BUSINESS

Rising prices: Onion farmers get greedy

Source:PTI
December 27, 2010

Looking to profit from the boom in onion prices across the country, some farmers in Bhavnagar district of Gujarat, the third largest producer of the vegetable in the country, are uprooting the crop from their fields almost a month before they are ready for harvest.

"Some onion farmers in Bhavnagar district of Gujarat, in their lust to cash on the rising prices of the root vegetable, are uprooting the crop almost a month in advance, which is ruining quality of the produce," Azadpur-based Onion Merchants Association General Secretary Rajendra Sharma told PTI.

Onions are normally harvested in the region after January 15, but some farmers have already started pulling the crop from their fields to earn big money in view of skyrocketing rates of the commodity across the country, he added.

Sources in the Agriculture Produce Marketing Committee (APMC), Bhavnagar, confirmed that some farmers had arrived in the market yard with their premature onion harvest, but the officials rejected their produce.

"We are meticulously checking the quality of onions before buying them from farmers," APMC Bhavnagar Chairman Jitendra Singh Chudasama said. At their peak on December 20, a 20-kg sack of onion sold for around Rs 1,230 at the APMC Bhavnagar, but the price has now come down to around Rs 800-850 for the same quantity, the sources said.

Unseasonal rains this year had delayed sowing of onions by a month till November, the APMC Bhavnagar sources added. Despite being a bulk producing region, Bhavnagar has not been spared from the sky-high rates of onions seen across the rest of the country.

Prices of onions had peaked at Rs 60-65 in Bhavnagar's retail market on December 20, when rates for the commodity had skyrocketed to Rs 70-85 per kg in the retail markets of some metros. However, the retail price of onions in Bhavnagar has now fallen to about Rs 40/kg.

Sharma said that Delhi's Azadpur market -- which is Asia's biggest wholesale fruit and vegetables market -- usually receives around 800-850 tonnes of onions from Bhavnagar every year. However, this year, just 50 tonnes of onions were received.

Gujarat is the third largest producer of onions in the country after Maharashtra, with annual production of over 9 lakh tonnes.

Around 90-95 per cent of Gujarat's onion output is from the Bhavnagar, Surendranagar, Junagadh, Rajkot and Jamnagar districts. Bhavnagar district alone contributes 35-40 per cent of the onions produced in the western state.

Sources in Nafed, Kendriya Bhandar and Mother Dairy said they are not getting any subsidy for selling onion at lower rates to tide over the situation arising due to soaring of the politically sensitive commodity at Rs 70-85 last week.

"We are incurring our own expenditure in purchasing onion from open market and making it available at our outlets at cheaper rates," sources in the three agencies said. Tomato sold at Rs 40-50/kg in the national capital in retail markets today, the same as it was for more than a week.

Tomatoes were sold at Rs 40/kg today in Kolkata, traders said. It cost Rs 60 for a kg in the financial capital Mumbai and Rs 44-50/kg in Chennai. Rates of garlic, which is used both as a vegetable and to make Ayurvedic medicines, have increased sharply to Rs 300/kg at present in Delhi, compared to Rs 160-180 per kg a month back, trade sources said.

The commodity was being traded in the range of Rs 250-280 a kg earlier this week. However, the price has gone up to Rs 300 a kg since Friday. Meanwhile, sale of garlic illegally managed from China via Nepal by some traders continued in the Azadpur market as in the past.

Sources in the Azadpur market claimed that in order to cash in on the exorbitant prices of garlic (at Rs 300 a kg in retail and Rs 120-180/kg in the wholesale market), some traders were illegally bringing garlic from China into the country via Nepal. India had banned import of garlic from China two years ago following the detection of fungus in consignments of Chinese garlic.

From the Himalayan states, it is being transported to Delhi, Chennai, Mumbai and Coimbatore through trains from Bihar, which shares a border with Nepal, they claimed. The price rise of all three crops has been attributed to unseasonal rains in the major producing regions.

However, in the case of onions, a politically sensitive item, the government has also blamed hoarding and speculation. Meanwhile, Lucknow and Kanpur district administrations in Uttar Pradesh have decided to provide onion at lower rates to provide relief to common man.

Lucknow district administration has announced that it will sell onion at Rs 22-24 a kg through 25 outlets. Likewise, Kanpur administration started selling onion in more than 50 outlets at the rate of Rs 22 from today. District Magistrate Mukesh Meshram said people will be given two kgs of onion on each ration card.

Source: PTI
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