Bumper harvest and huge arrivals from Mysore as well as from different parts of Dindigul, Tirupur and Coimbatore districts have pushed the prices of small onion to rock bottom, forecasting bleak future for onion producers in the months to come.
Within a week, Dindigul wholesale market, one of the biggest markets in the State, has witnessed a 50 percent slump in small onion prices. The situation would deteriorate further in the coming months, predict commission agents and traders.
The prices that were hovering between Rs.35 and Rs.40 in the last week of February fell to Rs.18 and Rs.20 a kg, depending on quality and size of onions.
They fear that prices may go down to Rs.10 and Rs.12, if the present arrivals continue in the coming months.
With bumper harvests in Karnataka, farmers throng the Dindigul market with several truck loads of small onions.
At the same time, onions produced in Vellode, Sengurichi, Senthurai, Chinnalapatti, Eriyode, Vedasandur, Oddanchatram, Vadamadurai, Iyyalur and Gujiliamparai in the district are too hitting the market from March 1, thanks to commencement of harvesting. Now, arrivals from Karnataka are around 4,000 to 5,000 bags (each bag contains 80 kg) that were 1,500 to 2,000 bags a day last month, says V. Rajendran, leading onion trader in Dindigul market.
Export to Sri Lanka from Dindigul is almost nil. Poor off-take by Singapore, Malaysia and Thailand, major importers of Indian onions from Dindigul, too weakened the situation.
Between October and November, Dindigul market had exported 90 per cent of small onions to these countries. Now, traders were struggling to export even 10 per cent of the total arrivals.
“Domestic market alone is not enough to sell the entire arrivals,” adds Rajendran. “If this trend continues, farmers would face worse situations in the coming months because onions produced from Udumalpet, Thuraiyur, Tiruchi and Perambalur, some of the major onion producing centres in the State, too would flood the market in the next two months.”
“When there is a sharp fall in production, traders make spot procurement. Now, we bring onions to the market and we have to bear the freight charges. With sharp increase in diesel prices, truck operators have increased freight charges exorbitantly. Present procurement price does not match even freight charges and production costs”, says Guruhitha Naicka, another farmer from Kollegal.