May 26, 2024

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Passion For Business

Onion prices crash 30-40% in 10 days

Onion rates throughout the region, particularly in principal agricultural markets in close proximity to the increasing regions, have crashed concerning 30 for every cent and 40 for every cent around the very last ten days as the late kharif crop has begun to flood the markets.

Officials, traders and exporters dread more slide in the bulb’s rates as the rabi crop is all set to strike the markets whenever after March fifteen.

“Onion rates experienced topped ₹ four,000 a quintal in Nashik in the third 7 days of February, but they have now dropped to levels of ₹2,five hundred as late Kharif crop arrivals have elevated due to the fact the very last four-5 days,” mentioned Suvarna Jagtap, Lasalgaon Agricultural Develop Advertising Committee (APMC) Chairperson. Lasalgaon is a person of the most important markets for onion in Maharashtra’s Nashik district, the hub of the commodity’s trade.

In accordance to the Ministry of Agriculture and Farmers Welfare, the modal cost or the price at which most trades took area on Tuesday was ₹2,660 a quintal for the Pink variety as opposed with ₹4,000 on February 20.

Unseasonal rains influence

Following dropping from the highs seen for the duration of September-October very last calendar year, onion rates surged very last month after unseasonal rains lashed the increasing components of Maharashtra, increasing fears around the crop potential customers.

Price ranges in other increasing States these as Gujarat and Maharashtra also elevated in tandem due to the fact the latter is the best producer in the region. Maharashtra accounted for practically 41 for every cent of onion developed for the duration of 2019-20.

Modal rates in other States these as Madhya Pradesh, the second-largest grower, and Gujarat, the fifth-largest producer, dropped in line with the Maharashtra trend. In Madhya Pradesh, the modal cost dropped to ₹ 2,000 a quintal from ₹ 3,000 on February twenty five.

In Gujarat, the modal rates dropped to ₹ 2,400 on Tuesday from ₹ 3,000 for the duration of February 22-twenty five at Kapadvanj APMC in Kheda district.

Price ranges for the duration of the similar time very last calendar year dominated beneath ₹ one,five hundred a quintal at Lasalgaon.

“The late Kharif onion has begun arriving after some hold off,” mentioned PK Gupta, Performing Director at Nashik-based mostly Nationwide Horticultural Investigation and Progress Basis (NHRDF).

 

Arrivals raise

Arrivals in Maharashtra elevated for the duration of February twenty five-March 2 by 27 for every cent to 88,643 tonnes as opposed with sixty nine,625 tonnes for the duration of February eighteen-23. At the similar time, arrivals in Gujarat dropped to fifty eight,347.fifty five tonnes from seventy six,824 tonnes for the duration of the similar time period, even though in Madhya Pradesh it was a tad higher at six,819.twenty five tonnes vs . six,761.07 tonnes.

Throughout February twenty five-March 2 very last calendar year, arrivals in Maharashtra were being much higher at one.seventy three lakh tonnes, Ministry of Agriculture details showed.

“Prices have crashed as arrivals are flooding the market place not only in Maharashtra but also in other increasing States these as Gujarat,” mentioned Jagtap.

No increase to exports

Nevertheless, the fall in rates are not helping in boosting exports. “We are bit by bit finding orders but they are not at prior levels,” mentioned Chennai-based mostly Rajathi Group Director Madan Prakash.

“Pakistan is incredibly competitive in the export market place featuring onion at $400 a tonne. Right now, our cost is $550 a tonne as opposed with $seven-hundred a several weeks ago,” mentioned Prakash, whose firm exports onion to South-East Asia.

The trouble with onion exports is that India has not been ready to recover after the ban imposed on shipments in September very last calendar year to curb the sharp rise in rates. Moreover banning exports, the Centre also authorized responsibility-free of charge imports of onion as retail rates topped ₹ a hundred a kg then.

The actions served control the rise in rates by October-end and the ban on exports was lifted from the New Yr.

Nevertheless, first, importing international locations experienced shares of onion from other resources these as Egypt, Turkey and Holland and then, the Indian develop could not match the rates at which Pakistan and China provided to global prospective buyers.

Curiously, prior to the Centre can ban onion exports, its shipments for the duration of April one till September-end at 13.07 lakh tonnes experienced exceeded very last fiscal whole exports of 11.49 lakh tonnes.

Increased output in 2019-20

The exports occurred on the heels of the Ministry of Agriculture, in its third progress estimate of horticultural crops, pegging onion output higher for the duration of the 2019-20 year (July-June) at 26.forty eight million tonnes from 22.eighty two million tonnes the prior calendar year.

“We are finding packaged cargo at Mumbai for exports at about Rs 30,000 a tonne,” mentioned Prakash.

This translated to $411 a tonne but shippers are possessing to pay a top quality to transport companies for rapid shipments or shell out on storage until eventually actual shipments get area.

“Arrivals have elevated, and rates could be under strain going ahead,” Prakash mentioned.

Tiny reduction seen

“We really don’t see growers finding reduction from minimal rates as the Rabi crop will begin arriving in two weeks’ time,” mentioned Jagtap.

“Prices could fall to as minimal as ₹ one,five hundred around the up coming several weeks as arrivals are rising,” mentioned Sohanlal Bhandari, Nashik District Onion Traders Chairman.

Concurring with the traders’ sights, NHRDF’s Gupta mentioned the Rabi onion was envisioned to arrive as early as March fifteen. “The arrivals might be higher as this calendar year the spot under cultivation elevated. But the produce for every hectare might be minimal,” he mentioned.

Quality seeds challenge

Growers did not sow high-quality onion seeds, which could influence productiveness, the NHRDF formal mentioned.

Availability of high-quality seeds has been an challenge due to the fact growers have been advertising their develop when rates are higher than preserving a portion of it for resowing.

“The sharp fall in rates is now forcing farmers to keep again. This has resulted in arrivals slowing,” mentioned Nashik-based mostly trader Jayachandra Muthalya.

In accordance to Ministry of Agriculture details, provisional arrivals in Maharashtra on March 2 were being twelve,097 tonnes as opposed with eighteen,052 tonnes on March one. For a significant portion of very last 7 days, arrivals were being higher than fifteen,000 tonnes in the State.

“Prices have dropped more by ₹ a hundred now,” mentioned Rajathi Group’s Prakash, pointing to the strain on the market place.

Jagtap mentioned farmers are unable to be keeping the late Kharif onion for extensive due to the fact they did not have a longer shelf everyday living like Rabi onion. “They will have to make certain that the develop is bought off immediately,” she mentioned.

At a person point of time very last 7 days, rates dropped beneath ₹2,five hundred a quintal prior to climbing again this 7 days.