Nashik, situated in northern Maharashtra, the epicentre of India’s onion trading where approximately 37% of the country’s total onion output is traded, is facing turmoil. Around 600 traders from all 15 Agricultural Produce Marketing Committees (APMCs) have initiated an indefinite strike.
This move ensures that the traders will abstain from participating in onion auctions in mandis, potentially triggering a nationwide onion supply crisis.
Uttam Kadam, an onion expert, informed TDG that the root of the problem lies with two central government agencies: the National Agriculture Cooperative Marketing Federation of India Limited (NAFED) and the National Cooperative Consumers Federation of India Limited (NCCF). These agencies have been procuring onions directly from the farmers and offering them to APMCs across the country at significantly lower prices than what the traders charge their bulk buyers, creating a price discrepancy of 600-700 rupees per quintal.
Kadam highlighted that these central agencies are distributing onions at an average rate of 1500 rupees per quintal in wholesale markets, whereas in Lasalgaon APMC, India’s largest onion market, the rate is 2000 rupees per quintal. Furthermore, traders have calculated the transport and labour costs to be approximately 2500 rupees per quintal, factoring in 300 rupees and 150 rupees respectively.
The Traders Association has submitted a memorandum to the Chief Minister and the Marketing Minister outlining their demands. The lack of resolution in the government-convened meeting led to the closure of 17 agricultural produce markets in the district, including Lasalgaon. This shutdown, slated to be indefinite, predicts a daily business loss ranging between 30 to 40 crores rupees.
The association’s demands include:
Raising the market fee charged by market committees to 0.50 paise per 100 rupees, from the current 1 rupee.
Implementing a uniform 4% duty rate for seller collections nationwide.
Immediate cancellation of the 40% duty on onion exports.
Facilitating the purchase of onions through NAFED and NCCF within market premises and distributing them via ration.
Introducing a 5% trade subsidy for traders and a 50% domestic transportation subsidy to stabilise onion prices. Traders express strong discontentment towards NAFED and NCCF for allegedly engaging in unethical practices as central agencies.
Adding to the precarious situation is the severe drought afflicting northern Maharashtra, threatening to impede onion production further. This agitation compounds the looming onion price surge, especially with the approaching Hindu festivals.