India's onion problem continues

Indian farmers planted a bumper onion crop, expecting to reap high prices. Yet the opposite has happened; overproduction has caused prices to drop so low, growers are unable to even cover the cost of production. In Maharashtra Pradesh onions are selling for 20 paisa per kg and it's not the first time India is witnessing such a phenomenon. 

Good quality onions which should fetch at least Rs.10 per kg are selling way below the cost of production. Manish Behl Int'l Business Consultant, reports that in some places farmers are ready to dump the onion for free as it does not recover even the cost of transportation to the local AMPC.

Trader and local Markets are still selling onions between Rs.18 to Rs.25 per Kg. 

Yet the consumers don't see the effect of reduced onion prices on their local markets. Sometimes the country suffers from too little stocks and sometimes of too much production. 

Either way the farmers and consumers both suffer. Farmer don't have holding capacities hence they can't hold the stocks .. neither does the consumer, even after knowing that prices will rise during the rains they can't hold onto onions either. 

There will be an upswing for sure and the onion prices will surge eventually.

Source: Linkedin- Manish Behl, Int'l Business Consultant, Executive Coach, Start Up Mentor and Business Advisor. 

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