onion

The rising prices of onions in India have caused distress among consumers. While farmers are selling their produce in the wholesale market at an average price of ₹29-30 per kilogram, the same onions are available to consumers in the retail market for ₹60 per kilogram or more. The question arises: who is benefiting from this price gap? Let's explore the key reasons for this issue and possible solutions.

Gap Between Wholesale and Retail Prices: Who Is Responsible?

Wholesale Market Situation According to Agmarknet data, the average wholesale price of onions on December 16, 2024, was ₹2822.46 per quintal. Last week (December 9), the price was ₹3601.54 per quintal, showing a decrease of nearly 21% within a week. Despite this fall, the retail market prices have not been affected.

Retail Market Price Increase Everyday vegetables like potatoes, tomatoes, and onions are still being sold at high prices, ranging between ₹40-60 per kilogram. The significant price difference between wholesale and retail is primarily due to intermediaries and traders who buy from farmers at lower prices and sell at higher rates in the retail market.

Price Comparison with Previous Years Onion prices have seen considerable fluctuations in recent years:

• 2023 (December 16): Average wholesale price ₹1984/quintal.
• 2022 (December 16): Average wholesale price ₹1164/quintal. These figures show a consistent increase in wholesale prices year after year, but farmers have not benefitted fairly from this rise.

Profits Go to Middlemen

• Middlemen's Role: Both farmers and consumers are at a disadvantage. The most profit from the price difference between wholesale and retail prices is made by traders and middlemen.
• Government's Efforts Falling Short: The government's initiative through the NCCF to sell onions at ₹35 per kilogram was not effective enough to control prices on a large scale.

Main Reasons Behind Price Increases:

1. Demand and Supply Imbalance: While there is a steady supply of onions in the markets, consumers are not benefiting from this in the retail market.
2. Dominance of Middlemen: Farmers are forced to sell their produce at low prices, while consumers are paying higher prices.
3. Logistics and Storage: Limited facilities for transporting and storing onions also impact the prices.
4. Uneven Distribution: Prices are higher in big cities, while they may be lower in rural areas.

Suggestions for the Government and Farmers:

1. Promote Direct Market Models: Establish direct communication between farmers and consumers.
2. Effective Price Control: Government intervention is needed to balance prices in wholesale and retail markets.
3. Improve Storage Facilities: Better storage arrangements for perishable crops like onions should be made.
4. Monitor Middlemen: Strict control over the profits of traders and middlemen should be implemented.

Conclusion: The rising onions  price are a matter of concern for both farmers and consumers. While farmers are unable to get fair prices for their hard work, consumers are forced to buy vegetables at higher prices. In this scenario, the government and relevant agencies need to take action to bridge the gap between wholesale and retail markets.