Onion prices halve on govt action

After touching a high of Rs 80 a kg last week, onion prices are now heading southward following government action and improved arrivals. The retail price of onions has nearly halved to Rs 45 a kg, though it remains significantly higher than last year’s corresponding price of around Rs 25. Experts anticipate a further softening in prices.

“Onion harvesting is normal in Maharashtra and Gujarat. Some farmers are also harvesting the crop prematurely to cash in on the high prices,” said Rajinder Sharma, general secretary of Azadpur Onion Merchants’ Association.

In a concerted effort, central and state agencies are selling onions at Rs 22-40 a kg. While Nafed has onions at Rs 35 a kg, Mother Dairy, Kendriya Bhandar and National Consumer Cooperative Federation are selling onions at Rs 40 a kg through their respective outlets. In Lucknow, the district administration is opening 25 outlets to sell onions at Rs 22-24 a kg.

The sharp spurt in onion prices last week was attributed to crop damage because of excessive rains in Maharashtra and Karnataka, which together account for 40 per cent of the country’s total production of 12 million tonnes.

The Centre has banned onion exports and abolished customs duty on its import to rein in prices, which have since then fallen 50 per cent in wholesale markets of Nashik to Rs 32-35 a kg.

National Horticultural Research & Development Foundation Director R P Gupta said wholesale prices are declining by Rs 100-150 a quintal daily.

Onions have a weight of just 0.09372 per cent in the wholesale price index.