Farmer distress Falling prices, failing hopes
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Why onion and potato cultivators in Uttar Pradesh, Maharashtra, and Gujarat are at breaking point, with produce being sold at
way below the cost of production, hitting them with debt and an uncertain future, explain Abhinay Deshpande and A.M. Jigeesh
On March 1, the Kokine brothers, Pandurang Bhaurao and Gyaneshwar Bhaurao, headed out in a mini truck loaded with onions to Lasalgaon, about 60 km away. Asia’s biggest wholesale onion market, it handles 3,000 tonnes of onions a day. They hoped they would get ₹400 to ₹500 per quintal for their yield from their agricultural land at Waki, Nashik district, Maharashtra. They reached the market at night and lined up in the truck queue.
The next day at 8.30 a.m., the onion auction that takes place daily for a couple of hours, began. The market committee staff came to their vehicle with a group of local traders, who form syndicates, and as per the farmers are the puppets of politicians controlling the market. They started the bid for the Kokine brothers’ produce at ₹150 per quintal, ending at ₹200 per quintal. Transport charges stand at ₹1,500, and the production cost of seeds, labour, insecticides, pesticides, and other expenditure for cultivating onions is between ₹800 and ₹1,000 in the area. The highest that traders buy the produce in the wholesale market for, is ₹500 per quintal. A new onion crop is cultivated every four months here, and losses go up to 85%.
Across the States of Maharashtra, Gujarat and Uttar Pradesh, the narrative is similar for onions and potatoes, a ubiquitous part of any Indian kitchen. Farmers say that debts are growing, with current prices in the wholesale market dipping. Untoward weather conditions, demonetisation in 2016, and finally the COVID-19 lockdowns for two years from 2020 that prevented produce from reaching towns and cities efficiently, have all led to debt. Farmers have been demanding immediate intervention of governments to address the crisis with permanent policies.
In Gujarat, where bumper yields — up to 15-20% over last season — have led to a price crash, some farmers have abandoned their harvested crop in the farms. “Farmers have no control over the selling price, which is determined by the market based on demand and supply. We also have no control over the ever-rising costs of labour, pesticides, irrigation, freight,” said Babubhai Mobh, 54, a farmer trying to get a good price at the Agricultural Produce Market Committee (APMC) campus at Mahuva in Gujarat. Locally called the yard, this is India’s largest onion trading centre for white onion and the second largest for red onion.
Maharashtra’s farmers in tears
The Kokine family have seen drought conditions every alternate year since 2015 and excessive rainfall in 2022. They had been hopeful when 2023 began. Farmers forced a halt in auctioning of onions at Lasalgaon, and they fear that like Marathwada, they will see many take their lives with the average debt at ₹5 lakh.
Farmers from Nashik are responsible for 30% of India’s onion production. They are demanding that the average price be increased to ₹2,500-₹3,000 per quintal. “Today, running a tea stall is more profitable than agriculture,” said Avinash Deshmukh, an onion grower from Nashik.
Maharashtra State Onion Growers’ Association president Bharat Dighole said the onion is a politically-sensitive crop. A party in power aims at keeping prices low. Questioning Prime Minister Narendra Modi’s promise of doubling farmers’ income by 2022, Mr. Dighole said, “Instead, expenditure, including prices of seeds, fertilizers, pesticides have doubled in the last couple of years; income has come down drastically.”
Earlier in February, Rajendra Tukaram Chavan, an onion grower from Borgaon in Solapur district, travelled 70 km to the APMC centre at the district headquarters and earned a net profit of ₹2.49 against the sale of 512 kg of onions to a trader. He got a cheque for ₹2.
Maharashtra’s former Deputy Chief Minister and Nationalist Congress Party legislator from Nashik district, Chhagan Bhujbal, questioned the Centre’s policy on onions. He said international traders complain that the Indian government arbitrarily imposes a ban on onion export, then lifts it. “We should export onions so that it benefits our farmers,” the 75-year-old MLA said.
Crashing prices sparked a big face-off in the State Assembly, forcing Chief Minister Eknath Shinde and Deputy Chief Minister Devendra Fadnavis to give an explanation. They said that the National Agricultural Cooperative Marketing Federation of India Limited (NAFED) had started procurement and the State government would support the farmers. However, farmers say this is not true.
Uttar Pradesh ordeal
Bhanu Pratap Singh has been a leader of farmers for more than five decades. In the past, he has taken up their issues even with Prime Ministers and Chief Ministers. Mr. Singh, who is also the national president of the Bharatiya Kisan Union (Bhanu), has seen a time when he cultivated potatoes in about 750 hectares of leased land in Firozabad district.
Everything changed in 2018. Mr. Singh’s 35-year-old son Om Pratap Singh, who was also a potato farmer and trader, took his life, as he failed to repay a debt. “The price of potatoes was so low in 2017, soon after demonetisation. We tried to repay loans by selling everything we owned. Several farmers in this locality killed themselves after the crisis in 2017. The BJP government promised loan waivers, but nothing happened,” the septuagenarian said.
Mr. Singh fears a repetition of 2017 in 2023. The price of potatoes is as low as ₹300 to ₹500 per quintal in about 25 districts of central and western Uttar Pradesh where potatoes are the main crop, with the chief harvest of the year in progress now. This year, he has sown potatoes in about 125 hectares of land. “My input cost is around ₹1,000 per quintal,” he said. A trader in Agra, Gajveeran Lal, said this price dip is because there is no demand this year. “During the harvest season, demand from States like Kerala and Tamil Nadu helped us to make such contracts.”
Uttar Pradesh is the largest potato-producing State in the country. The crop is cultivated in about 6.2 lakh hectares, according to data from the Indian Council of Agricultural Research. Sowing normally starts on October 20 and ends by November 10. A winter crop, potato needs cold conditions to grow, and farmers say changing weather conditions are also affecting production. This year, the beginning of winter was not as cold as the crop requires, compromising yield.
Prem Pal Singh has been cultivating potatoes for the last 50 years. In fact, it is the only crop he grows in about 25 hectares of land. “There are two issues. One, the price has decreased, and the yield has come down by 15% to 20%. Last year, the traders had a contract with farmers for ₹1,400 to ₹1,600 for a quintal. But this time, for the first time in my life, traders have not approached us. They are not ready to buy even for ₹700 for a quintal of good quality potatoes. The average cost is ₹1.5 lakh per acre that yields around 100 quintals,” he said, adding that 2020 was a very good year as some farmers got ₹2,000 per quintal of potato, which lured farmers into increasing acreage.
Because there are no traders buying, potatoes are getting pushed into cold storage. Manpreet Singh Keer is a large-scale farmer and owns a medium-sized cold storage with a few friends. Mr. Keer agrees that this is a crisis. “Cold storages are getting filled. The key issue is we do not have any value addition systems for potatoes [like a factory for processing them into products]. There have been several promises [by the government], but nothing materialised,” he said.
Cold storage owners also provide farmers with finance until their crop is sold. “We too have limitations for financing the farmers.” He said export to the West and the Arab nations is difficult because of the high pesticide content that does not conform with their import policies.
For the last five-six years, all the State’s 1,971 cold storage units have been running to full capacity. They have a collective capacity of 162.62 lakh tonnes. Rent was fixed as ₹135 per bag of about 50 kg. “Our demand was ₹140. Electricity charges have increased, making running the business difficult for us. Labour charges have also increased,” Mr. Keer said.
Rajveer Lawaniya, president of the Bharatiya Kisan Union’s Agra district unit, is a large potato farmer in his village. “The Taj brand of potatoes of the eight districts in and around Agra and Aligarh are famous. But there is a conspiracy to weaken potato farmers,” he said, explaining that the government and cold storage operators are pushing them to use cold storage facilities. He wants the Centre to facilitate export. “Potato should be traded in the [government’s] Multi Commodity Exchange,” Mr. Lawaniya added.
The Uttar Pradesh government, however, said the production and the prices are stable. Ravindra Kumar Tomar, director of the State Horticulture Department, said that the government will intervene if the price goes below ₹650 per quintal. “The rates are between ₹450 and ₹800 per quintal at the moment. Poor quality potatoes are being sold for ₹400 to ₹500. Good quality potatoes are getting between ₹700 and ₹800,” he said, adding that from 2018 to 2022, prices ranged from ₹800 to ₹1,500 for a quintal, while retail prices were between ₹15 and ₹30 per kilo.
“We are asking farmers to make use of Operation Greens scheme so that they can sell potatoes outside the State and the Centre will provide 50% subsidy for the cost of transportation. The benefit has now been claimed by traders, not by farmers,” he admitted.
Bhanu Pratap Singh said farmers should have the right to decide the price of their crops the way industrialists do for their products. “A Farmers’ Commission should immediately be formed. Buying below the price fixed by this commission must be made punishable,” he said.
— With inputs from Mahesh Langa
