As onion prices plunge to decade low, farmers take to sit-ins

About 20,000 farmers are estimated to have sold nearly 3 lakh quintals in the Lasalgaon market during the two months, making them eligible for payments of Rs 3 crore.

Written by Partha Sarathi Biswas | Lasalgaon | Published:September 29, 2016 1:38 am
onion price, india onion crash, onion price india, onion farmer, business news, onion export price, minimum export price, alling onion prices, onion bumper crop, farmer suicides, drought  maharashtra, india news Bhaskar Gavali at the onion storage shed next to his farm in Niphad, Nashik.(Express Photo: Partha Sarathi Biswas)

Nothing illustrates the ongoing woes of the Maharashtra farmer better than onion — the crop that brought tears to urban consumers only a year ago and has since faded from the headlines.

Popat Ushir has managed to sell only a third of the 120 quintals of onions that he harvested six months ago from 1.45 acres at Dhodambe village in Nashik’s Kalwan taluka.

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When he started selling in end-March, prices of the bulb were around Rs 600 per quintal. They rose to Rs 850-900 during April-June, which would have just about covered his inputs costs, but not the
expected returns from storing the crop harvested in March.

But then came the shocker. Prices, which should have gone up in the lean season, actually started falling. For the current month, the ‘modal’ price — the rate at which most sales have taken place — at the Lasalgaon market has averaged Rs 421 per quintal, below even the Rs 706, Rs 829 and Rs 844 levels for the preceding three months. Ushir realised a mere Rs 210 per quintal for the five quintals that he sold last in late-August. Worse, after all that, he still has 80 quintals left to sell.

Ushir has, since Tuesday morning, been on a fast unto death at the office of the Nashik district collector. He has been joined by 100 other farmers, who are doing a sit-in to draw attention to the plight of growers in this onion belt.

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Popat Ushir (second from left) sitting on a fast unto death at the Nashik collector office. (Express Photo: Partha Sarathi Biswas)

“We will continue this agitation till two of our demands — a minimum support price of Rs 1,950 per quintal for onion and a subsidy of Rs 500 per quintal to farmers against their sales till rates stabilise in the open market — are met,” said Santosh Gorade. This farmer, from Takali Vinchur in Niphad taluka, had stored 140 quintals from his 1.5 acres, more than half of which got rotten. The balance crop he sold mostly at Rs 250-300 per quintal, while realising a maximum rate of Rs 459 in July.

“This has never happened — prices in August-September being lower than in April,” pointed out Bhaskar Gavali from Bramhangaon Vinchur, a village in Niphad. Farmers like him stock the rabi season onions harvested from end-March in ‘sheds’ — basically on-farm structures constructed on raised platforms to prevent direct contact of the bulbs with the soil. Rabi onions, unlike the kharif (arrivals during October-November) and late-kharif (January-March) crops, are amenable to storage because of their lower moisture content. A dry, heat-protected and well-ventilated environment ensures no sprouting or rotting, while allowing farmers to realise better prices during the off-season before the kharif crop’s arrival.

The kharif and late-kharif crops make up roughly a fifth each of India’s total onion production, with the remaining 60 per cent coming from the rabi season.

Last year, the average modal price at Lasalgaon — a benchmark rate-setting market for the country — rising from Rs 1,093 per quintal in April to Rs 1,198 in May, Rs 1,554 in June and Rs 2,118 per quintal before scaling stratospheric heights of Rs 4,100-plus in August-September. It led to the Centre imposing a minimum export price (MEP) of

$ 700 per tonne on August 23. As a result, exports ground to a halt. By the time the MEP was removed on December 23, prices had crashed to Rs 1,000 per quintal. And with the high prices in August-September inducing farmers to plant more area, the country’s onion production rose by 11 per cent to an estimated 210 lakh tonnes in 2015-16. Prices, then, fell instead of rising in the off-season.

“The average modal price for this month (Rs 421/quintal) is the lowest for September in a decade. And with the kharif crop from the South starting to arrive, prices may go still lower,” predicted Jaydutt Holkar, chairman of the Lasalgaon Agriculture Produce Market Committee (APMC).

The brunt of it is being borne by farmers. “The present price will not cover even transport cost to the mandi. It is better from us to simply discard the crop and plough it back to the field,” stated Gavali, who had stored 180 quintals of rabi onions from 1.2 acres, hoping for a minimum price of Rs 1,200 per quintal. Instead, the maximum rate he has realised over the last six months is Rs 850.

The Centre has responded by announcing a 5 per cent export subsidy on onions, with the Maharashtra government also providing a Rs 100 per quintal grant to all farmers who sold the bulb in APMC mandis from July 1 to August 31. “This will hardly help, as the markets in Nashik operated for only 24 days during this period due to the APMC traders strike. In any case, what was the point allowing just a two-month window when it is the stored onion crop that is arriving?” asked Holkar.

About 20,000 farmers are estimated to have sold nearly 3 lakh quintals in the Lasalgaon market during the two months, making them eligible for payments of Rs 3 crore. Back in 2008, the Maharashtra government had declared a similar subsidy of Rs 50 per quintal following a glut. However, the subsidy was given for January-March and 16,288 farmers received Rs 6.75 crore for the 13.5 lakh quintals sold during the full three-month period then.

“Farmers this time deserved at least Rs 500 per quintal subsidy and these should have covered sales during June-August,” added Holkar.

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