Dine-outs to get costlier? Onion prices may force restaurants to hike rates

Indian Hotel and Restaurant Association (AHAR) on Friday said they may have to hike rates of the dishes that contains onion if the tuber prices does not reach to around Rs 60 per kg level soon in the city.

Onion prices had touched Rs 160-170 per kg in local vegetable markets across Mumbai and its suburbs over the last week.

However, on Monday, prices of the tuber began to fall by up to 30 per cent with onion growers bringing more domestic produce to wholesale markets to get the benefit of the higher prices.

"The onion prices are on a downward trend and have gone down by 30 per cent in Mumbai. We will wait and watch the trend for a week to 10 days before taking a decision of hiking prices on the dishes that contain onion," AHAR president Santosh Shetty told PTI here.

AHAR is an apex body which has over 8,000 members of big and small scale restaurants in Mumbai.

The rates of onions had increased sharply in the last two months, the tuber which was available in Rs 20 per kg, crossed over Rs 100, Shetty said.

"There are many hotels and restaurants which have cut down on onion-based items. If this situation continues, we will be left with no option but to increase the prices as we cannot sustain the business," he added.

The AHAR members had called for a meeting of hotel and restaurant owners last week to decide on the future course of action.

In India, especially in Mumbai, onion is used for making gravy in almost all dishes. It is also served as Salad and Topping for free. But, after the rate hike, the restaurateurs stopped offering it for free.

Average onion prices across major cities have jumped five-fold in the last one year to Rs 101.35 per kg as domestic production in Kharif and late-kharif seasons (summer-sown) is estimated to have declined by 22 per cent.

The untimely prolonged rains in the major onion growing states of Karnataka, Maharashtra and Madhya Pradesh during the harvesting period of September and October damaged the crops.

To curb the rising prices of the tuber the government has taken various measures like creating onion buffer of about 57,373 tonnes during Rabi 2019, the ban on exports since September 29, facilitation of import, the imposition of stock limit on traders among others.