Chitradurga: Onion prices in Bangalore city range between Rs 25 and Rs 35 a kg or Rs 2500 to Rs 3500 per quintal, while 200 kms away in the hub of onion production, Central Karnataka prices range from Rs 1 to Rs 2 per kg or Rs 100 to Rs 150 per quintal
Astounding but true; Farmers in central Karnataka, (Chitradurga, Davangere, Haveri, Gadag) are dumping their onion produce in the market as rates have collapsed to around Rs 100-150 per quintal (100 kg).
But in Bangalore city, which is a mere 200 km away from Chitradurga, the prices of onion continues to reign at Rs 2,500 to Rs 3,500 per quintal.
Bangalore consumes around 300 tonnes of onions a day. The city has been receiving nearly two lakh bags of onions per day (one bag = 50 kg) from north Karnataka. This will amount to nearly 10,000 tonnes. Most of it goes to other states, including Tamil Nadu, Andhra Pradesh, and as far away as West Bengal. Some of it even enters Bangladesh too. The best quality onions are picked up by exporters.
As usual, the state government has constituted a committee to find out why prices have fallen in north Karnataka. Bangaloreans, however, have tears in their eyes as they envy their neighbors.
Agro-economist T N Prakash Kammaradi, chairman of the Karnataka Agriculture Price Commission, said the reason is because onion market in the state is a “classic example of an imperfect market”.
Kammaradi said it will take time for the onion market in Karnataka to become ‘perfect’ like that of copra. He said, “If the price is Rs 1 in Chitradurga, we expect it be Rs 4-5 in Bangalore. But that is not happening. The first problem is lack of information on pricing. The buyers’ market is not competitive enough. This brings the second problem of the market being monopolised by a few. The third problem is usually transport bottlenecks. But in this case, transportation from Chitradurga to Bangalore is not difficult. Unless there are hundreds of competitive buyers we cannot hope for the prices in Bangalore to reflect the prices in Chitradurga.”
