The woes of Maharashtra’s onion sector do not seem to end. Almost all the 14 agriculture produce market committees (APMCs) in Nashik, including Lasalgaon — the country’s largest wholesale market for the bulb—, Pimpalgaon, Yeola and Chandwad have been shut since Thursday after the income tax department carried out searches in the godowns and homes of seven onion traders of the area.
Onion prices, which were trending at Rs 1,400 per quintal, suddenly crashed to Rs 900 per quintal, leading to a stop in auctions at Lasalgaon on Thursday.
Lasalgaon APMC chairman Jaydutta Holkar said that the searches were being carried by the I-T department to cross-check the sales records and stock positions in addition to the income of these traders.
As many as 25 premises of seven major onion traders in Lasalgaon and surrounding areas in Nashik district were raided by the income tax officials. Two of the traders are from Lasalgaon and one each from Pimpalgaon, Yeola, Umrane and Chandwad APMCs. These traders have the capacity to purchase 30% of the total arrivals in the market. The searches are still in progress and therefore the markets are shut as a precautionary measure. On Wednesday, arrivals were to the tune of 8000 quintal at an average price of Rs 1400 per quintal.
The government is closely monitoring the onion prices and availability in Maharashtra.
Earlier, the PMO (Prime Minister’s Office) had sought a detailed report from the Nashik district administration and the agriculture produce market committees (APMCs) on the onion stock position, remunerations received by farmers and stocks being held by traders.
According to Holkar, the market was shut down in Lasalgaon after prices suddenly dropped and farmers refused to sell their produce. The situation was similar in other markets as well with I-T department vehicles parked outside the offices and godowns of traders.
Holkar said that the average wholesale onion prices in the domestic markets had increased five times from Rs 450 per quintal on May 31 to Rs 2,450 per quintal on August 10, registering a 20-month high, due to short supply in the city’s retail markets.
Retail prices had increased from Rs 10 to Rs 30 per kg after rise in wholesale onion prices in past two-three months. In various cities, retail prices had touched Rs 40-50 per kg. But the wholesale onion prices started declining after a delegation led by top officials of the Union ministry of consumer affairs, food and public distribution visited Lasalgaon in August to ascertain the reasons behind the dramatic escalation in the onion prices at the start of the month and sharp fall thereafter.
Last week, the Union ministry of agriculture had sought details pertaining to arrivals and wholesale prices from the Nashik district administration. The latter had sent details regarding arrival and their prices over three months at APMC.
Manoj Jain, an onion trader from Lasalgaon, said that conducting searches at a time when prices were dropping had no logic. Friday is the first day for traders to pay up advance tax and therefore these searches are of concern to all, he said. Such steps will impact the market badly leading to an atmosphere of fear. Some traders said that farmers will be more concerned now, if they should continue cultivation of onions.