Farmers Unwilling to Sell Onions to NAFED and NCCF as Open Market Prices Remain Higher

The government's target of procuring 2 lakh tonnes of onions through NAFED and NCCF under the Price Stabilisation Fund (PSF) is proving difficult to achieve as farmers in Maharashtra are getting much higher prices in the open market. While the procurement agencies are offering Rs 1,730 per quintal, good-quality onions are selling for up to Rs 3,000 per quintal in major mandis, leaving little incentive for farmers to participate in the scheme.

To assess the current onion market situation, Rural Voice spoke with officials of APMCs in Lasalgaon - the largest onion market - as well as Pimpalgaon, Manmad, and Ahilyanagar (formerly Ahmednagar) in Maharashtra.

Narendra Wadhavane, Secretary of the Lasalgaon APMC, told Rural Voice that around 25,000 quintals of onions are arriving in the market every day. Farmers are receiving an average price of Rs 2,100 per quintal, while Grade-A onions are being sold for as much as Rs 2,600 per quintal. As a result, farmers are not interested in selling onions to NAFED and NCCF.

The government has increased the procurement price for NAFED and NCCF three times over the past month. On May 22, the rate was raised from Rs 12.70 per kg to Rs 15.80 per kg. It was further increased to Rs 16.50 per kg on June 13. Just a week later, on June 20, the government again revised the procurement price upward to Rs 17.30 per kg.

Apart from the price gap, the procurement process and payment delays are also discouraging farmers. Wadhavane explained that in the open market, traders purchase onions immediately and make prompt payments. However, farmers wishing to sell to government agencies must first register. The agencies then call farmers for procurement, inspect and grade their onions, and may reject lower-quality produce. Even after completing these formalities, farmers receive payment only after 72 hours.

In Manmad mandi, also located in Nashik district, Secretary Baliram Laxman Gaikwad said that farmers are currently bringing 7,000 to 8,000 quintals of onions daily. Grade-A onions are fetching up to Rs 2,400 per quintal, while the average price is around Rs 2,000 per quintal. Here too, NAFED is finding it difficult to procure onions because open market prices are higher.

Pimpalgaon Baswant, another major onion market in Nashik district, is also witnessing a similar trend. Secretary Satish Diliprao Jadhav said that around 20,000 quintals of onions arrive there every day. Depending on quality, farmers are receiving between Rs 1,400 and Rs 3,000 per quintal, with average prices ranging from Rs 2,200 to Rs 2,300 per quintal. Consequently, farmers are not willing to sell onions to government agencies.

Ahilyanagar district is another important onion-producing region in Maharashtra. Abhay Babasaheb Bhise, Secretary of the Ahilyanagar APMC, said that around 48,000 quintals of onions arriving there daily. Farmers are receiving prices of Rs 1,700 to Rs 1,800 per quintal. A significant portion of the onions arriving in this market is being shipped to other states.