For improving supplies and curbing spike in prices, the government has decided to focus on increasing the rabi production of onions, especially in the eastern and north-eastern regions.
After the national conference for formalising the rabi strategy, a senior agriculture ministry official said that the regions such Odisha, Bihar, Jharkhand and western Uttar Pradesh and north-eastern states would be asked to increase onion production so that the dependence on a few states for the supply of key agricultural commodity would end.
Out of the annual onion production of close to 19 million tonne in 2014-15, around 13 mt was produced during rabi season. Out of the total rabi output, which usually starts arriving in the market by March and April, about 7–8 mt is stored for distribution till October.
“We are formalizing a strategy to augment onion production in collaboration with the state governments in eastern and north-eastern regions so that dependence on a few states like Maharashtra, Andhra Pradesh and Karnataka for augmenting supplies must end,” the agriculture ministry official told FE.
The official also said that onion crops do not need any special weather condition and eastern and north-eastern states would be encouraged to grow onion.
Due to lose of output in rabi season this year, onion prices have been ruling in the range of R60 to R70 per kg across key cities in the last one month.
Besides, the agriculture ministry is also considering a proposal to create a buffer stock of about 1 mt of onion which would be used to augment supplies during August–October, when prices usually rise sharply. The ministry has asked states to use funds from Price Stablisation Fund to store onions which would be distributed when prices start to rise.
Meanwhile, the wholesale onion prices at Lasalgaon and Pimpalgaon, the major hubs of the country’s onion trade in Maharashtra, has dropped to R3,900 per quintal on Tuesday from the R5,000 a quintal which prevailed a month back. This is expected to bring down retail onion prices across the country during the next few days.
Agriculture ministry official said the kharif crop is expected to enter market during next two to three weeks.
In a step which virtually stopped onion exports, the government last month had hiked the minimum export price of onion to $700 per tonne from $ 425 per tonne to restrict exports and the state government has been asked to impose stock holding limits on traders.
Maharashtra, Karnataka, Rajasthan and Madhya Pradesh are the key producers of the agricultural commodity. Onion is produced in three seasons – kharif (15-20% of the total production) which is harvested in October – December, late kharif (20–25% of the total produce) which comes to market in January – March and rabi (55–60% of the produce) which is harvested in March–May.