High packaging cost hits Kashmir apple industry hard; farmers stare at huge losses

Srinagar: Noor Mohammad Bhat, 55,  was hoping to earn enough money to make up for last year’s losses given the bumper apple crop this season. 

However, his hopes came crashing down when rates of wooden and cardboard boxes went through the roof. Leave profit aside, he is working hard to reach breakeven.

“The cost of packaging is very much high this year. I am sure that apple dealers might face immense losses if the government will not intervene,” Bhat said.

Mounting packaging cost has sent shivers across apple growers in the valley. Growers claim that the rates of the wooden boxes have doubled this year. The price of each cardboard box has increased by Rs 30 this season.

Kashmir Valley Fruit Growers Dealer’s Association said the wooden boxes which would cost Rs 55  per box last year, are being sold at Rs110-120 this season.

“Farmers have incurred heavy losses. The rates of wooden boxes have increased by more than 100 percent,” said Kashmir Valley Fruit Growers Dealer’s Association Bashir Ahmad Bashir.

What has aggravated the situation is that despite escalation the wooden boxes are in short supply

“Massive use of the poplar wood by ply industries has led to the cost escalation. This year, many new plywood industries have come up. They buy poplar trees at high rates/ It has led to the shortage of wooden boxes in the market. Moreover, the sawmill owners have also increased the rates,” Bashir said.

Similarly, the rates of cardboard boxes too have surged. “A cardboard box would cost Rs 35-40  last season. But now it is sold at Rs 60 per box. Eighteen percent GST on packaging material too has hit the industry,” he said.

Bashir said the Kashmir Valley Fruit Growers Dealer’s Association has even approached the administration with a request to revoke GST on packaging material. “Price hikes were typically between 1% and 2% annually, which was tolerable. But this year’s increase has been far higher,” he said.

This year, low rates for early varieties of apple and pears are also giving sleepless nights to the growers.

The growers said rates of pears have reduced by 100 percent, while apple prices have dipped by 30 percent.

“A box of Babgosha would cost Rs 400-600 last year. This year, the same box is sold between Rs 200-400. The growers are now skeptical about the rates of delicious, American, and other varieties which will be shipped to various markets next month,” Bashir said.

Director of horticulture Ghulam Rasool Mir was not available for comments. However, an official from the department said they are going to regulate the prices of the packaging material.