Supply Chain Analysis of Onion and Cauliflower in Punjab

The present study was conducted in Rajpura block of Patiala district in Punjab with a sample of 50vegetables growers. The total cost of cultivation was estimated at Rs 49563/ha for onion and Rs 34840/hafor cauliflower. The net returns were found higher for onion (Rs 74597/ha) as compared to that fromcauliflower (Rs 38072/ha). Majority of these vegetables were being disposed off through commissionagent/wholesaler (more than 90 per cent) followed by retailer and directly to the consumer. The efficiencyof the these market channels can be enhanced through competition by organized retail chains and modernizingthe vegetable market system in the state. The wholesale markets of Pune, Ludhiana and Patiala for onionand that of Shimla, Ludhiana and Patiala for cauliflower have been found integrated with price of onion andcauliflower transmitting quickly from the independent to the dependent markets. The highest elasticity ofprice transmission in onion has been observed between Ludhiana and Patiala markets with almost 90 percent of the price change in Ludhiana getting transmitted to the Patiala market. Such transmission has been100 per cent for cauliflower between Shimla and Patiala markets. The price transmission has been observedfaster in cauliflower than onion. Though a long-term equilibrium relationship exists between all the studiedmarkets in terms of weekly price of the two vegetables crops, there also exists a short-run disequilibriumbetween some of the market pairs with almost 15 to 25 per cent of the fluctuations usually getting correctedwithin a week. Greater integration in these markets may help the farmers as well as consumers of thevegetables through better price signals.