not suffer heavy losses. First, on the priority basis the government should ensure that there are pesticides, fungicides and fertlizers available at local registered shops. The quality of these input supplies should be duly checked and duplicate products should be identified. At the Tehsil and the Block level, agricultural extension services should be started with due consideration to social distancing measures to provide knowledge to the farmers and ensure that there is minimum panic among the farmers. Second, the government should a announce relief package for the farmers, traders involved. This includes moratorium on their loans with proper holiday from the interest too. Third, the government should provide a proper plan of procuring the appleharvest of the upcoming season. This would bring in confidence among the farmers to work judiciously in their farms. Procurement by NAFED, as they did in 2019 is an important step to relieve farmers from the pressure of unavailable markers and expected lack of demand. Even if the government procures 90-100 percent of the apple produced (9000 crores), the expenditure will be just 1.5 percent of the GrossState Domestic Product (Economic Survey, 2017-18, Jammu and Kashmir). This is possible only when the central government intervenes at the right time.
The government should facilitate transportation of the already stored apple-boxes in the Controlled Atmosphere. Proper monitoring and ease of interstate movement of these fruit-laden trucks should relive the farmers in recovering some of the revenue. Agricultural Mandis should facilitate the sale and auctioning of these apples under proper scrutiny and guidelines of the health-officials. The government should also leverage the private sector and make necessary arrangement for the development of the infrastructure in order to ensure that the applefarmers do not suffer. Horticulture is the back-bone of the agrarian economy of Jammu and Kashmir, and the apple-crop is the most dominant crop in the Valley. Therefore, proper arrangements should be made to ensure that the supply-chain of apple industry doesn’t suffer.