Why in the News?

• Maharashtra’s onion farmers are protesting after prices crashed below production costs, demanding compensation, stable export policies, and procurement support.

What’s in Today’s Article?

• Onion Production (Introduction, Statistics, Challenges, etc.)
• News Summary (Farmers’ Protests, Demands, Impact, etc.)

Onion Production in India

• India is the world’s second-largest producer of onions, after China, with annual production averaging 25–30 million tonnes.
• Maharashtra, Madhya Pradesh, Karnataka, Gujarat, and Rajasthan are the leading producers.
• The country grows three onion crops, Kharif, Late Kharif, and Rabi, with Rabi onions having higher storage potential and accounting for nearly 60% of annual output.
• Maharashtra dominates production due to a favourable climate and large-scale cultivation in districts like Nashik, Ahmednagar, Pune, and Solapur. However, despite its massive output, the sector faces persistent problems.

Challenges Faced by the Onion Sector

• Price volatility: Onions often witness extreme price fluctuations due to excess production, poor storage, and sudden export restrictions.
• Storage losses: A significant portion of Rabi onions deteriorates due to poor storage infrastructure, leading to wastage and distress sales.
• Export policy flip-flops: Frequent bans and restrictions undermine India’s credibility in global onion markets, leading to competitors like China and Pakistan capturing India’s lost share.
• High production costs: Fertilisers, seeds, storage, and labour raise production costs to Rs. 2,200–Rs. 2,500 per quintal, but farmers often receive far less in the market.

News Summary

• Farmers in Maharashtra began agitating on September 12, 2025, after onion prices fell sharply.
• Currently, they are receiving only Rs. 800-Rs. 1,000 per quintal, less than half the cost of production.
• The crisis worsened because Rabi onions stored in anticipation of higher prices began deteriorating, forcing distress sales.
• Adding to the distress, the government released buffer stocks into the market through the National Cooperative Consumers’ Federation (NCCF) and National Agricultural Cooperative Marketing Federation of India (NAFED).
• While the buffer stock policy aims to stabilise consumer prices, it further dragged down wholesale rates, aggravating farmers’ losses.
• Farmers’ Demands

• A compensation of Rs. 1,500 per quintal for the losses.
• Immediate halt to the sale of NCCF and NAFED buffer stocks in cities.
• A uniform and stable export policy to restore trust among importing nations.
• Discussions with key buyers like Bangladesh and Sri Lanka, which were once major markets for Indian onions.

• Impact of Export Policy
  • India exported 25.25 lakh tonnes of onions in 2022–23, but exports fell drastically to 11.47 lakh tonnes in 2024–25.
  • This sharp fall eroded India’s competitiveness, with buyers shifting to China and Pakistan.
  • Experts argue that inconsistent export policies have damaged India’s reputation in global markets.
• Alternative Solutions Suggested

• Farmers and exporters have urged the government to incentivise exports to regain India’s lost market share.
• Replicating Andhra Pradesh’s procurement model, where onions are purchased at Rs. 1,200 per quintal, is being suggested for Maharashtra to ensure a minimum support price.
• Long-term measures such as cold storage expansion and farmer-producer organisations (FPOs) for collective bargaining have been emphasised.

Conclusion

• The onion crisis in Maharashtra reflects the deep-rooted systemic flaws in India’s agricultural pricing and export policies.
• While buffer stock release and price stabilisation policies aim to protect consumers, they often end up hurting farmers.
• The current protests underline the urgent need for structural reforms, from stable export strategies to better procurement models and infrastructure upgrades.
• Without these, India’s onion farmers will remain at the mercy of volatile markets, recurring protests, and policy inconsistencies.