The Retail Onion Market Under Pressure

Onion retail prices have shot up to Rs 65-70 per kg

India’s onion export rose by 56 percent to 12.29 lakh tonnes in April-July this year, but the country has now gone in for import of the kitchen staple as retail prices have shot up to Rs 65-70 per kg because of tight supplies. In value terms too, the onion export increased by 47.69 percent to Rs 1,443.09 crore in the period under review, from Rs 977.84 crore a year ago, it said.

The government allowed state-owned agencies like MMTC to import onion from countries like Egypt and China to increase availability and cool retail prices that have skyrocketed to Rs 65-70 a kg level in many parts of the country.

A decision in this regard was taken at a meeting of the Price Stabilisation Fund Management Committee, headed by Consumer Affairs Secretary Avinash K Srivastava.

“In the meeting, the decision was taken to import onions through government agencies to augment the availability of onions in the market and moderate prices,” Srivastava said in a statement.

According to data maintained by the Directorate General of Commercial Intelligence and Statistics (DGCIS), the country has exported 12.29 lakh tonnes of onion during April-July of 2017-18, up 56 percent from 7.88 lakh tonnes in the year-ago period. Exports increased during April-July firstly, there was no minimum export price (MEP) and second, the global prices remained much higher – owned National Horticultural Research and Development Foundation (NHRDF) acting Director P K Gupta told.

The exports helped farmers get better rates for their produce during the first quarter of the fiscal when local prices had fallen sharply. However, with old stocks getting depleted and rise in local prices, the exports have slowed.

For instance, in the national capital, the average retail price of onion was ruling at Rs 15 per kg in April and gradually rose to Rs 30-35 in July and by October-end; the rate crossed Rs 50, as per the ministry data.

However, local vendors are selling at Rs 65-70 per kg depending on the quality and locality in Delhi. A similar rise in prices of onion was witnessed in other cities also.

To boost local supply, the government facilitated import of onion through private traders, who have purchased 11,400 tonnes from the overseas market so far.

The new kharif crop is likely to be lower by 10 percent as the area was sown is less by 30 percent. The production assessment will be known once the harvesting completes, a senior consumer affairs ministry official said.

It may be noted that 40 percent of the country’s total onion crop is produced in the kharif season and the rest during the Rabi season. The Kharif crop, however, cannot be stored.

(Maharashtra, Karnataka, Madhya Pradesh, Bihar and Gujarat are major onion producing states. PTI LUX ABM)


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