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Current Affairs

Rise in onion prices

Date: 25 October 2020 Tags: Agriculture

Issue

With less than a week to go for the Bihar elections, the Centre has reintroduced the stock limit on onions to control rising prices.

 

Background

Barely a month ago, Parliament had amended the Essential Commodities Act, 1955 to exclude onions from the list of essential commodities, thus freeing them from stock limits. 

 

Details

  • Prices of onion has been rising since the last week of August, as reports started coming in of massive losses to kharif onions caused by heavy rainfall in north Karnataka.

  • This crop was meant to arrive after September and was expected to feed the markets until the arrival of the kharif crop from Maharashtra towards the end of October.

  • There are three main onion crops — kharif (June-July sowing, post-October harvest), late kharif (September sowing, post-December harvest), and Rabi (December-January sowing, post-March harvest). 

  • Farmers, especially in Maharashtra, store it in on-field structures called kanda chawls to protect it from moisture and light. This crop feeds the markets till the next one arrives.

  • The heavy rain in September not only destroyed the new crop in Karnataka but also took a toll on stored onions in states like Madhya Pradesh and Gujarat.

  • The government has made relaxation of import norms, to allow easy shipping in from Iran, Turkey, and other onion-producing nations.

  • Farmers and agricultural officers have talked about a dire shortage of onion seeds, which can cast a shadow on the all-important rabi season.

  • Normally, farmers generate their own seeds by allowing a portion of the crop to flower and then produce seeds. However, this season, they skipped this step and sold their entire crop in view of the good prices being offered.

  • Non-availability of good seeds has caused concerns and the available seeds are being sold at a premium.