GROWTH PERFORMANCE AND PRICE BEHAVIOUR OF ONION IN MAJOR STATES OF INDIA 3365
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Date
2021-09
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JAU JUNAGADH
Abstract
Onion, growth rate, instability, contribution, price behavior
Onion is one of the important vegetable crop widely used in all households all
the year round in India and throughout world. It is commonly known as “Queen of the
kitchen” due to its highly valued flavour, aroma, and unique taste, and the medicinal
properties of its flavour compounds. Onion is an important commercial crop earning
sizable foreign currencies and it has received greater attention because of extreme
price volatility. Keeping in view of this potentialities, the present study, “Growth
performance and price behaviour of onion in major states of India” was undertaken
with the main objectives to assess the growth dimensions, instability, sources of
growth, price variability and interrelation among the major markets in India.
The secondary data on area, production and productivity of onion in seven
major producing states of India were collected for the period from 1990-91 to
2019-20. Besides, nine wholesale market prices of onion, one each from major states,
representing consumption and two major producing locations markets were also
collected for the period from 2001-02 to 2019-20 from various public sources. The
data was analyzed using techniques of compound growth rate, linear and quadratic
trends, Cuddy Della Valle index, decomposition analysis, seasonal and irregular
variations, and inter-relationship by correlations co-efficient and co-integration
analysis.
The investigation revealed that, among the major onion growing states,
Madhya Pradesh recorded the highest increase in onion area about 9.23 per cent per
annum followed by Maharashtra (8.04%), Rajasthan (6.31%) during 1990-91 to
2019-20. Madhya Pradesh also registered significantly the highest growth rate of
onion production about 12.69 per cent per annum, while Bihar registered significantly
the highest growth rate of productivity about 4.59 per cent per annum. During 2000s,
significantly the highest increase in area (19.89%) and production (20.96) of onion
was reported in Gujarat. At all India level shown significantly positive growth in
onion area (5.89%), production (8.33) and yield (2.30) during overall period.
At country level as well as in all the major states, the yield effect was found
as the main component of production growth followed by area and interaction effects.
Rajasthan noticed the highest instability in onion area (39.27%), Madhya Pradesh
production (52.33%) and Karnataka in yield (40.93%).
The co-efficient of quadratic trend (T2
) found non-significant in all markets
noticed that there was no change in growth pattern of onion price in last two decades,
which indicates that farmers were not benefited by rise in price, it is the effect of
inflation factors only. On an average the onion prices in major markets of India was
increased annually at the rate of 8.50 per cent during last two decades.
The seasonal indices indicated the minimum onion price in the months of
April-May and the maximum in the months of October-November in most of the
markets, besides revealed high seasonal and irregular fluctuations. The monthly
(>0.87) and yearly (>0.90) onion prices were found highly correlated among all the
markets. The Augmented Dickey-Fuller (ADF) unit root test for onion showed the
data are level stationary I (0). Moreover, all he onion markets were shown spatially
integrated, that is there is a co-movement in prices across markets in long run and the
short-run disequilibrium was found existing, but it found get corrected at larger speed.
Most of the markets found bidirectional influence on prices.
This study suggest that there is large scope for achieving higher production of
onion in India, development of irrigations facilities and proper agronomical practices
to stabilize onion acreage. As onion price are highly volatile, the Government should
take immediate action to enhance export, when price falls drastically and allow the
import, when price increase beyond certain level.