A decision taken by the Market Lorry Tempo Owners' Association yesterday to hike transportation rates by Rs 10 per quintal is set to have a cascading effect on your already-stretched budget, with vegetable prices all set for another spike.
Members of the association admitted that the hike in freight rates would result in end consumers paying as much as 30 per cent more for vegetables.
IR Yadav, deputy secretary, APMC Market Lorry Tempo Owners' Association, said, "We have increased our freight rates today and transport companies which bring vegetables to the market are expected to follow suit. This will definitely result in a 20-30 per cent increase in the prices of vegetables."
Onion, for example, which costs Rs 100 to 110 for a 10 kg bag and sells for Rs 14 to 16 a kg in Mumbai's retail market, is expected to cost Rs 18 to 20 in the near future.
The vegetable price hike may not, however, stop there as transporters caution that retail vegetable vendors may increase prices exorbitantly in the name of the hike in transport cost.
Shivaji Bhujbal, owner of a Tempo Service, said, "We cannot rule out the possibility of retail vendors selling vegetables at exorbitant rates in the name of the hike in transportation charges." The rainy season, too, is expected to keep the prices high.
The Association has, meanwhile, attributed the hike in freight charges to the recent increase in diesel prices, which made it difficult for them to operate at existing rates, pummeled as they were by rise in the cost of vehicle spare parts, insurance and additional environment tax.
Krishna Patil, Vice President of the Association said, "A hike in the cost of transportation was inevitable. The existing transportation charges were hurting our bottom line anyway and the hike in fuel prices did not help matters. We have, however, tried to make the hike a minimal one."