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Farmers continue to suffer despite bumper onion crop

Government intervention and lifting of the ban on onion exports have failed to bring respite to the onion growers in Maharashtra. Prices have fallen due to a bumper crop of about 5.5 million metric tonnes and lack of demand, triggering mass agitations by farmers.

Onion prices plummeted to below Rs 100 per quintal this week from the state government's offered support price of Rs 300-350 per quintal in the wholesale markets in Nashik district, Maharashtra.

''There is a surplus crop of about 1.5 million tonnes over the average total crop in the state this year. Although the government has lifted the ban on onion exports, the crisis has taken a new turn as traders have lost their grip on the international market following Pakistan's dominance in the overseas market in the absence of Indian onions for the last two years,'' says Kalyanrao Patil, a legislator and chairman of the Agriculture Produce Market Committee at the production centre of Lasalgaon.

Lasalgaon in Nashik district is the largest onion market in Asia while Nashik, Pune, Ahmednagar and Jalgaon districts form the country's largest onion producing belt. Besides these centres in Maharashtra, the bulb crop is also grown in Gujarat and Bihar.

''We have lost our contacts in the last two years as the ban forced us to stop all exports. The ban was lifted at a time when onions from Pakistan were available in the overseas market at a price far cheaper than ours. Pakistani onions are now being sold at $ 150 per tonne against ours that are priced at $ 190,'' a dealer at the Jackson Trust, a leading Bombay-based onion export firm, said.

The state government has started purchasing onions through the Maharashtra Marketing Federation to arrest a further fall in its price. The government has already opened its purchase centres at Chandwad and Lasalgaon (Nashik). Besides, the Maharashtra Marketing, National Agriculture and Cooperative Marketing Federation and Gujarat Agro Industries Limited have also started purchasing onions.

However, the farmers are unhappy with the government marketing agencies for allegedly adopting a ''choose and pick up'' policy and for its ''unwarranted rules'' for the purchase of onions. Already the growers have had a few rounds of flash agitations in different part of Nashik district.

Farmers are livid that government agencies have begun demanding crop records prior to purchases. Farmers say they have not recorded their produce so as to avoid certain taxes. ''We would have recorded our produce had we been intimated at an earlier date about these new rules,'' said a farmer from Chandori (Nashik district).

Officials at the marketyard of the production centres said such proofs were necessary since the government is offering a support price significantly higher than the prevailing market price. It needs to be verified whether the farmers owe the government any dues, he said.

The legislator from Chandori alleged that the situation came to such a pass because of ''gross mismanagement'' and lack of coordination between the procuring agencies and the government.

Caught in the middle of such hassles, it is the small farmer who is suffering the most.

Till the recent past, the country was one of the major onion exporting countries along with Pakistan and Iran. The onion varieties of Nasik and Pune belts used to be in good demand in the Gulf countries.

In 1998, the price of the bulb crop touched Rs 4,000 per quintal in the Nashik market, pushing up the retail price in markets across the country. To calm public sentiment, the national government banned its export.

The ban was lifted in February 1999. On farmers' insistence, the government allowed a small amount of export to check the falling prices.

According to Patil, 30,000-40,000 quintals of onion arrives in the wholesale markets of Nashik district every day and around 40-50 merchants are buying huge stocks. These merchants have their own storage and transport facilities and are buying the produce at prices below that quoted by the government.

Traders in Bombay also are reportedly holding back the stocks to profit at a later date. Although onion prices in the metropolis have gone up to Rs 8-10 per kg from Rs 4-6 in December, this is in conjuction with the recent imposition of a four per cent tax on all vegetable items.

Chandrakant Dayama, director, the APMC in Nashik district, said another important factor contributing to the huge onion stock in the market was that around 2,500 farmers had been given loans during the year at low interest rates to construct storages. These farmers wanted to hold on to their summer stocks till December.

He said, "since our exports are primarily to the countries in the Middle East, it is hoped that with the end of Ramazan today, the demand in these countries would go up.''

UNI

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