Onion prices are most likely to skyrocket in October-November this year like they did last year. This may expose the absence of a policy paradigm to ensure the price stability of India’s staple vegetable.
The wholesale prices of Onion have almost doubled to Rs 29/kg as of 8 September from Rs 12/kg on 28 August, at Lasalgaon, the country’s largest wholesale market for onions. The prices have touched Rs 50 per kg in Mumbai and Pune, and even Rs 60 per kg in Delhi. The farmers are complaining that large-scale crop damage has dented their profitability. Many traders said the prices are further expected to increase to Rs 100/kg over the next month.
Buddhi Raja Singh, a wholesale trader of onion and garlic in Azadpur Mandi, said, “The current increase in onion prices is due to a decline in arrivals and excessive rains damaging onion crops stored across Maharashtra, Karnataka and Andhra Pradesh, three major producer states in this season.” He further added “Rs 100/kg in October as the new crop is expected to arrive only in November. At present, the onion arrivals in the market are not of top quality which will further increase the prices to attract quality onion supply. Earlier, at least 250-300 tonnes of A-grade onion use to arrive daily in the mandi but it has declined to just 50-70 tonnes per day since late August”.
Nana Saheb Patil, director of the National Agricultural Cooperative Marketing Federation of India (NAFED) in Maharashtra said “Heavy rain in mid-August in Satara, Pune and Nashik has led to moisture damage in stored onions and as a result, their quality has deteriorated. Farmers are complaining around 35-50 percent damage to their stored onions across Maharashtra.”
The government banned exports of onions with immediate effect, and the efforts were on to procure onion seeds in large numbers and also release buffer stocks immediately. They are also considering to revise the minimum export price once the export ban is lifted. The government wants to ensure that there is enough onion seed made available to the farmers for the late Kharif and rabi season and for that they are looking at procuring onion seeds.
Besides, the government has also asked state-owned NAFED to immediately release 500 MT of onions into the market especially, in cities like Mumbai, Delhi, Kolkata, Hyderabad, Ahmedabad, Pune, and Indore at mandi rates to meet the demand.