Tears of farmers have set onions on fire. When will prices cool down?

It’s not the usual tears from slicing onions but the exorbitant prices that are making people weep. Hitting up to Rs 100 a kilo in several cities, onions have become a luxury for households. Though a shortage of onions, that drives up prices, isn’t unusual around this time of the year, what is unusual is the extent of the crisis. Behind the price rise of onions this year is the tears that farmers have shed for two years.
While consumers are hammered by soaring onion prices, the root cause lies in the frustration of farmers, who have long suffered from fluctuating prices and government interference. The distress sales that they had to resort to for the last two years, have a direct relation to the price rise of the essential kitchen commodity. We will give the details later.
The sharp hike also coincides with the election for Maharashtra Assembly on November 20. The western state is the largest producer of onions in India, accounting for around 43%. The election in Maharashtra is also being seen as a factor determining the supply and price of onion in the markets.
On November 6, the wholesale price of onions in Nashik’s Lasalgaon, India’s biggest onion mandi, hit a five-year-high, soaring to Rs 5,656 per quintal. This translates to a wholesale mandi price of Rs 56.56 per kg in India’s major bulb market.
In major cities, Delhi, Lucknow, Kolkata and Chandigarh, onion retail prices even touched Rs 100 a kilogram, Rs 40 more than what the Price Monitoring Cell (PMC) of the Ministry of Food and Civil Distributions claimed it to be.
On online quick-commerce platforms, onion is now being sold at Rs 70- Rs 80 a kilogram, a slight decline from last week’s Rs 90-Rs 100.
On November 5, National Cooperative Consumer’s Federation (NCCF) Chairman Vishal Singh told India Today TV that prices would come down from October 8.
It’s been over 10 days, but the situation has improved much.
Last week, the Centre said it decided to mobilise buffer stocks, aiming to “stabilise the onion prices”.
Onion prices have surged after a period of stability throughout most of the year.
The rise in onion prices stems from the near depletion of old stock from the previous rabi harvest in March 2024. As a result, there is a delay in the arrival of the fresh crop due to rain in Central India.
The Rabi sowing of onions for the next harvest cycle is currently underway in north India. Meanwhile, the onions available in the market are primarily sourced from cold storage facilities, as the Kharif onion harvests from Maharashtra and Madhya Pradesh have not been adequate to fulfil the demands of Indian markets elsewhere, according to Om Prakash, an agriculture expert with Kisan Tak.
“This seasonal supply gap, typical at this time of year, has a role to play in disruption and has resulted in an imbalance between demand and availability, driving up prices,” Om Prakash tells India Today Digital.
The central government maintains that farmers are receiving better prices than in the previous year, but Bharat Dighole, the president of Maharashtra Onion Producers Association, argues that this is too little, too late.
Over the past year, onion production in India plummeted by 59.96 lakh tonnes, particularly in major onion-producing states like Maharashtra, Madhya Pradesh, Andhra Pradesh, Tamil Nadu, and Telangana.
In Maharashtra, onion production fell from 136.69 lakh tonnes in 2021-22 to just 86.02 lakh tonnes in 2023-24. Similarly, Madhya Pradesh, the second-largest onion-producing state, saw a decline from 47.41 lakh tonnes to 41.66 lakh tonnes in the same period.
The central government is under pressure to balance the needs of both farmers and consumers, and its policies have left farmers feeling betrayed.
Ahmednagar farmer Bajirao Gagare, while speaking to India Today Digital’s sister portal Kisan Tak, blamed the government for the drop in onion production. He said that artificially low prices in the past had discouraged farmers from cultivating onions.
If prices had been stable or more favourable, Bajirao Gagare argues, farmers would not have reduced their onion sowing area.
The decrease in acreage for onion cultivation and harvest has resulted in a price spike.
Between 2021 and 2024, the area under onion cultivation has decreased by 4.04 lakh hectares, according to data from the Union Agriculture Ministry. Bharat Dighole, president of the Maharashtra Onion Producers Association, points out that every time onion prices rise, the government intervenes to appease consumers by reducing export opportunities or imposing stock limits.
“The government can see the tears of consumers, but it refuses to acknowledge the pain of farmers,” Dighole laments.
“Farmers have been shifting to other crops due to the financial losses they’ve suffered from low onion prices. This has left farmers with no incentive to continue growing onions when they consistently face the risk of selling at a loss”, agriculture expert Om Prakash tells India Today Digital.
Further, according to the Directorate of Onion and Garlic Research, 30% of onions are lost to weight loss, germination, and rotting, each year.
Union Minister of Agriculture and Farmers Welfare Shivraj Singh Chauhan on the election trail in Maharashtra said that the Centre has a policy in place to fix prices for essential crops like onion, tomato and potato that will be fixed.
However, farmer leader Vikash Singh, who closely monitors onion farming, exports, and prices, tells Kisan Tak that prices will not ease until more onions come into the markets of increase in Maharashtra, as the state accounts for 43% of the country’s total production.
The arrival of new onions, which has been delayed due to rain, is expected to be seen by the end of November, potentially bringing some relief.
Meanwhile, the arrival of new onions from Alwar, Rajasthan, has already begun in Delhi’s markets.
However, despite the release of buffer that is just 2% of India’s onion production, the impact on the ground may not be felt until mid-December.
Maharashtra farmer leader and former MP Raju Shetti, in a conversation with Kisan Tak, signalled that the central government might reimpose an export ban on onions after the Assembly elections.
The Centre in May had lifted the ban on onion exports but imposed a minimum export price. Later in September, the government removed the minimum export condition on onion exports with immediate effect.
With the arrival of the new crop and some curbs, prices of onion are likely to come down by December. What has to be managed is the sowing area, otherwise farmers will keep shedding tears, which will end up making consumers cry.