Eco Case Study

HEC049
Volume 11
Issue 2
June 2013
India Shedding Tears over Onion Prices

Case prepared by Veena KESHAV PAILWAR 1, 2
In the upscale restaurants of Delhi and Mumbai, Chefs are eschewing the
onion, saying the price hike is eating up as much as 15 per cent of profits.
… Mahendra Khairiya, chef at the upscale Kothi Mem restaurant in Delhi,
raised eyebrows across the city by announcing pumpkin puree would
replace onion gravy on his menu. Onion pickles have been scrapped
entirely.
– Stephanie Nolen, 2011
Lasalgaon is angry. …over 50 farmers … began hurling abuse at the media
for making their lives miserable.
“You people are responsible for this situation. Where were you when onion
prices were 500 per quintal? Nobody talked of prices when we were
struggling to recover our costs,” they shouted in a mix of Marathi and
Hindi. “Everyone is talking of high prices but no one wants to mention that
we have lost over half the crop and even at these high prices we will not
make money,” another farmer politely told us.
– M. Madhavan, 2011
With onion prices spiraling to 70-80 a kg, Prime Minister Manmohan
Singh Tuesday demanded immediate action to deal with the crisis, but
Agriculture Minister Sharad Pawar warned it would take two three weeks
for the prices to fall…
The Bharatiya Janata Party attributed the rising price to the “wrong
economic policies and bad governance…”
Pawar blamed the crisis on heavy rains which he said had destroyed crops,
particularly in Maharashtra…
– SME Times News Bureau, 2010
1 Veena Keshav Pailwar is Professor of Economics at the Institute of Management Technology, Nagpur, India.
2 The author is thankful to Ms. Tinu Agrawal, Mr. Sankalp Negi, Mr. Shailender Chauhan and Mr. Rishi Saluja for useful
comments on the case and the associated teaching notes.
© HEC Montréal 2013
All rights reserved for all countries. Any translation or alteration in any form whatsoever is prohibited.
The International Journal of Case Studies in Management is published on-line (www.hec.ca/en/case_centre/ijcsm),ISSN 1911-2599.
This case is intended to be used as the framework for an educational discussion and does not imply any judgement on the
administrative situation presented. Deposited under number 9 80 2013 001 with the HEC Montréal Case Centre, 3000, chemin de
la Côte-Sainte-Catherine, Montréal (Québec) Canada H3T 2A7.
This document is authorized for use only in DR. ANCHAL ARORA's ET - 18.7.23 at Indian Institute of Foreign Trade from Jul 2023 to Jan 2024.
Hue and Cry over Onion Prices

During the period of December 2010 to January 2011, it seemed as if all of India was shedding
tears over onion prices, which had suddenly registered a sharp rise. The average price, which was
running around Rs 30 in the first week of December 2010, had shot to above Rs 50 by the fourth
week of December. Some centres even recorded a much higher price, with a peak of around
Rs 85 in Gurgaon (Exhibit 1), a city in Haryana state in India. Consumers across all income strata
reduced their onion consumption. For some, in spite of a reduction in their consumption, the
expenditure on onions almost doubled. Even restaurant owners substituted onions with shredded
cabbage, carrots and pumpkin in their dishes. There was a hue and cry over the onion prices
across the country, with consumer forums blaming the government for not taking action to curb
onion prices. The opposition parties in the parliament also blamed the government for pursuing
the wrong economic policies. The government suspected hoarding by the traders to be the main
culprit behind the soaring prices and warned them to release onions from their stocks. It imposed
a ceiling on stock holding and issued a search order. The traders argued, on the contrary, that a
natural supply-demand gap was the main reason for the soaring prices. There was total chaos,
with all the stakeholders blaming each other for the situation and with no clear explanation of
what was wrong. Was the shortage due to a natural supply shock? Was it a result of an artificially
created shortage? Was it an outcome of wrong government policies? Or was it simply the result
of changes in demand conditions? The government and business analysts were wondering not
only about the causes of the sharp price rise, but also about the appropriate interventions and
policy changes required to stabilize the prices.
Onion Prices
Supply side of the market
India is the second largest producer of onions in the world (Table 1). Maharashtra state is the
largest producer of onions in the country, accounting for 41% of the area harvested and 38% of
production (Table 2). Within Maharashtra, Nashik district contributes 35 to 40% of the state’s
production. Lasalgaon in Nashik is the biggest onion market in the country; hence, this market
largely determines the prices in the country. The other major onion-producing states are
Karnataka, Gujarat, Bihar, Madhya Pradesh and Rajasthan.
Table 1: Onion Production, Area and Yield: Top 10 Countries in the World in 2009
Country Production (tonnes) Area Harvested (ha) Yield (hg/ha)
China 21,046,969 947,611 222,106
India 13,900,000 846,909 164,126
USA 3,400,560 60,120 565,629
Turkey 1,849,580 65,000 284,551
Egypt 1,800,000 54,000 333,333
Pakistan 1,704,100 129,600 131,489
Russian Federation 1,601,550 85,700 186,879
Iran (Islamic Republic of) 1,512,150 47,450 318,683
© HEC Montréal 2
Country Production (tonnes) Area Harvested (ha) Yield (hg/ha)

Brazil 1,511,850 66,013 229,023
Netherlands 1,269,000 26,000 488,077
Spain 1,263,400 23,600 535,339
Source: FAO. FAOSTAT-Agriculture, as on 23/9/2011 (http://faostat.fao.org/site/567/default.aspx#ancor)
Table 2: State-Wise Area and Production Data for Onions in 2011-12

State Area Production Yield Share in Total Production
(‘000 ha) (‘000 MT) (Ton/ha) %
Andhra Pradesh 54.9 732.3 13.3 4.84
Bihar 54.4 1,138.50 20.9 7.52
Gujarat 57.3 1,394.60 24.3 9.21
Haryana 23.2 476.5 20.5 3.15
Jharkhand 17.2 364.1 21.2 2.41
Karnataka 130 1,756.70 13.6 11.61
Madhya Pradesh 64.1 985.1 15.4 6.51
Maharashtra 387 5,823.50 15.1 38.48
Others 17 340 20 2.25
Rajasthan 48.6 900 18.5 5.95
Tamil Nadu 37 556.5 15 3.68
Uttar Pradesh 23.6 370.8 15.7 2.45
West Bengal 21.2 297 14 1.96
Total 935 15,135.60 100.00
Source: National Horticulture Research and Development Foundation, Database, as on 25/9/2011
(http://www.nhrdf.com/ContentPage.asp?DataCode=202)
There are three main seasons for onion production: kharif (monsoon), late kharif and rabi (winter)
(Table 3). The rabi crop is the major crop, contributing 70% of total onion production. Some of
the rabi varieties have excellent storage quality of about four to six months.
Table 3: Onion Seasons in India

States/Regions Seasons Time of Time of Time of
Sowing Transplanting Harvesting
Maharashtra and 1.Kharif May-June July-Aug. Sept.-Dec.
some parts of Gujarat 2.Early Rabi Aug.-Sept. Sept.-Oct. Jan.-March
3.Rabi Oct.-Nov. Dec.-Jan April-May
Tamilnadu/Karnataka 1.Early Kharif March-April April-May July-Aug.
and AP 2.Kharif May-June July-Aug. Oct.-Nov.
3.Rabi Sept.-Oct. Nov.-Dec. March-April
Rajasthan/Haryana/Pu 1.Kharif May-June July-Aug. Nov.-Dec.
njab/UP and Bihar 2.Rabi Oct.-Nov. Dec.-Jan. May-June
West Bengal & Orissa 1.Kharif June-July Aug.-Sept. Nov.-Dec.
2.Late Kharif Aug.-Sept. Oct.-Dec. Feb.-March
Hills 1.Rabi Sept.-Oct. Oct.-Nov. June-July
2. Summer (long day type) Nov.-Dec. Feb.-March Aug.-Oct.
Source: National Horticulture Research and Development Foundation (2011), Database, as on 25/9/2011
(http://www.nhrdf.com/ContentPage.asp?DataCode=202).
© HEC Montréal 3
Onions are a commercial crop. The estimated cost of onion cultivation varies from Rs 79,590 per
ha to Rs 87,900 per ha (Table 4) (for the international equivalence of Indian units of
measurement, see Exhibit 2), which is comparatively smaller than the cost of cultivating other
crops. Apart from the suitability of soil for onion production, the lower cost of cultivation also
attracts many small and medium farmers to this crop.
Table 4: Cost of Production of Onions During 2011-12 in Maharashtra (Cost Rs/ha)

Operations Kharif Late Kharif Rabi
1. Land 10000 10000 10000
2. Seed Cost 4800 4800 4800
3. Nursery Raising 3500 3500 3500
4. Land Preparation 7000 7000 7000
5. Transplanting 8000 8000 8000
6. Irrigation 4000 4000 4000
7. Manures and 16000 17500 17500
Fertilisers
8. Weeding and 6000 6000 6000
Hoeing
9. Plant Protection 4000 4000 4000
10. Harvesting, Curing, 7000 8000 8500
Sorting, Grading
and Packing
11. Transportation 3000 3500 4000
12. Supervisory Charges 1500 1500 1500
13. Overhead Charges 1000 1000 1000
14. Total (Rs) 75800 80800 83800
15. Bank interest @ 3790 4040 4190
10% p.a. for 6
months
16. Total cost (Rs) 79590 84840 87990
17. Average Yield 160 245 250
(Quintal)
18. Cost per Quintal 497 346 352
(Rs)
Source: National Horticulture Research and Development Foundation (2012), Market Intelligence System: Baseline
Data for Potato and Onions, April,
(http://www.sfacindia.com/Docs/Onion%20&%20Potato%20Baseline%20Report.pdf)
In spite of India being a major producer of onions, its productivity is one of the lowest amongst
the major growing countries. Apart from lower yield, the crop is also subject to excessive post-
harvest storage losses in the event of adverse weather conditions, lack of dormancy (inactive
state) in bulbs, and pest and disease infestation, which affect the economic viability of the crop.
© HEC Montréal 4
Storage of onions and supply
Unlike wheat, rice and other food grains, onions are a highly perishable commodity; hence, they
cannot be stored for long periods. Also, the storability of onions depends on their variety and the
harvesting period. Kharif crops cannot be stored for more than a month, whereas rabi crops can
be stored for four to six months. However, conventional methods of onion storage can result in
large losses, even in rabi crops, due to weight loss, sprouting and rotting of bulbs. To overcome
these losses, the country requires scientifically constructed cold storage facilities, which, as per
the Maharashtra State Agricultural Marketing Board (online), can cost around Rs 6,000/- per mt
storage capacity (excluding the cost of land). The country requires an additional storage capacity
of around 12 lakh tonnes and modernization of 8 lakh tonnes capacity of existing units (National
Bank for Agriculture and Rural Development, 2000).
Because of the lack of proper storage facilities, most farmers bring onions directly to the market
and unload their entire stock within a month of harvest. As a consequence of the glut in the
market, the prices are very low in the months of April and May (Figure 1), which adversely
affects the earnings of farmers. Wholesale traders store onions, but in a traditional and
unscientific manner; hence, the supply becomes limited in the subsequent months and prices rise
rapidly and steeply, leading to dissatisfaction among consumers as well as farmers. Consumers
feel the pinch of the high prices because they are accustomed to using the bulbs on a daily basis,
whereas the farmers’ agony is due to poor yield, lack of storage facilities and low prices.
Sometimes, they are not able to recover even the cost of cultivation. In the absence of proper
storage facilities, prices fluctuate widely, which creates uncertainty in the environment and
hampers cultivation decisions in the ensuing onion-growing season.
Figure 1: Month-Wise Market Arrivals and Prices (in Rs) of Onions for All Months in
Lasalgaon (Nashik) in Maharashtra
Source: Based on the data available from National Horticulture Research and Development Foundation, Database, as
on 25/09/2011 (http://www.nhrdf.com/ContentPage.asp?ResultCode=301)
Demand side of the market
Except for a few communities, onions are used in the day-to-day cooking of both the poor and the
rich across the country. Apart from households, restaurants are also major users of this bulb. It is
used not only raw, but also in processed form – fried, boiled, baked, dried and powdered as well
as in curries, soups and pickles.
© HEC Montréal 5
Onions also have numerous health benefits and healing properties and are widely used in the
manufacture of medicines for dropsy, kidney, heart, liver, diabetes, tuberculosis, colic, scurvy,
rheumatic pain and other inflammatory diseases.
However, most Indians use onions not because of their inherent health benefits, but because they
are a condiment that adds taste to the food to which they are accustomed. Also, onions are usually
plentiful and inexpensive, even poor people can normally afford them. Though some consumers
substitute onions with grated cabbage or pumpkin puree during periods of scarcity, there are not
many close substitutes for onions. A small change in the price, therefore, does not have a large
effect on the quantity demand. Considered to be almost an essential item, it takes a very big
change in the price to affect the consumption of onions.
Government policies and regulation of the onion market
In India, in general, the government regulates food grains and vegetable markets by fixing
minimum support prices, minimum export prices, tariffs on imports and quantitative restrictions.
As far as the onion market is concerned, the government pursues the following policies:
• First, the government provides the minimum support price to farmers to augment the
production and supply of various agricultural products, and to support their income.
However, as onions cannot be stored for long periods and their storage requires a special
type of structure and huge area, it is not possible for the government to purchase, store
and market onions. Therefore, the government does not provide support prices for onions.
The lack of storage facilities results in large fluctuations in the market price of onions.
• Second, the government regulates the export of onions by fixing the minimum export
price. India is a major producer of onions; hence, supply from India can influence world
onion prices. In a situation of normal supply, onions are available at a cheap price. If
exported at this price in the world market, they are not very remunerative for Indian
farmers. Therefore, the idea behind fixing the minimum export price is to provide
lucrative prices to the farmers, to encourage the export of onions and to maximize foreign
exchange earnings for the country. Keeping these objectives in mind, in a normal supply
situation, the minimum export price is fixed above the market clearing price in the
domestic market, but below that prevailing in the world market. The minimum export
price, however, affects the supply in the domestic market. An increase in export prices
(above the world market price) makes the exports more expensive in the international
market, thus reducing demand for exported onions in the global market. However, this
helps increase the supply in the domestic market. The reverse holds true when the
minimum export price is lowered. To ensure a smooth domestic supply and to moderate
fluctuations in domestic onion prices, the minimum export price is fine-tuned every
month, taking into account quality, crop prospects, market trends, expenses involved,
freight charges, etc.
• Third, India is a major producer of onions in the world. To prevent a glut in the market
and to ensure fair prices to onion farmers, the government tries to restrict the import of
onions by imposing an import duty.
© HEC Montréal 6
• Fourth, in extreme situations, the government can impose quantitative restrictions and
even completely ban the export and import of onions.
• Fifth, in India, the inter-state sale of agricultural products, including onions, is restricted
by various state-level regulations and taxes to ensure food security in the exporting states
and to avoid excessive competition in the importing states. Such restrictions, in spite of
the removal of a ban on the inter-state movement of agricultural commodities, fragment
the markets, result in black marketing and hoarding, boost the commission of middlemen
and make prices highly volatile.
What Caused Soaring Onion Prices?

In general, the overall price level in India hovers around Rs 15 per kg. However, the country also
experiences seasonal fluctuations in prices. Onion prices generally run high in the lean months of
December-January and dip sharply in April and May with the arrival of the rabi crop. But the
period of December 2010 to January 2011 saw an unprecedented rise in the wholesale and retail
prices, which were much higher than those registered in the same period in 2009-10 (Figures 1
and 2).
Was it a supply shock?
Various natural factors affected the kharif crop adversely in Maharashtra, which is the major
onion-growing region in the country. Fungal diseases like purple anthracnose and purple blotch
affected the kharif onion sapling (John, 2011). The situation further deteriorated with an erratic
and extended monsoon, which caused waterlogging in the flat crop beds and spread the fungal
infections among the saplings rapidly. The heavy downpours and prolonged humid climate also
made the spraying of pesticides ineffective. The untimely heavy showers in southern India also
affected the onion crop in Karnataka and Tamil Nadu states. As per one estimate, overall, 40% of
the crop was damaged (Madhavan, 2011).
The impact of natural factors on supply could have been mitigated, however, had there been
sufficient onion reserves available in the country. But since it was lacking proper storage
facilities, the country did not have enough of the durable rabi crop in storage. Whatever stocks
the states reported were primarily from the kharif crop, which was not sufficient to meet even
normal demand levels.
Was it a demand shock?
Some analysts argue that India is one of the world’s fastest growing countries, with an average
GDP growth rate of 8 to 9%. Improvements in income levels have been causing changes in
dietary habits in favour of protein-rich foods, fruits, vegetables, pulses, milk, etc. (Chand et al.,
2011). Dietary changes, along with population growth, have led to increased consumption of
various agricultural products, including onions, and have caused continuous price increases.
Apart from the overall increasing trend in the demand for onions, there was also a seasonal
increase in demand, which caused a sharp spike in onion prices. December-January is wedding
© HEC Montréal 7
season in India. Major festivals, such as Christmas, New Year’s Eve, Makar Sankranti, etc., fall
in these months. Families and friends visit each other during these festivities in India and
celebrate the events with special meals, increasing the demand for onions and other vegetables
during this period.
Was it speculation?
Traders did take advantage of the apparent mismatch of demand and supply. The demand-supply
gap, which would have been minor, was widened by speculative activities and hoarding by
intermediaries. The widening of the gap accentuated the deviation between wholesale and retail
prices (Figure 2) and worsened the situation manifold in the market place.
Figure 2: Wholesale and Retail Onion Prices (in Rs) in December 2009 and 2010
Source: Based on the data available from the Ministry of Consumer Affairs, Food and Public Distribution, Price
Monitoring Cell, 2011, http://fcainfoweb.nic.in/Prices_Application/daily_prices/san_interface_daily.asp.
Expectations also played an important role on the demand front. In anticipation of a further rise in
the price of onions, consumers also tried to safeguard their interest by demanding more onions
than their normal requirement and storing them. Those families that usually used only 2 kg of
onions in a month bought 5 kg in anticipation of additional increases in onion prices, further
accentuating the shortage of onions in the market.
Was it government policy?
The opposition parties as well as analysts blamed the supply shortage on the government’s
economic policies. They argued that, in its zeal to promote onion exports (India is the largest
exporter (Table 5)), the government had ignored the rising domestic demand. India used to export
just 106 thousand tonnes of onions 50 years ago. With the emergence of the WTO in 1995, and
after the removal of quantitative restrictions, the export of onions increased rapidly, reaching
1,670 thousand tonnes in 2008 (Figure 3), which accounted for around 12% of total production.
© HEC Montréal 8
Table 5: Onion Exports: Quantity and Value: Top 10 Exporters in the World in 2008
Countries Quantity Countries Value ($)
India 1670720 India 422832
Netherlands 1100050 Netherlands 375646
China 545310 Mexico 301007
United States of America 320773 United States of America 182507
Mexico 279989 China 133026
Spain 254773 Spain 96878
Turkey 210936 Argentina 77502
Argentina 202597 Poland 66706
Poland 141672 Egypt 41559
Egypt 103321 Italy 40749
Source: FAO, FAOSTAT-TradeSTAT, as on 24/9/2011 (http://faostat.fao.org/site/535/default.aspx#ancor)
Figure 3: Trend in Export of Onions
Source: Based on the data available from FAO (2011), FAOSTAT-Agriculture, as on 24/9/2011,
http://faostat.fao.org/site/342/default.aspx.
Apart from the removal of quantitative restrictions, the policy on minimum export prices had
promoted export value and volume. The minimum support prices had usually been kept low in
comparison to international prices to make Indian exports competitive and enhance the demand
for exported onions. However, since these prices were higher than those in the domestic market,
the effect of this policy had been to reduce the supply of onions in the domestic market.
The government was also criticized for delayed policy responses. The outbreak of the fatal crop
diseases was reported in the kharif season and it was expected that the yield would be low and
prices would soar. Anticipating this, the minimum export prices should have been sharply
increased as soon as it became apparent that there would be a supply shortage. But the
government response on this front was very late in coming. Critics of the government’s policy
argued that the government could have averted the sharp supply shortage by restricting exports
and resorting to imports at a much earlier stage and by building up buffer stocks on the bumper
rabi crop (Mehta, 2011 and John, 2011).
© HEC Montréal 9
Government Management of the Crisis and Its Impact

To the extent that they are part of even the poorest person’s meal, onions have played an
important role in Indian politics. Hence, a sharp rise in onion prices is considered to be a
politically sensitive issue. The Indian national election of 1980 and state elections in Delhi and
Rajasthan in 1998 came to be known as “onion elections” (Kumar, 2011) because the runaway
onion prices in those years brought down the government in power at the time.
The soaring onion prices, which were reducing home cooks and restaurateurs alike to tears and
threatening to fuel public ire over runaway food prices, compelled the government to respond
forcefully by implementing various measures on December 21, 2010. The immediate response of
the government was to discourage exports by asking the National Agricultural Cooperative
Marketing Federation (NAFED), responsible for marketing (including exports and imports) of
agricultural products for the benefit of farmers in the country, and other agencies to “voluntarily”
suspend onion exports. The government also more than doubled the minimum export prices to
$1,200 a ton from $500 a ton, making onions more expensive in the international market and thus
discouraging exports. The government also attempted to augment supply by eliminating the
import duty on onions, which was 5% at that time, and by importing shipments of onions from
neighbouring Pakistan.
However, the prices ruled steady. Finally, to bring prices down to a desirable level, the
government intervened directly in the market by making the NAFED supply onions at the price
of Rs 35, far below the market prices at the time. However, the huge demand persisted at this
price and the government ended up rationing onions by limiting the supply to 2 kg per person at
the time of distribution by the NAFED.
As the supply of onions at this price was below the cost of procurement, the government agreed
to compensate the NAFED for 30% of the losses it was estimated to have incurred by selling
onions at a cheaper rate (PTI, 2011), implying an increasing burden on taxpayers. The
government released Rs 15 crore to NAFED to subsidize onions and to help tide over the capital
city of Delhi during the crisis (Bhatnagar, 2011).
What Is Needed?
Business analysts questioned whether the government should leave the matter of export and
domestic price fluctuations to the natural forces of demand and supply, and intervene in the
market only in the event of large volatility, by subsidizing onions to consumers. Would the
traders and farmers benefit from such a policy? Or, should the government scale up storage
facilities by investing heavily in infrastructure to provide long-run price stability? Such an
approach would, however, drive up the government’s already high deficit, the burden of which
would fall on everyone, including consumers, traders and farmers, in the form of higher inflation.
2013-06-18
© HEC Montréal 10
Exhibit 1
Map of India
Source: http://www.mapsofindia.com/maps/cities/india-map-with-cities.html
© HEC Montréal 11
Exhibit 2
Indian Units of Measurement and their Equivalence
Indian Units International Equivalent

1 lakh 100 thousand
10 lakh 1 million
1 crore 10 million
10 crore 100 million
100 crore 1 billion
1 Acre 4,840 sq yard
= 4,046.8 sq meters
= 43,560 sq feet
= 0.4047 hectare
= 20 kanal
1 hectare (h) 2.4711 acre
= 10,000 sq metre
1 kilogram (kg) 2.20462262185 lb
1 metric ton (mt) 1,000,000 gms
=1.102 short tons
Hectogram (hg) 0.1 kg
© HEC Montréal 12
Bibliography
BARAKADE, A.J. (2011). “Economics of Rabi Onion Marketing in Satara District: Problems
and Prospects,” India Streams Research Journal, Vol. 1, No. 9, pp. 1-4,
http://www.isrj.net/Sep/2011/Sep/Barakede.pdf.
BHATNAGAR, Gaurav Vivek (2011). “Government Subsidy for Onions,” The Hindu, January 8,
http://www.thehindu.com/todays-paper/tp-national/tp-newdelhi/article1064649.ece.
CHAND, Ramesh, P. SHINOJ, Ashok GULATI and Kavery GANGULY (2011). “Managing
Food Inflation in India: Reforms and Policy Options,” ICAR Policy Brief, February,
http://www.ncap.res.in/upload_files/policy_brief/pb35.pdf.
JOHN, Ann Mary (2011). “The Onion Price Rise: What Actually Made Us Cry?” Macroscan: An
Alternative Economics Webcentre, 21 February,
http://www.macroscan.org/cur/feb11/cur210211Onion_Price.htm.
KUMAR, Devesh (2011). “Food Manifesto: Food & Electoral Battles,” The Economics Times,
July 21, http://economictimes.indiatimes.com/features/economy/food-manifesto-food-
electoral-battles/articleshow/7344935.cms.
MADHAVAN, M. (2011). “Why is Lasalgaon Angry?” Business Today, January 19,
http://businesstoday,intoday.in/storyprint/12551.
MAHARASHTRA STATE AGRICULTURAL MARKETING BOARD, as on November 6,
2011, http://www.msamb.com/english/schemes/onionstorage.htm.
MEHTA, Pradeep (2011). “Learning from the Onion Crisis,” The Financial Express, February
17, http://www.financialexpress.com/news/learning-from-the-onion-crisis/750971/.
NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT (2000). “Capital
Investment Subsidy Scheme for Construction/Expansion/Modernization of Cold Storage
and Storage for Horticulture Produce,” Circular No. 16/99-2000, January 5,
http://www.nabard.org/pdf/circular-Cold%20storage.pdf.
NATIONAL HORTICULTURE RESEARCH AND DEVELOPMENT FOUNDATION (2011).
Database, http://www.nhrdf.com/ContentPage.asp?DataCode=202, as on 25/9/11.
NATIONAL HORTICULTURE RESEARCH AND DEVELOPMENT FOUNDATION (2012).
Database Market Intelligence System: Baseline Data for Potato and Onions, April,
http://www.sfacindia.com/Docs/Onion%20&%20Potato%20Baseline%20Report.pdf.
NOLEN, Stephanie (2011). “India in a Stew over Onion Shortage,” The Globe and Mail,
January 31, http://m.theglobeandmail.com/news/world/asia-pacific/india-in-a-stew-over-
onion-shortage/article1878002/?service=mobile.
PRESS TRUST OF INDIA (2011). “Subsidised Nafed Onions Selling like Hot Cakes in Delhi,”
Business Today, January 14, http://businesstoday.intoday.in/story/subsidised-nafed-
onions-selling-like-hot-cakes-in-delhi/1/12404.html.
SAMRA, J.S. et al. (2006). “Impact of Excess Rains on Yield, Market Availability and Prices of
Onion,” Information Bulletin, Hyderabad: Central Research Institute for Dryland
Agriculture (ICAR), http://www.crida.ernet.in/Bulletins/onion%20bulletin.pdf.
© HEC Montréal 13
SME TIMES NEWS BUREAU (2010). “PM Steps in as Onion Prices Spiral,” December 22,
http://smetimes.tradeindia.com/smetimes/news/indian-economy-news/2010/Dec/22/pm-
steps-in-as-onion-prices-spiral50251.html.
© HEC Montréal 14

Eco Case Study

Uploaded by

Copyright:

Available Formats

You might also like

Eco Case Study

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Eco Case Study

Uploaded by

Copyright:

Available Formats

HEC049

India Shedding Tears over Onion Prices

Hue and Cry over Onion Prices

Country Production (tonnes) Area Harvested (ha) Yield (hg/ha)

Table 2: State-Wise Area and Production Data for Onions in 2011-12

Table 3: Onion Seasons in India

Table 4: Cost of Production of Onions During 2011-12 in Maharashtra (Cost Rs/ha)

Storage of onions and supply

Demand side of the market

Government policies and regulation of the onion market

What Caused Soaring Onion Prices?

Was it a supply shock?

Was it a demand shock?

Was it government policy?

Figure 3: Trend in Export of Onions

Government Management of the Crisis and Its Impact

Indian Units International Equivalent

You might also like