Faced with the possibility of onion prices rising further, the Ministry of Agriculture has convened meetings of various stakeholders tomorrow.
In two weeks, onion prices have risen 25 per cent to trade between Rs 1,600 and Rs 1,700 a quintal at the benchmark Lasalgaon market (Nashik). Prices for retail consumers in Mumbai stood at Rs 23-24 a kg. In New Delhi, retail prices are higher, owing to high transportation costs.
According to a study by the Small Farmers Agriculture Business Consortium, between January 5 and 10, the average price in Lasalgaon was Rs 1,245 a quintal, a rise of 246 per cent compared with Rs 360 a quintal in the corresponding period last year. During the same period, the average price of onion in Pimpalgaon rose 229 per cent to Rs 1,265 a quintal, against Rs 385 a quintal in the year-ago period.
| ON THE RISE Average onion price between January 5-10 (Rs/qtl) | |||
| Market | 2012 | 2013 | Change (%) |
| Delhi | 550 | 1110 | 101.82 |
| Bangalore | 750 | 1300 | 73.33 |
| Lasalgaon | 360 | 1245 | 245.83 |
| Pimpalgaon | 385 | 1265 | 228.57 |
| Mumbai | 500 | 1296 | 159.20 |
| Hyderabad | 600 | 1475 | 145.83 |
| Jaipur | 555 | 1050 | 89.19 |
| Indore | 400 | 900 | 125.00 |
| Chennai | 800 | 1717 | 114.63 |
| Source : National Horticulture Board | |||
“There are two meetings lined up with the ministry of agriculture tomorrow. The first would assess the crop situation in the season’s first advanced estimates — the area under onion and other vegetable crops. The second would discuss the situation in the onion market, including the supply situation and prices. It would also discuss measures to keep onion prices under check,” said R P Gupta, director, National Horticulture Research & Development Foundation, Nashik.
As this year’s supply has been the same as last year’s, the abnormal increase in onion prices raises questions on the role of arhatiyas (commission agents).
While Gupta rejected the possibility of a decline in production this year, the National Council of Applied Economic Research has estimated a 20 per cent fall in onion output for 2012-13, amid expectations of robust demand from domestic, as well as foreign markets. Traders estimate a production decline of 35 per cent and 25 per cent in Maharashtra and Karnataka, respectively.
The National Horticulture Board (NHB) estimates overall onion production in 2011-12 stood at 16.34 million tonnes (mt).
“The agriculture ministry has convened the meeting to assess the situation on the ground. There is no possibility of a ban on exports, as apprehended by traders,” said Virendra Singh, chairman, National Cooperative Consumers’ Federation of India, under the Ministry of Consumer Affairs, Food & Distribution.
An assessment by NHB showed export demand this year was robust. Bangladesh faces a shortage of onions, as the crop produced in that country was already consumed, and a new harvest had just started. Demand in Bangladesh stands at 1.8-2 mt, while production is about 1.5 mt. Earlier, it was expected Pakistan would export 2,00,000-2,50,000 tonnes of onion this season. But deteriorating crop quality hampered exports; as a result, many orders came India’s way.
Ashok Valunj, director of Agricultural Produce Marketing Committee (Vashi), said the quality of the new crop this season was poor, with a shelf life of 10-15 days (good-quality crop can be stored for about a year).
Sanjay Sanap, owner of Shivkrupad Traders, a Nashik-based onion trader, hopes with new crop arrivals from Gujarat and Rajasthan, the situation would normalise in a month.
