Within the last two weeks, the price of onion has sky-rocketed affecting the consumers severely. The price of small onion, which is consumed more in Tamil Nadu, is also showing an increasing trend.
A report from TNAU stated that excess rain in the states of Maharashtra, Karnataka and Andhra Pradesh reduced the production of onion by 25, 70 and 50 per cent respectively, resulting in price hike of the commodity, which is expected to last till mid-December. Upon new harvest, the price of the commodity is anticipated to reduce.
Ban on onion export imposed by the Central government from mid-September 2020 has controlled the price raise to certain extent. Previously, the Government removed restrictions on export and lifted Minimum Export Price (MEP) for onion during March 2020, which was fixed at 850 USD per tonne in September 2019.
Small onion/ shallot is cultivated widely in Tamil Nadu. Currently, the crop is heavily affected by basal rot disease within 40 days of sowing. The disease has been observed for the last two years in the onion cultivating areas of the State.
Current onion stock is expected to meet the demand for next 40 days. At present, the total stock in Tamil Nadu is 25000 tonnes, which arrived from the districts of Namakkal, Thiruvannamalai, Tirunelveli, Kallakurichi, Theni, Ariyalur, Perambalur, Thuraiyur, Madurai and Dindigul. Moreover, onion cultivation is highly dependent on farm laborers as there is no utilization of farm machinery.
As per the trade sources, the current price hike is expected to last till the end of December 2020 and it will reduce by January – February 2021 during the onion harvest period.