Table of Contents
ONIONS IN INDIA
- India is the 2nd largest onion growing country in the world.
- Indian onions are famous for their pungency and are available round the year.
- Indian onions has two crop cycles, first harvesting starts in November to January and the second harvesting from January to May.
- The Major Onion producing states area Maharashtra, Karnataka, Madhya Pradesh, Gujarat.
- Maharashtra ranks first in Onion production with a share of 28.32%.
- It is important not only for internal consumption but also as highest foreign exchange earner among the fruits and vegetables.
- Major Export Destinations (2018-19) : Bangladesh, Malaysia, UAE, Sri Lanka and Nepal.
WHY IS THE PRICE OF ONION ON THE RISE?
- It is a result of last year’s drought and a delayed monsoon this year.
- The situation is compounded by excessive rainfall in onion-growing areas, which has delayed the harvest period by a week or so.
- The excess monsoon in key producer states like Karnataka, Maharashtra, Madhya Pradesh, Gujarat, Rajasthan, Uttar Pradesh, and Bihar, has led to such a steep hike.
SPIKE DURING THIS TIME OF THE YEAR
- Trade analysts suggest onion prices see a spike during this time of the year because of floods and illegal hoarding of onion ahead of the festive season.
WHY THERE IS LESSER SUPPLY DURING THIS TIME?
- It is related to the harvest cycle of onions in the country.
- A majority of the onion crop—about 80%—is grown in the winter or rabi season and sown during the two months of December and January.
- This crop is ready for harvest during April-May.
- A chunk of it is also exported.
- The summer or kharif onion crop is sown during May-June and is reaped during October-November
- . It is when this harvest reaches markets—in about a month’s time—that prices will adequately cool.
MEASURES BY GOVERNMENT
- The government usually tries to check a rise in prices by imposing a temporary minimum export price on onion, as it did on September 13.
- The minimum export price – set currently at US$ 850 a tonne (about Rs 60,300 a tonne)
- At the same time, the government also resorts to imports.
- But both these measures take time.
- The government also tries to augment supplies by releasing onions from federally held stocks (of around 50000-55000 tonne).
- This is the only realistic option of showing quick results in stabilising prices.
- Assuring that the government is taking steps to balance the interest of both farmers and consumers
- The agriculture minister said, The Nafed, which has enough stock of onions, is now releasing stock from the central buffer at a lower price.
- The centre has a buffer stock of 56,000 tonnes of onion, Of which 16,000 tonnes has been offloaded so far. In Delhi, 200 tonnes a day is being offloaded.
- National Cooperative Consumers’ Federation of India have been selling onion from the buffer stock at Rs 22-23/kg.
- While Mother Dairy’s Safal stores are selling at Rs 23.90 per kg in the National Capital.
LONG TERM SOLUTIONS
- The government needs better policy responses–
- Such as creating more refrigerated storage facilities so that surplus onions can be stored longer.
- Increase the rate of processing of onions, so that consumers can quickly substitute onions for onion paste and dehydrated varieties in times of crunch.
- Imports don’t work to cool prices promptly unless they have been signed up much in advance.
- Policymakers therefore need to put together a comprehensive picture of supply-side situations, By connecting production data and weather forecasts much in advance.
OPERATION GREENS
- It was announced in the budget speech of 2018-19.
- The Ministry of Food Processing Industries has launched the scheme.
- It seeks to stabilize the supply of Tomato, Onion and Potato (TOP) crops and to ensure availability of TOP crops throughout the country round the year without price volatility.
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