Disposal of onion is likely to take place through e-auction and retail sales on e-commerce platforms.
To curb price rise, the government on Friday announced sale of 0.3 million tonne (MT) of onion in the open market from its buffer stock. “We will release onions from the buffer stock immediately through open auction,” Rohit Kumar Singh, secretary, department of consumer affairs told FE. The quantity and pace of disposal will also be calibrated with the prices and availability situations to make onions available to consumers at affordable prices, according to an official statement.
Apart from market disposal, onions would be offered to state governments at discounted rates for sale through retail outlets of their consumer cooperatives and corporations.
Disposal of onion is likely to take place through e-auction and retail sales on e-commerce platforms.
The buffer stock will be released in the key markets and regions where retail prices are above the all-India average and where the rates of increase in prices over previous month and year are above the threshold, according to an official statement.
The farmers’ cooperative Nafed and National Cooperative Consumers’ Federation of India had procured 0.15 MT of rabi onion each in June and July from Maharashtra and Madhya Pradesh, respectively.
Recently, the prices have been looking up mainly because of prospects of supply constraints as unseasonal rains in April in key producing states of Maharashtra, Madhya Pradesh and Rajasthan hit the shelf-life of stored rabi harvests.
In addition, rabi areas have declined this season because of lower realisation earlier.
The benchmark prices at Lasalgaon, Maharashtra, the hub of the country’s onion trade, rose by 60% to Rs 2,200/quintal on Friday , from Rs 1,370/quintal on August 2. Two months back the prices were ruling around Rs 950/quintal.
The modal retail prices of onion rose from Rs 20/kg since the beginning of the year, to Rs 30/kg on Friday.Inflation in onion, which had been in the negative zone since September, 2021, came in at 1.65% in June 2023.
The rating agency Crisil in its report has stated that retail onion prices are expected to hit Rs 60-70/kg next month. However, the prices in October, considered a lean month, will remain below the highs of 2020 when prices rose to Rs 80/kg in several cities, Crisil has stated.
Rabi onions, harvested during April – June, accounts for around 65% of the country’s onion production and meets the consumer’s demand till the kharif crop is harvested from October-November.
Kharif harvested onions are not stored because of higher moisture content thus entering the market directly.
The estimated production of onions during the 2022-23 crop year (July-June) declined marginally 31.01 million tonne (MT) against 31.7 MT reported in the previous year. The output of kitchen bulbs was 26.64 MT in 2020-21.
Since the beginning of 2021, the government has not imposed a ban on onion exports, which was the norm a few years back. India exported a record 2.5 MT of onion 2022-23, which is an increase of 65% from the previous fiscal.
India is the biggest producer of onion and Maharashtra, Madhya Pradesh, Karnataka and Gujarat have more than 70% share in the country’s production.
Source:financialexpress.com