Trading comes to halt at Lasalgaon on dispute over wages

With prices of potato and onion soaring across markets in the country, market insiders are blaming speculators for the surge.

“Even though there was some damage due to pre-monsoon showers during February-April this year, there is no shortage of onion in the market. It is more of a psychological factor that has caused a buzz about price rise,” RP Gupta, director, National Horticultural Research and Development Foundation (NHRDF) told BusinessLine.

In the past fortnight, prices of these two vegetables have jumped by up by 55 per cent in different markets of the country. At Lasalgaon, Asia’s largest onion market, the modal price or rate at which most trade took place ruled at ₹1,250 a quintal on Monday, up 22 per cent from ₹1,025 on June 2.

Labour issues

No trading has taken place in Lasalgaon from Monday in view of a controversy over labours who weigh the onions seeking a higher wage.

“The strike will not hamper supplies as we have other centres such as Aurangabad, Solapur and Pune from where supplies can be got,” said Gupta.

(Cogencis reported that onion auctions in the 14 market yards of Nashik will resume from Wednesday after agitating traders and labourers reached a deal with the State Government.)

A sharper hike was witnessed in Ahmedabad APMC (Agricultural Produce Marketing Committee) yard, where onion touched ₹1,400 on Monday, up 55 per cent since June 2.

Potato prices, too, have increased by 16 and 18 per cent respectively in Delhi and Mumbai markets to ₹1,720 a quintal and ₹1,850 during the fortnight.

Concerns over crop damage and flash strike by workers at Nashik are hampering onion supplies, adding fuel to the price rise. Onion production in 2013-14 season ending this month is 19.2 million tonnes, up 14 per cent from last season’s 16.8 million tonnes.

Estimates show that about 3-3.5 million tonnes of onions are held up either with farmers or traders in anticipation of higher prices like last year.

A year-on-year comparison of NHRDF data showed an increase in arrivals in June compared with the same month last year. At Lasalgaon, arrivals were 1,550 tonnes on Monday against 1,290 tonnes a year ago. In the Ahmedabad market, arrivals stood at 974.7 tonnes against 552 tonnes on the same day a year ago.

Monsoon concerns

“There are concerns over monsoon affecting vegetable crops such as onion and potato. Once onion sowing begins for kharif, we will see prices stabilising. Potato prices may see upward trend for a few weeks more as the futures market is firm,” said a potato trader in Ahmedabad’s Chimanbhai Patel APMC.

Potato arrivals too are higher compared with last year. In Mumbai, potato arrivals increased from 1,240 tonnes on June 17 last year to 1,528 quintals on Monday. But prices have increased by over 60 per cent year-on-year from ₹1,150 to ₹1,850 a quintal.

(This article was published on June 17, 2014)
XThese are links to The Hindu Business Line suggested by Outbrain, which may or may not be relevant to the other content on this page. You can read Outbrain's privacy and cookie policy here.