Telangana's Storage Gap Forces Farmers to Sell at Loss Despite Record Harvests

For most farmers, a good harvest brings relief. For Alli Srinivas, it marks the beginning of a different struggle.

After months of tending to the chilli crop on his 10-acre farm in Ramannagudem village of Telangana's Mulugu district, Srinivas had hoped the season's produce would help him recover from two consecutive years of losses. But he quickly made up his mind: this time there would be no holding back stock in anticipation of a better market, and no gamble on future returns.

The 47-year-old sold his entire produce soon after harvest, using the proceeds to clear mounting debts rather than invest in storage and wait for prices to improve.

“Normally, we transport our chilli produce to private cold storage units near the Enumamula agricultural market yard in Warangal, nearly 120 kilometres from our village. But this year, we were forced to sell immediately after harvest. Transport and storage costs are high, and when prices do not improve, farmers end up bearing the burden,” he explains.

Srinivas' story reflects a larger challenge confronting chilli farmers across Telangana's Godavari belt. In villages where chilli occupies nearly 70% of the cultivated area, farmers often find themselves trapped between low market prices and the high cost of preserving their produce. The nearest cold storage facilities are mostly located hours away, forcing growers to spend additional money on transport and storage at a time when they are already under financial strain. When prices fail to recover, the cost of waiting can become another burden. Many farmers are left with little choice but to sell immediately, even when market conditions are unfavourable.

A government-run cold storage facility closer to home, Srinivas believes, could make the difference between a profitable season and another year of losses. The proposed government cold storage units will allow farmers to store their produce for up to two to three months at a nominal fee, giving them the flexibility to wait for more remunerative prices.

For Telangana, the issue extends beyond chilli farmers and cold storage alone. What is at stake is the State's ability to support a rapidly changing agricultural economy, one that is producing more foodgrains and horticultural crops than ever before.

Over the past decade, Telangana has emerged as one of India's leading agricultural producers. Paddy procurement touched a record 147 lakh metric tonnes (MT) during the 2025-26 season, while total foodgrain production crossed 236 lakh MT. The State is also steadily expanding cultivation of fruits, vegetables, spices and other high-value crops, adding to the demand for specialised storage facilities.

But higher production alone does not guarantee higher incomes. Agricultural experts note that harvest gains can quickly disappear when farmers are forced into distress sales due to inadequate storage facilities.

Recognising this growing gap, the government has set an ambitious target of creating an additional 50 lakh MT of warehousing capacity and 50 lakh tonnes of cold storage capacity across the State. At the centre of this effort is the Telangana State Warehousing Corporation (TGSWC), which was established in 2015 post bifurcation of Andhra Pradesh and is expanding beyond its traditional role of storing foodgrains to build a wider network of warehouses, cold storage facilities and logistics infrastructure.

According to TGSWC chairman Rayala Nageshwar Rao, the corporation's warehouses have been operating at near-full capacity for the past three years, reflecting both rising procurement volumes and increasing demand for storage space.

“Our extensive network has enabled the State government to support procurement of paddy and maize on a large scale,” he says.

Currently, TGSWC manages about 38 lakh MT of storage capacity through a combination of its own warehouses and other facilities spread across the State. Officials say this is the highest capacity achieved, but it still falls short of the growing demand. The planned expansion aims to bridge this gap and reduce farmers' dependence on distant private storage.