Crop prices, farm incomes, and food security during the COVID-19 pandemic in India: Phone-based producer survey evidence from Haryana State.

In March 2020, India declared a nationwide lockdown in response to the COVID-19 pandemic. Such restrictions on mobility interrupted the normal functioning of agricultural value chains. For a sample of 1767 tomato and wheat producers in the state of Haryana, we study to what extent the lockdown limited access to inputs, labor, machinery, and markets to produce, harvest, and sell their crops. We quantify crop income reductions during the first months of the lockdown and analyze to what extent these are associated with borrowing and food insecurity. We find that wheat producers, for whom state-led procurement guaranteed market access at fixed prices, suffered minimal declines in income. For tomato producers-an already more vulnerable population-income fell by 50% relative to their expected income in a normal year, largely due to a steep fall of tomato prices as they shifted from wholesale markets to local retail markets, resulting in a sharp increase in local supply. Relative to wheat producers affected by the lockdown, reduced income for tomato producers was associated with an increase in borrowing and reduced food security. We conclude that targeting producers of crops that face substantial price risk and introducing policies that stabilize market prices are important in efforts to aid recovery and build resilience of smallholder farmers.

Impacts of a national lockdown on smallholder farmers’ income and food security: Empirical evidence from two states in India

In early 2020, the unprecedented nature of COVID-19 prompted India, among many other countries, to put in place stark measures to stem the virus’ spread and the cost of human lives. We analyze data from phone-based surveys on disruptions to agricultural production and food security, administered with 1515 smallholder producers in the states of Haryana and Odisha. We find substantial heterogeneity in how the lockdown affected farmers in these two states, which is likely related to existing structural differences in market infrastructure and to differences in state-specific COVID-related policies. In Odisha, where mechanization is limited, farmers spent more on labor to harvest their crops, and distress selling was more prevalent due to the absence of a well-functioning procurement system for their crops. In Haryana, preexisting market infrastructure allowed the state to sustain procurement at stable prices, limiting impacts on smallholder production. As consumers, farmers in Haryana faced more disruptions than those in Odisha, due to reduced availability of foods in the markets, whereas farmers in Odisha benefited from more diverse cropping patterns and increased local supply of foods following transport restrictions.