Israel-Iran war impact on MP farmers:Hormuz Strait closure halts exports; banana prices crash from ₹2200 to ₹1200

The ongoing America–Israel and Iran war has now begun affecting agro products from Madhya Pradesh. During the conflict, Iran has closed the Hormuz Strait, a key route through which goods from many countries reach the Middle East, including India. As a result, several Indian products are waiting for export at Mumbai port, including bananas from Madhya Pradesh. Farmers and traders are worried as bananas are rotting in fields due to low prices. Banana prices have dropped sharply from ₹2200 per quintal to around ₹1200 per quintal. Farmers and traders in Barwani, Burhanpur, Dhar and Khargone are the most affected. People associated with the rice trade said that no consignments are currently stuck at Mumbai port, but new export orders are being cancelled. Read the report on how farmers and traders have suddenly come under pressure due to halted exports, and whether any solution is in sight or the crisis could deepen further. Around three crore banana plants planted in Barwani Banana producer and exporter Santosh Lachheta said banana exports from Barwani began in 2016. Last year, around 1.6 lakh tonnes of bananas were exported from the district, mainly to Iran and Dubai by sea route. From Dubai, the bananas are transported to other countries through road networks. He added that around 2.5 to 3 crore banana plants have been planted in the district this year. Due to favourable conditions in the Narmada belt, banana cultivation and harvesting continue throughout the year. Prices crash; 20-day stock lying at shipyard According to Lachheta, banana prices have fallen sharply because of the war. Earlier, bananas were selling for ₹2000–₹2200 per quintal, but prices have now dropped to ₹1200–₹1300 per quintal. Bananas that were packed and ready for export to Iran and other countries are now being sold at a loss to Delhi traders to prevent spoilage. Jitendra Solanki of Rajlakshmi Banana Group said that around 15–20 days of banana stock is currently lying at the Mumbai shipyard. With exports halted, this stock is being released into the domestic market, putting additional pressure on prices. Farmers say – Not even able to recover costs According to farmers Mahesh Rathore and Balram Yadav, they have cultivated bananas on six acres of land. The cost per acre has been around 85 to 90 thousand rupees. Their total cost has exceeded five lakh rupees. Despite the crop being ready, buyers are not available in the market. Many farmers are having to sell their produce at prices below cost. Farmer Nitin Yadav says that under normal circumstances, about half of the district’s total production gets exported. This fetches better prices for farmers, but this time due to export stoppage, both farmers and exporters are suffering heavy losses. Banana exporters say – Hundreds of containers are standing at the port Maharashtra’s Solapur’s leading banana exporter Kiran Dhoke said that about 250 containers filled with bananas are standing at Mumbai port, continuously incurring port charges. For containers that had reached Dubai before the war started, the situation there has also changed. In many places, freight charges being collected are higher than the value of goods. Around 24 thousand metric tons of bananas are also stored in Solapur’s cold storage, which will now have to be sold in the domestic market at lower prices. He has demanded the central government to intervene and provide relief to the banana industry. G-9 variety has highest demand in foreign countries Farmer Manoj Jat said that thousands of farmers in Barwani grow improved varieties of bananas. The G-9 variety has the highest demand in foreign countries. While bananas fetch prices up to Rs 10 per kg in the local market, they sell for several times higher prices in foreign markets. Local MLA Rajan Mandloi says that Narmada belt bananas are highly preferred in Arab countries due to their sweetness and size. Due to the war, a large quantity of bananas are stuck at Mumbai port. Status of Banana Production in Four Districts of Nimar Burhanpur: The ‘Banana City’ of the State
In Madhya Pradesh, banana cultivation is done most extensively in Burhanpur district. Banana crops are grown here in approximately 22 thousand hectares of area. Due to large-scale production, Burhanpur is also called the ‘Banana City’ of the state. The district produces about 16 lakh metric tons of bananas annually, which is a major portion of the state’s total production. Dhar: Rapidly Growing Cultivation Along Narmada
In Dhar district too, the scope of banana cultivation is continuously expanding. Especially in areas along the Narmada like Manawar, farmers are cultivating bananas on a large scale. Many farmers are individually growing bananas in 150 acres (about more than 60 hectares) of area. Khargone: Region becoming an export hub
Banana cultivation is also being promoted in Khargone district. According to the Horticulture Department, work is underway to develop the district as a banana export hub and experimental cultivation of tissue culture bananas is also being done in more than 10 hectares of area.
Impact on Rice Business: Freight Increased, Advance Booking Also Stopped Vineet Wadhawan, Logistics In-charge of Dawat Foods in Madhya Pradesh, says that the company’s highest exports are to Europe and America, while exports to the Middle East are very low. Currently, none of their consignments are stuck anywhere. According to Rice Federation President Ashu Agarwal, due to the war, new orders have almost stopped, while the dispatch of old orders is also not as smooth as before. Balaghat’s rice mill operator Anish Sancheti says that shipping companies have increased freight charges and in some cases, advance bookings have also been limited or stopped. All India Rice Exporters Association issues advisory – Members should not enter into new CIF (Cost, Insurance and Freight) contracts for the Hormuz route. – Where possible, sell on FOB (Free On Board) terms so that freight, insurance and risks remain with the buyer. – Exporters should exercise restraint while taking new orders and avoid open, unhedged positions. – The top 5 destinations for Basmati (Saudi Arabia, Iran, Iraq, UAE, Yemen) are in the Middle East, accounting for 50% of India’s total Basmati exports. Therefore affected members can seek assistance from the Federation. – Basmati wholesale prices increased by 10-15% last month, and with Iran being a major market, Basmati prices may see high volatility in the coming days. Further advice will be issued as the situation evolves. (According to Dev Garg, Vice President of Indian Rice Exporters Federation)