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To check spiralling prices of onions and ease supplies, the Centre has decided to import 2,000 tonnes of onions through the State-owned MMTC while two other agencies, Nafed and SFAC, will source 12,000 tonnes locally, Food and Consumer Affairs Minister Ram Vilas Paswan has said.
A floor price of $700 per tonne on export of onions has also been recommended to the Commerce Ministry to curb despatches, Paswan said, adding that his Ministry had sent a written communication on the matter.
“We have asked Nafed (National Agricultural Cooperative Marketing Federation of India) to procure 10,000 tonnes and SFAC (Small Farmers Agriculture-business Consortium) about 2,000 tonnes directly from farmers and sell in consuming areas. We have also asked MMTC to import 2,000 tonnes,” Paswan told reporters on Tuesday.
Lower outputThe decision to import is based on expectations of a dip in onion production in the kharif season owing to lower acreage. Private traders have already imported 11,400 tonnes in the past few months. Retail prices of onions have risen to ₹50-65 a kg due to supply crunch.
In fact, the prices have more than doubled over the past six-seven weeks across major markets such as Lasalgaon (Maharashtra) and Bengaluru amidst a declining trend in arrivals. “Supplies are going to be tight as the kharif crop was impacted by the extended monsoon,” a trader said.
Dip in inflowAt Lasalgaon, the largest wholesale market for onions in Asia, trader Nitin Jain said arrivals have slowed in the last one month as yields have declined. Also, the existing inventory is getting depeleted rapidly, creating a supply-demand gap.
Jain said the onion crop in South India has also suffered due to climatic vagaries, which has led to an additional demand in Lasalgaon.
Earlier, the arrivals were about 1-1.5 lakh gunny bags (of 45-50 kg), but today the supply has dipped to 30,000-40,000 bags. Due to short supply over the past one month, the prices have risen by ₹200/300 per quintal. This shortage will last another 18-20 days as the erratic rainfall has delayed the harvest.
The new crop will start arriving in Maharashtra, Gujarat, and Rajasthan over the next two-three weeks, Jain said.
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