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It’s already a bit late in the season, but three out of Nandu Awati’s seven-acres holding are yet to see any rabi onion plantings. The 42-year-old from Ambegaon, a village in Yeola taluka of Maharashtra’s Nashik district, had sown onion seeds in his nursery by mid-October and begun transplanting the germinated seedlings from these towards the month-end. By November first week, he had finished transplanting in four acres, when disaster struck in the form of demonetisation of Rs 500 and Rs 1,000 currency notes. That was on November 8.
“I had to abruptly stop, as there was no cash to pay labourers and they weren’t ready to take the old notes lying with me. Nor are the new Rs 2,000 notes of any use, because people know you can’t buy daily essentials and get proper change with these,” observes Awati. He, like many other onion growers, was looking at a bumper crop on the back of good monsoon rains this time. “Last two years, we suffered from drought. The year, we have enough water, but this cash crunch has upset all our calculations,” he points out.
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Onion cultivation is a highly cash- and labour-intensive affair. Transplanting of rabi season onion — which has to be done within a month of sowing — starts from October-end and continues for the next two months. In some pockets, transplantation extends to even mid-January, though anything beyond December tends to severely impact yields. Around 60 per cent of transplantation happens between November 15 and December 15, and this is when labour demand is really high. On an average, about 40 farm hands are required to undertake transplantation operations over an acre in a single day. “It costs about Rs 7,000 per acre, and may go up to Rs 8,000 if the labourers are not locally sourced. Harvesting labour also costs the same amount. Out of our total cultivation cost of Rs 40,000 per acre, Rs 14,000-15,000 is for labour, with expenses on fertilisers, pesticides and other inputs making up the rest,” informs Awati. According to Santosh Gorade, a farmer from Takali Vinchur in Nashik’s Niphad taluka, growing onions require twice as much labour as maize, moong (green gram) or wheat. Gorade managed to complete transplantation in two of his four acres land, when the sudden cash crunch forced him to suspend operations. “The labourers in my field included 16 who were from various villages in Ratnagiri district. I had to tell all of them to leave, after they were half-way through their job. They were obviously not going to accept the withdrawn notes,” he notes.
Maharashtra produces roughly 30 per cent of India’s annual onion output of 185-195 lakh tonnes. Almost 60 per cent of it is from the rabi crop, which, depending upon the time of transplanting, gets harvested from end-February to mid-May. Rabi onions, especially from Maharashtra, are amenable to storage unlike the kharif (October-November harvesting) and late-kharif (December-January) crops. The stored rabi crop is what feeds the market during the April-September period, till the kharif onions are ready for harvesting.
For farmers in Maharashtra’s onion belt – mainly Nashik, Ahmednagar, Pune and Dhule districts — the acute shortage of Rs 100 and Rs 500 notes to pay labour has affected transplanting operations. Data from the state agriculture department as on November 25 shows only 1.46 lakh hectares (lh) being planted to rabi onions. Last year, at this time, 2 lh had already been covered and overall acreage touched 2.5 lh, despite widespread drought conditions. The current year’s shortfall appears to be largely due to the inability to pay farm labour. Apart from local labour, the onion belt also engages farms hands from the Konkan region. They mostly comprise smallholder farmers, who, after harvesting paddy from their own fields in October, come to Nashik for transplanting of onion.
Farmers like Awati and Gorade were keen to plant onions this rabi also because prices have recovered from their lows. The modal price of onion — the rate at which majority of trades happen — at Nashik’s Lasalgaon wholesale market has risen from Rs 417 per quintal in September to Rs 587 in October and Rs 872 in November. Demonetisation has seemingly not just wrecked farmers’ plans, but also raised the possibility of prices climbing on account of lower rabi plantings. Deepak Chavan, director of Farm Features Private Limited, a Pune-based commodity research firm, believes that there will be significant price correction after March. Low mandi prices till a couple of months ago had already prompted farmers to switch to maize, wheat and chana (chickpea). The cash crunch post-demonetisation will only exacerbate the trend, he adds.
While Chavan sees up to a quarter of the rabi onion area this time being diverted to less labour-intensive crops, Nanasaheb Patil, director of Lasalgaon’s agriculture produce market committee, thinks otherwise. His take is that the onion belt farmers have no real competing alternative cash crop. “Yes, absence of ready cash to pay labour is an issue, but farmers will find a way out of this, including by involving family members and neighbours in transplanting and harvesting operations,” claims Patil. But he, too, admits that the total rabi onion area in Maharashtra will barely match the 2015 level — which itself was below the average of 3 lh — notwithstanding the abundant water availability.
If Gorade and Awati are bemoaning the sudden stop to their rabi onion transplantation operations, the situation is worse for Rambhau Gangurde, a farmer from Dighwad village of Nashik’s Chandwad taluka. He is stuck with five acres of his late-kharif onions still to be harvested. “In the normal course, I would have harvested it from the coming week, allowing me to also grow rabi onions in three acres. But with the cash crunch, both harvesting of my existing crop and transplantation of rabi onions look a tall order,” he complains.
But the worst hit are farm labourers, who, without any forewarning, have seen all work opportunities drying up. Sharad Borade and his two brothers eke out a living working for daily wages at others’ fields. Residents of Takali Vinchur, the same village to which Gorade belongs, they have now decided to travel 63 km to Malegaon, a city in Nashik district. “Farmers here have no cash to pay us. So, we have no option but to look for work away from home”, says Borade, who isn’t sure, though, whether things are any better in Malegaon. “This withdrawal of notes, we are told, is good for us in the long run. I, too, hope the present hardships are temporary,” he sums up the situation.