Rabi onion arrivals in full swing, but, price drop unlikely, here’s why

With rabi onion arrivals beginning in small quantities, government agencies such as National Agricultural Cooperative Marketing Federation of India...

By: | Pune | Updated: April 12, 2016 2:26 PM

With rabi onion arrivals beginning in small quantities, government agencies such as National Agricultural Cooperative Marketing Federation of India (Nafed) have been directed to prepare to begin procuring onion for the coming season under the Price Stabilisation Fund (PSF) scheme.

According to officials in Lasalgaon, one of the biggest onion wholesale markets in the country, Nafed has been directed to procure some 7,500 tonnes of onion for the coming season. According to Nanasaheb Patil, chairman, Lasalgaon Agriculture Produce Market Committee (APMC) and a member of Nafed, the organisation has only around 2,500 tonnes of storage space and is on the lookout for more.

Last year, when onion prices had touched Rs 80 per kg in some states including Delhi, the Small Farmers’ Agriculture-Business Consortium (SFAC) — which has purchased 7,000-8,000 tonnes under the PSF  —sold onions through Mother Dairy’s Safal outlets as well as 100 booths of Delhi Milk Scheme (DMS).The cooperative Nafed had also supplied 2,500 tonnes to the Delhi government, and later re-invited tenders for import of 10,000 tonnes of onions.

The agriculture ministry  had approved the setting up of a PSF with a corpus of Rs 500 crore, to be used to support market interventions for managing prices of perishable agri-horticultural commodities. Modal onion prices at Lasalgaon on Wednesday touched Rs 700 per quintal and average prices have remained similar since last week with arrivals crossing 14,000 quintals on a daily basis.

Patil said that since it is the start of summer, the rising heat was forcing farmers to harvest their crop faster. The onion skin begins to come off and since it cannot be stored over a month, prices of the late kharif onion are likely to drop further by Rs 200-300 per quintal, he said. Rabi arrivals will begin in larger quantities from March onwards and feed markets till September-October since it can be stored.

According to National Horticultural Research and Development Foundation (NHRDF) reports, total onion storage in the country is around 40 lakh tonnes which includes storage of farmers, traders and some private institutions.

Nanasaheb Patil however believes this time it may be adequate and more storage will be needed since the area under rabi has increased. The NHRDF report to the Centre states that acreage under rabi crops has gone up by 15-20%,” he said. As per the NHRDF’s estimate, the total production of rabi onion is going to increase by 5-7% i.e. 205-208 lakh tonnes from an area of 12-13 lakh hectares subject to weather conditions.

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