Price volatility of agricultural commodities is a critical factor in incomes received by farmers and needs to be addressed to ensure cultivators a stable and adequate price. The present paper examines the price behavior of onion in selected centres of Karnataka and Maharashtra, the two largest onion producing States in the country. The findings show high variability in prices across months, centres, and years. There are clear price movements with high and low prices in alternate years across centres in both states. In particular, there was a huge price crash in all centres across seasons in 2016-17. The intra-year coefficient of variation was high in kharif and late kharif season which corresponds to the peak harvesting season in both the States. There is a mechanism of Market Intervention Scheme (MIS) for procuring perishable commodities including onion. The scheme was implemented in Karnataka during 2016 but the intervention did not assure a floor price for onion. There is clearly a need for intervention to lower price volatility.
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