Market Dynamics of Byadgi Chilli: Trends in Arrivals and Prices in Karnataka, India

Abstract

Byadgi chilli, a prominent variety of dried red chilli cultivated in Karnataka, is widely recognized for its deep red colour, wrinkled appearance, and low pungency, making it highly desirable in the food and oleoresin industries. Owing to its Geographical Indication (GI) status and economic importance, this study examines the market growth rate, price trends, and arrival patterns of Byadgi chilli in three major markets—Bangalore, Hubballi, and Byadgi—over the period from 2002 to 2024. Using Compound Annual Growth Rate (CAGR), instability indices, and regression analysis, the study identifies major fluctuations and market dynamics. In Bangalore, the CAGR for arrivals was 5.59%, with a high instability index of 43.63%, while modal prices grew at 6.63%, but with extreme volatility (instability index: 115.83%). Similarly, the Byadgi market experienced comparable trends, highlighting a decline in arrivals over the last decade despite strong price growth. Hubballi, however, exhibited the highest CAGR in arrivals (7.22%) and relatively lower price instability, suggesting more stable market conditions. Findings suggest that while demand remains strong, supply inconsistencies and market volatility are major challenges, particularly in Bangalore and Byadgi. High price fluctuations, linked to supply shortages, inflation, and speculative trends, pose risks to both producers and consumers. The study highlights the urgent need for better market linkages, improved storage infrastructure, and policy interventions to ensure price stability and enhance supply chain efficiency. These insights can guide stakeholders in designing robust strategies for sustainable growth in the Byadgi chilli sector.