Onion continues to bring tears to farmers, traders; govt worried in politically-sensitive Maharashtra

Tribune Web Desk

Vibha Sharma

Chandigarh, March 6

Upset over the wholesale prices ofonion, farmers and traders are continuing with their protests in Nashik, Maharashtra. According to reports, farmers say the procurement by NAFED is “not satisfactory”.

Monday, in fact, saw visuals of a farmer taking the extreme step of setting on fire his one and a half acre onion crop.

Worried over the falling prices inLasalgaon, Asia’s largest onion trading hub, the Consumer Affairs Ministry on Friday had asked NAFED to purchase the surplus and sell it in non-onion growing states to maintain the demand-supply equilibrium.

Incidentally, the price of onion in Chandigarh is currently ruling at around Rs 25 per kg.

However, at Lasalgaon farmers are selling the crop at around Rs 400 to Rs 500 per quintal against previous year’s Rs 2,000 to Rs 2,500 per quintal.

Last week, farmers had forced Lasalgaon to shut down auctions, claiming that at these rates they would not even recover their input cost.

No restriction on exports: government

Meanwhile, the Centre on February 26 also clarified that there are no restrictions or prohibitions on the export of onions from India.

“The Government has not restricted or prohibited the export of onions. The extant export policy of onions is ‘Free’. Only the export of onion seed is ‘Restricted’ and that too is permitted under authorisation from DGFT.

“Notification No. 50 dated 28.12.2020 amended export policy of Onion (of all varieties) in cut, sliced or broken in powder form and Bangalore Rose onions and Krishnapuram onions excluding cut, sliced or broken in powder form from ‘prohibited’ to ‘free’,” it added stressing that $ 523.8 million worth of onions were exported from April to December 2022.

However, even though there is surplus onion available in India, some traders are still said to be importing from Bangladesh, leading to a demand for change in import policy as well.

Reasons for fall in prices-climate and temperature

Apparently, good monsoon rains last year led farmers in other regions to plant onions.However, rise in temperature in Maharashtra in February made late Kharif harvest prone to damage, leading to its off-loading and triggering price collapse. Normally onion is harvested in three cycles in a year.

Rabi onion which is harvested during March/April- June accounts for 65% of India’s production. It meets the demand till the Kharif crop is harvested from October-November.

While Kharif onion is sold during January, late-Kharif arrives in the market later.

However, rise in temperature forced farmers to sell late-Kharif along with Kharif, leading to oversupply and fall in price.

Lack of proper storage facilities further added to the problems.

Onion and politics

Onion is prone to volatility, primarily due to harvesting cycles. The prices of onion, whether an increase or a decrease, also ends up becoming a political issue.The government is often forced to step in to curb the increase in prices as well.

Apart from the most commonly cited example of the fall of the BJP government in Delhi due to an increase in onion prices around 1998, apparently former PM Indira Gandhi also benefitted in 1980 because of rising onion prices under Charan Singh’s caretaker government at the Centre.

Last week, the Maharashtra assembly witnessed chaos over onion prices. It is alreadya political issue in Maharashtra which is due for Assembly polls next year and sends as many as 48 MPs to the Lok Sabha. The general elections are also due next year.

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