Price fluctuations lead to uncertainty for onion farmers

City has stopped receiving imported onion; with Indian arrivals picking up, prices to fall further

January 29, 2020 12:24 am | Updated 04:30 am IST - Coimbatore

Prices of small onion have decreased in the Coimbatore wholesale market on Tuesday.

Prices of small onion have decreased in the Coimbatore wholesale market on Tuesday.

Mahalingam, an onion farmer in Thondamuthur, had five acre under small onion a couple of months ago. While he used to reap nearly 25 tonnes a season, he harvested just 14 tonnes last season.

That was because of unseasonal rain, he says. However, he was able to sell for ₹70 to ₹100 a kg. He will plant small onion again in a couple of months, but is unsure of the prices.

“Many farmers suffered losses last season as yield was affected. The previous season I had stored onion spending a lot on creating the infrastructure for storage. But the prices never went beyond ₹20 a kg,” he says.

In the Palladam - Udumalpet belt, farmers have gone in for small onion on nearly 7,000 acre. “It is difficult to forecast the price for onion. We need to get ₹30 to ₹ 40 a kg to earn profit,” says M. Palanisamy, a farmer in Palladam. He had harvested onions just before Deepavali and the prices were low though the prices shot up in two weeks after that.

At Thalavadi in Erode district, some of the farmers are harvesting small onion now. “The prices are ₹50 a kg and even if we get ₹40 a kg, it will be profitable. But, the winter is severe and the plants are not surviving,” says Manikandan, an onion farmer.

The wholesale price of small onion in Coimbatore market on Tuesday was ₹50 a kg for good quality and in the case of big onion, it was ₹35 a kg. With about 60 wholesale traders, Coimbatore receives nearly 500 tonnes of big onion and 200 tonnes of small onion a day. The current arrivals are from Maharashtra in the case of big onion and from Rasipuram and Sathyamangalam area in the case of small onion.

“From ₹120 to ₹150 a kg last month, prices have fallen to ₹50 a kg or lesser now. The prices are expected to fall further as the season has picked up in Maharashtra for big onion. Small onion arrivals from Karnataka will start in 15 days and the prices may drop further,” says M. Rajendran, president of the Thyagi Kumaran Market Vegetable Merchants Association.

The city has stopped receiving imported onion as there are no takers.

With Indian arrivals picking up in the coming weeks and prices expected to fall further, the government should encourage exports now so that farmers do not suffer losses. Last year, till April, the wholesale price of big onion was ₹12 a kg. Price fluctuation for onion is steep, he says.

The farmers point out that most of the onion farmers in Tamil Nadu have small land holdings unlike as in Maharashtra or Karnataka. The labour wages have shot up and fluctuation of prices is frequent and steep. The government should fix a minimum price for vegetables, says Mr. Palanisamy.

There is no technology intervention that will help mechanise harvest or financial support to set up storage facilities. Hence, costs keep moving up every year. “There are many farmers who suffered losses last season,” says Mr. Mahalingam.

This year, water availability is relatively better and more area is expected to come under onion in this region. Hence, there will not be shortage in availability. But prices might drop, fear the farmers.

The District’s Lead Bank Manager S. Venkataramanan says there are several schemes in all the banks that support farmers in allied activities. For instance, NABARD has a subsidy scheme for agri marketing infrastructure.

Under the programme, subsidy is available for small-scale farmers too. But, the infrastructure should be used for the intended purpose and should be built according to specifications. He urged the farmers to make use of these schemes.

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