Retail onion prices in Maharashtra have doubled even as the area under cultivation and productivity of onions in the state has shot up.
Officials at the National Horticulture Research and Development Foundation (NHRDF) attributed the rise in onion prices in the market to speculation and said a panic situation was being created to make profit at the cost of the consumer and farmer.
Wholesale prices in Lasalgaon market have gone up to R16-17 per kg as compared to R12-14 in other markets and even up to R2,300 per quintal in the last two days.
Traders hold the drought conditions responsible for the hike in prices while officials say the middlemen between the farmers and consumers are making profit. Retail prices are hovering around R30 per kg in several markets.
?Production in Maharashtra has not been significantly affected because the climatic conditions are favourable. Although acreage under the rabi crop has gone down by 10-15% across the state, productivity has gone up and therefore production is likely to remain the same as last year,? RP Gupta, director of NHRDF, said.
Last year, total production was around 174 lakh MT and it will remain the same this year, he asserted. Moreover, international prices of onions are not very high because of which exports have come down and prices in the domestic markets are higher, he said.
?Prices in some areas are three times higher, ranging from R20 to R30 per kg depending on the area and quality of onions. There seems to be no logical reason for this,? Gupta said. ?Total arrivals of onion during January (till the third week) in 22 major markets were less by around 3% but prices were increased by 166% compared to last year. The arrivals during January 2013 were also more in Lasalgaon, Dhavangiri and Kolkata markets.”
?There is no shortage of production or arrival of onions in any market in the country. Yet, the prices are highest at the Lasalgaon market,? he added.
Jayadutta Holkar, chairman of the Lasalgaon Agriculture Produce Market Committee (APMC) in Nashik, among the biggest onion producing centres in the state, agreed with this view and said the chain of agents in between was adding to the cost of transportation in addition to other taxes, as a result of which onion prices were almost double.
?There has been a delay in the rabi crop arrivals and there was a series of holidays last month, as a result of which markets were closed and arrivals were stopped. This delay in arrivals led to the speculation that there is less onion in the market,? Holkar pointed out.
Dilip Bankar, chairman of the Pimpalgaon APMC, however, maintained that the drought conditions in the state had impacted production up to 40% and there was three lakh quintals of less arrivals as compared to the same time last year.
?Rabi onions have not arrived yet. Their first arrival is usually by January 15 and the second is by February 28. This has led to a panic situation in the market that there is less crop and so prices are shooting up,? Bankar said.
There is an increase demand for onions from other states, including Madhya Pradesh, Uttar Pradesh, Bihar, Bengal, as well as from Dubai, he added.
Maharashtra, Gujarat, Karnataka and Andhra Pradesh are the main onion-producing states, with Maharashtra alone accounting for 70% of the total production in the country.
