Farmers in Madhya Pradesh who planted more onions following unusually high prices in August-October 2015 are now ruing their decision. A glut of onion has seen prices crashing across mandis in Malwa-Nimar region.
While wholesale prices have crashed to 30 paise per kg in Neemuch, in Indore mandis farmers are getting Rs 3- Rs 4 per kg, traders said.
In Khandwa, Ujjain, Dewas and other locations, onions are selling between Rs 2 and Rs 4 per kg at the wholesale markets. A fortnight back, farmers were getting Rs 5-Rs 8 per kg in the mandis.
“The fresh crop that has arrived is laden with moisture and so it cannot be stored for a long period that is the main reason that farmers are bringing crop in bulk and there is glut,” wholesale trader Murlidhar Patidar told Hindustan Times.
Shakil Tigala, another trader, said that at this time of the year onion from Madhya Pradesh is sent to Punjab, Delhi, Uttar Pradesh and other states, but this year the prices are too low to cover the transport cost. “As a result, there is a glut and many traders have stopped purchasing onions from farmers,” he said.
Surplus onion is bad news for farmers, most of whom have been abandoning sacks of the bulb at the market after failing to find buyers. Onions were selling at Rs 70 per kg in August 2015 and came down to Rs 30 per kg in October last year after the government started importing the bulb from Egypt and Afganisthan to boost supply.
Farmer leader and Neemuch mandi director Rajendra Singh Tomar said that the government should fix a minimum selling price (MSP) of onions to prevent price rigging.
Nihal Singh, a farmer from Dewas, said he expected to get around Rs 20-Rs 25 per kg when he planted the crop but the price was now not enough for him to recover his input and transport costs. In 2015, the state government started a scheme to incentivize cultivation of onion to address the shortage and the price hike during monsoon and post monsoon period. Many farmers who took benefit of the scheme are now in tears.
Across the country, onion cultivation is spread over four seasons—early kharif, kharif, and late kharif and rabi crops. Last year, a deficient monsoon and delay in crop arrivals lead to onion prices touching Rs 80 a kg in retail markets.
Madhya Pradesh is the second largest producer of onions after Maharashtra. In Madhya Pradesh, onion is primarily grown in the Malwa, Nimar Sagar and Damoh regions. The area under cultivation is 111,000 hectare while the yield is 24 tonne a hectare.
(With input from Mustafa Hussain in Neemuch, Sandeep Vatsa in Ujjain and Sunil Kerhalkar in Khandwa and Nitin Gupta from Dewas)