Onion Price: The Great Indian Tearjerker

Comments 0
On an average, small and medium-scale farmers invest Rs 30,000 -40,000 on each acre of land to yield around 150 quintals of onion. On an average, small and medium-scale farmers invest Rs 30,000 -40,000 on each acre of land to yield around 150 quintals of onion.
SummaryThe price of the onion swings wildly in its journey from Maharashtra’s fields to wholesale markets in other Indian cities

5,000 per quintal at the Nagpur market. None of the other farmers got prices more than Rs 3,000-4,000 per quinital the same day. This was a clear case of internal fixing,” he says. Just days after the abnormal hike fueled speculation over the paucity of crops in storage, the prices of onions slumped to

Rs 3,000-Rs 2,500 at Chandwad.

Price of onions continue to be volatile in India because of the stranglehold of middlemen on the system. For instance, the price a farmer gets in hand is not inclusive of the commission taken by traders, which ranges between 6-10 per cent. This is ostensibly for handling and storage charges. “Often the traders do not pick up the produce for a few days. When they come for the crop, they again reduce the price as they claim the weight has gone down,” says Dadaji Shevale, another farmer in Chandwad.

Being a perishable commodity, the trading community counters, loss in transit is unavoidable. Other than packing, transportation, commission for the agents of the APM, there are other costs which the crop has to encounter before it goes out to the market. “With diesel prices skyrocketing, we have to shell out Rs 500 for transportation of the crop from the APMs to the wholesale markets. We also have to pay 6-7 per cent to the commission agents at the wholesale markets. On an average, if we buy onions at Rs 3,500 per quintal, by the time it reaches the wholesale markets, the price of the produce, including our cuts, increases to Rs 5,000 per quintal. These days, without any steady supply and increase in demand, the prices are touching Rs 6,000-7,000 per quintal,” says a trader in Chandwad.

This year, the traders say, the price hike is due to the reduction in production as major parts of the onion growing region of Maharashtra were hit by drought. However, Holkar and other farmers deny this. “There was a marginal decline in production, but it can’t substantiate the stupendous price rise,” he says. Over the last two weeks, supply has picked up steadily, bringing about

Single Page Format
Ads by Google

More from Commodities

Reader´s Comments
| Post a Comment
Please Wait while comments are loading...