The central government is facing challenges in achieving its procurement target of 5 lakh tonnes of onions as market prices are higher than the prices offered by the government agencies.
The central government’s decision to create the buffer was announced in April.
Nafed and the National Co-operative Consumer Federation (NCCF) are the two nodal central agencies responsible for procuring onions for the central pool.
It is not a price support operation but a price stabilisation exercise under the Price Stabilisation Fund. The government is keen on building a strategic reserve of onions as the production of rabi onions in the country is expected to be lower by over 10%.
“A high-level team of Nafed made a surprise visit to some of the procurement centres in Nashik district on Friday, where they found many irregularities,” said an office bearer of an APMC in Nashik district requesting not to be identified.”There are large scale irregularities taking place at the procurement centres run by Nafed. The FPOs, who were carrying out the procurement operations on behalf of Nafed and NCCF, were supposed to buy onions from farmers. However, it has been found that they had bought onions from traders when prices were lower. Now that the Nafed has increased its offer price, instead of buying onions from farmers, these FPOs are presenting their cheaply bought stored onions as purchases made for Nafed,” alleged Bharat Dighole, president, Maharashtra Onion Growers’ Association (MOGA).His association has appealed to Nafed to stop their procurement operations till the investigations into alleged irregularities are completed.
Although the peak arrival period of onions is over, government agencies have not been able to buy even 1 lakh tonnes of onions so far. Delay in start of procurement and offering rates lower than the prevailing market prices are the key reasons for the sluggish pace of buffer creation, said trade insiders.
The central government has now changed the dynamic price fixing mechanism to attract more farmers to the government centres. Instead of fixing one uniform weekly price for all markets in the state, it has now started fixing different prices for different markets. The offer price of Nafed has increased from around Rs 22/kg two weeks ago to Rs 25-29/kg for different markets.
Despite the increase in Nafed’s onion price, the MOGA has appealed to onion growers to not sell onions to Nafed/NCCF as the market prices are still higher than the government prices.
