Onion prices go south owing to glut in Tiruchi market

Prices of onions in Tiruchi have dropped due to oversupply, causing farmers to suffer and demand export restrictions be lifted.

Prices of onions, both small (shallots) and Bellary varieties, have slumped over the past week following a glut in the market here.

Wholesale traders at the Tiruchi All Perishables Commission Mandis Commercial Complex, a major onion trade centre in the region, reported a fall in the prices of both the Bellary variety, procured from other States, and the locally grown shallots. The price of both varieties had touched a peak of ₹80 a kg in the wholesale markets here in October last year. Their prices were ruling between ₹20-40 a kg, depending upon the quality, about 10 days ago.

However, over the past week the prices of the both varieties have come down by half to ₹10-20 a kg. “Depending on their quality, the onions are being sold in three categories of ₹10, ₹15 and ₹20 a kilo,” said A. Thangaraj, general secretary, Tiruchi Onion Commission Mandi Traders’ Association. The retail prices normally rule higher by ₹5 a kg.

Attributing the fall in prices to heavy arrivals of both varieties, he said the wholesale market in Tiruchi was getting about 500 tonnes each of shallots and the Bellary variety every day. But the offtake from the market was much lower. “Arrival of Bellary onions from Karnataka and Maharashtra has peaked. So has supply of shallots from villages in Tiruchi, Perambalur, Namakkal and Kallkurichi districts. The offtake is just about 200 tonnes in each variety,” Mr. Thangaraj said.

Farmers and traders representatives say that more farmers had taken to cultivation of shallots attracted by the good price of ₹40-80 that the produce had fetched around October last year. But with the crop now coming to harvest simultaneously across the State, the prices have crashed. The Centre had banned export of onions till March on December 8 to curb surging prices in the domestic market. The ban has also contributed to the crash in the prices, they contend and demand that the restriction be lifted in view of the glut in the market now.

According to P. Viswanathan, president, Eri Mattrum Attru Pasana Vivasayigal Sangam, shallot growers are either turned away from the market by the traders, claiming that they had no place to stock, or offered a meagre price of ₹5-10 a kg. Farmers are the ones who suffer as intermediaries and traders, who often work in tandem as a syndicate, still manage to make profits, he contends.

“The Centre should allow exports when production is high and impose restrictions when there is shortfall. It should also fix the procurement price for onions. The State government should arrange procurement and sale of shallots through cooperative societies,” Mr. Viswanathan demanded.