Onion prices at Rs 100 per kg: Govt should explore Israel, Brazil models for storage, says FICCI
India, which is currently witnessing a spike in retail onion price up to Rs 100/kg on tight supply, should explore low-cost modern technology models from countries like Israel and Brazil for storing the commodity, industry body FICCI said on Friday
For ensuring cost-effective storage of onions, FICCI said the emphasis should be laid on building low-cost farm gate storage
It may be noted that the government is currently incurring losses due to 25 percent wastage in the buffer stock of 57,000 tonnes onions created for the first time
Onion prices have risen sharply because of excessive rains in Karnataka, Maharashtra and Madhya Pradesh which produce 60 percent of India's onion
New Delhi: India, which is currently witnessing a spike in retail onion price up to Rs 100/kg on tight supply, should explore low-cost modern technology models from countries like Israel and Brazil for storing the commodity, industry body FICCI said on Friday.
The government's Tomato Onion Potato (TOP) scheme announced in the 2018-19 Budget was expected to address the problem of surplus in producing areas, but the scheme has not taken off, it said, adding that the government should provide railway rakes for reducing transportation cost.
FICCI stated that ad-hocism in export bans had serious repercussions and there was a need to remove onion from the purview of the Essential Commodities Act and undertake agriculture marketing reforms to facilitate a direct purchase from the farmer in a transparent way.
Onion, being high in water content, is a delicate commodity to store. Up to 40 percent of the total produced onions can be damaged in some areas in periods of high rainfall due to non-availability of appropriate post-harvest storage facilities, it added.
"Many factors have contributed to the run-up in onion prices this year. ...However, the seasonal price and arrival pattern of onion, could give some directions to strategise a sustainable policy in future," the FICCI said in a report submitted to the government.
To address the current onion crisis, FICCI said the government should focus on a long-term solution including studying the Israel and Brazel models and making an investment in low-cost modern technology for storing onion.
"In Israel, onions are stored in open ventilated warehouses with continuous forced air-ventilation through a stack of sets in bulk or bulk bins. Adoption of such measures will help in the storage of onions with innovative methods during the bumper production seasons and reducing the fluctuations in the onion prices. Such methods should be studied and customised for Indian conditions," it said.
For ensuring cost-effective storage of onions, FICCI said the emphasis should be laid on building low-cost farm gate storage.
In Brazil, for the procurement and storage of onions, low-cost ventilated silos system is being used at farm level. They also use refrigerated storage rooms which is the most efficient system, it said.
In India, startups such as Inficold Inc are using multi-commodity efficient farm level cooling systems for perishables. Low-cost thatched bamboo storage have been promoted by the government under the Mission for Integrated Development of Horticulture. "However, we need better technology to reduce losses during monsoon," it said.
Onion is cultivated in various parts of India almost throughout the year and can be made available in fresh form, except in the months of July, August and September.
To maintain regular supply in this lean period of about three months, onions are being traditionally stored in ventilated warehouses (in bulk) where the losses are very high (range between 20-40 percent mainly because of poor pre-harvest and post-harvest practices).
"There is a need to invest in research to find optimum technological solution for storage of onion. The losses are likely to come down to about 5-10 percent by following the standard operating procedure of storage," the FICCI said.
Besides that, the method of storing onion crop should not be considered similar to normal agriculture produce such as grains and potatoes.
"Technological innovations for storing onions are required in the long run. The Indian Council of Agricultural Research (ICAR) research institutes and State Agriculture Universities should play a serious role and government should engage with Indian Institutes of Technology (IITs), Indian Agricultural Research Institute (IARI) and other research institutions," the FICCI said.
Developing production protocols and standardisation of onions requires a focused research and result-oriented planning by ICAR established Directorate of Onion and Garlic Research, it added.
Among other solutions, FICCI said the government should undertake a special campaign to promote processed onion and increase investment in producing dehydrated variety of onions which has a long shelf life and has export potential.
It may be noted that the government is currently incurring losses due to 25 percent wastage in the buffer stock of 57,000 tonnes onions created for the first time.
Onion prices have risen sharply because of excessive rains in Karnataka, Maharashtra and Madhya Pradesh which produce 60 percent of India's onion.
External factors such as climatic changes, deficient rainfall leading to delayed sowing and abnormally high rainfall in September were beyond the control of the government, the industry added.
Onion prices touch Rs 150 per kg in Hyderabad; citizens demand government reduce rates amid price hike
Poor and middle-class people in Hyderabad city are having a tough time managing their kitchen supplies as the onion prices have touched Rs 150 kg in the city
"The situation is very serious. We are trying to stabilise the prices," Sheila Dikshit said.
The Union minister admitted that some unscrupulous traders made profit due to the crisis but denied his party NCP having any links to cartelisation.