After eye-watering prices, Centre tells states to expand onion farm acreage

Production of onions during the monsoon seasons is expected to have fallen short of the output last year during the same period. (PTI)
Production of onions during the monsoon seasons is expected to have fallen short of the output last year during the same period. (PTI)

Summary

  • The Union agriculture department has written to state governments to increase cultivation of onion in non-traditional as well as irrigated areas to make up for production shortages of the crop during the monsoons

The Union government has directed states to increase the area allocated for onion cultivation during the rabi, or winter, season, in another effort to make up for shortages and contain prices of the food staple, according to two senior officials.

Erratic rains and extended dry spells hit onion production during the kharif and late kharif (monsoon sowing) seasons, making for a potentially hot button political issue with the national election due in a few months.

The government recently also banned onion exports to augment domestic supply and keep prices in check. Though the price of onion has eased in recent days, the government is on watch to not let it increase due to the tightness in supply, one of the officials said. Both the officials declined to be identified.

On Monday, the all-India average retail price of onion was Rs55.8 a kg, down 6% from the preceding month, but an eye-watering 112% increase year-on-year, as per consumer affairs ministry data.

The rabi season accounts for nearly nearly 80% of India’s total onion output.

The horticulture department and the agriculture ministry didn’t immediately reply to queries from Mint.

“Because of late rainfall in the kharif season and extended dry spells in late kharif, the area (of onion cultivation) came down. Some damage was also reported due to recent hailstorms," said the official mentioned above. “A team of officers from the agriculture and consumer affairs departments visited Karnataka two to three weeks ago and now they are in Maharashtra."

These two states are among the country’s top producers of onion.

Patchy monsoon and dry spells lowered the kharif onion cultivation area in Maharashtra to 86,000 hectares in the 2023-24 kharif season from the previous season’s 90,000 hectares. Production is estimated to have fallen to 750,000 tonnes from 798,000 tonnes.

In Karnataka, the acreage fell to around 110,000 hectares from 145,440 hectares and production to 770,000 tonnes from the previous kharif season’s 1.7 million tonnes.

Overall, onion production in the 2022-23 crop year is estimated to have dropped 4.7% on year to 30.2 million tonnes, according to agriculture ministry officials.

“There is a real concern about kharif and late kharif production. So far, the price has not increased further but the availability concern is still there," said the official quoted above. “Nothing is final on crop estimates… estimates are still coming… but so far what we have gathered is that the crop was significantly lower in both seasons."

The agriculture department has written to state governments to increase the cultivation of onion in non-traditional as well as in irrigated areas such as Ahmednagar, Solapur, Pune, and Beed, the official said. 

“In terms of giving subsidies to farmers to encourage them to increase onion cultivation area, the government keeps procuring. Now the buffer target is 700,000 tonnes, and it has already procured 510,123 tonnes," the official added. 

An additional 200,000 tonnes of onions will be procured from kharif season output, consumer affairs secretary Rohit Kumar Singh said at a briefing on Monday. The government currently has 50,000 tonnes to 1 mt of onion in its buffer stock, he said.

As per the government’s preliminary assessment, India may have produced 3 million tonnes (mt) and 1.5 mt of onion in the 2023-24 kharif and late kharif seasons, respectively, which was significantly lower than the 4.1 mt and 2.4 mt produced in the respective seasons last year.

In the previous rabi season, onion production was at 24.6 mt. Average monthly domestic consumption was 1.4-1.7 mt, but that may be lower now depending on the price.

In the 2022-23 crop year, India had produced 30 mt of onions. 

The Union government has also written to the National Horticultural Research and Development Foundation to ensure sufficient planting materials for states. 

States have been directed to also create additional storage facilities with farmers producers organisations under the Mission for Integrated Development of Horticulture to handle additional production. 

Transplanting of rabi onion takes place between November and January, and harvesting starts from March. Traditionally, 900,000 hectares to 1 mh are dedicated for rabi onion in major producing states. Maharashtra accounts for about half of the area, of which 40% comes from Nashik district alone.

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