Onion farmers end 10-day old strike; expect govt to lift export ban
Moneylife Digital Team 14 February 2011

With onion prices having dropped considerably over the past few days, onion growers have been holding back stocks hoping for a better price through exports

Onion growers from Nashik in western Maharashtra, one of the principal onion-growing areas, have called off their 10-day strike in anticipation that the central government will lift the ban on export of the onions soon.

The onion farmers from the region were on strike at the Lasalgaon onion market, Asia's biggest onion market over the past 10 days to demand that the ban on export of onions be lifted. The export brings better returns for farmers than what they earn from selling their produce at the Agriculture Produce Market Committee (APMC) market where wholesale prices have dropped recently.

The Press Trust of India has reported that onion growers from the Nashik region are holding their stocks in anticipation that the government will lift the export ban and they will be able to earn handsome returns. Over the past fortnight, the prices of onions crashed to Rs4-10 per kg in the wholesale market.

"Farmers are hoping that the government will lift the export ban on onions, which will get them fair prices, hence the strike was called off. They are also holding their produce as they are anticipating exports will open up," said RP Gupta, director of National Horticulture Research Development Foundation (NHRDF), which monitors onion prices.

A trader at the Lasalgaon market told Moneylife over the telephone, "The situation and supply of onions was tight due to the strike, which has now been called off."

The government banned shipment of onions abroad in December last year to rein in domestic prices that had soared to Rs70-85 a kg in the retail market. Maharashtra chief minister Prithviraj Chavan and union agriculture minister Sharad Pawar have urged the Centre to lift the export ban completely.

"The government is giving its attention at the highest level, to what has been said by the Maharashtra chief minister and union agriculture minister," commerce and industry minister Anand Sharma had said in Delhi last week.

According to Mr Gupta, "The wholesale prices of the onions at Lasalgaon APMC market today was at about Rs417 per quintal (minimum) and Rs1,114 per quintal (maximum). The model onion prices were around Rs1,000 per quintal." (Nearly 80% of the onion produce is rated in the 'model onion' category.) "Around 8,320 quintals reached the market today by 1.30pm, as compared to 14,000-15,000 quintals that generally arrives at the market daily," he said.

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