Nashik: Onion Prices Crash Amid Middle East Conflict; Farmers Face Heavy Losses

Nashik: The ongoing tense situation in the Middle East has begun to directly impact India’s onion market, triggering a sharp decline in prices and causing concern among farmers. A significant drop in exports has led to increased domestic supply, pushing wholesale rates downward. At the Lasalgaon Agricultural Produce Market Committee, considered a benchmark for onion pricing in the country, onions are currently fetching an average price of ₹1,051 per quintal.

The instability in Gulf countries has reduced international demand, resulting in a steep fall in exports. Between April 2025 and January 2026, India exported 1.283 million metric tonnes of onions, generating revenue of ₹2,970 crore. However, the ongoing conflict-like situation has disrupted trade flows, leading to a surplus buildup in domestic markets.

As exports decline, onions meant for international markets are now flooding local mandis, disturbing the demand-supply balance and causing a sharp fall in wholesale prices. In several regions, prices have dropped below production costs, leading to heavy financial losses for farmers. Being a major cash crop, the price crash has disrupted the broader economic cycle linked to onion cultivation and trade.

HPEA Vice President Vikas Singh stressed the urgent need for measures to support exporters and protect farmers. He suggested that the central government should stabilise export policies, increase export incentives, provide at least a 7% transport subsidy, develop modern storage facilities, and strengthen port and logistics infrastructure.

While retail prices remain relatively stable, the steep decline in wholesale prices continues to be a major concern. Weak domestic demand, along with reduced bulk purchasing, has further added to the pressure on prices.

Key reasons for the price crash include export disruption due to the Middle East conflict, excess supply in the domestic market, and challenges in transportation and international trade.

The decline in exports has led to a rise in domestic stock, as onions originally meant for Gulf countries are now being sold locally. This has significantly increased supply, upsetting market equilibrium and leading to falling prices. Wholesale markets have witnessed a sharp drop, with rates in many areas slipping below production costs.

Farmers are facing mounting distress as they struggle to recover even their basic input costs. Many are compelled to sell produce at minimal rates, worsening their financial condition. If the situation persists, losses are expected to deepen further.

Experts have called for immediate government intervention, including export incentives, market support through procurement, and direct financial assistance to stabilise prices and safeguard farmers’ livelihoods.

Onion Export Statistics (India)

| Year               | Quantity (Lakh Tons) | Foreign Exchange (₹ Crore) |
| ------------------ | -------------------- | -------------------------- |
| 2018-19            | 21.83                | 3468                       |
| 2019-20            | 11.49                | 2340                       |
| 2020-21            | 15.77                | 2826                       |
| 2021-22            | 15.37                | 3432                       |
| 2022-23            | 25.25                | 4522                       |
| 2023-24            | 17.17                | 3922                       |
| 2024-25            | 11.47                | 3822                       |
| 2025-26 (till Jan) | 12.83                | 2970                       |

The sharp fall in onion prices, particularly in key markets like Nashik, has raised serious concerns, with stakeholders urging swift action to stabilise the sector.