At Rs 80/kg, onion prices bring tears

Prices soar across the country as heavy rain disrupts supply from Maharashtra and Karnataka

Prices in retail markets have risen by Rs 10-15 a kg in recent days and are now at Rs 70-80 a kg, mainly due to disruption in supply from Maharashtra and Karnataka, due to heavy rain. The two states together produce a little over 80 per cent of the country's crop.  

Experts say sowing in 2012-13 was the lowest in three years, with the crop being five per cent less than the previous year. Also, "the previous year's carryover stock was sold off due to rains in Maharashtra. So, there is a shortage till at least the fresh arrivals, which might start latest by the second week of next month," said Ashok Walunj, director of the Agricultural Produce Marketing Committee (APMC) at Vashi in Navi Mumbai.

The wholesale prices at Nashik district's Lasalgaon, the largest onion market in Maharashtra, was Rs 4,400 to 4,500 a quintal, a little over three times higher since June 3, when the price was Rs 1,275. In the past fortnight, the prices have surged by Rs 200 a quintal from the Rs 2,400 at the beginning of the month. “The arrivals are thin as compared to last year for the same month. At the Delhi markets, arrivals were 8,800 quintals, while the demand was 10,000 quintals. However, while prices have touched Rs 5,500 a quintal, we see some fall in demand,” said a source at the Azadpur Mandi in Delhi.

In Ahmedabad, wholesale prices were around Rs 5,000 a qtl "This is a record price at wholesale markets. Farmers are making good money but consumers are complaining of spiralling prices. Demand has taken a beating due to peak prices. But things might settle by mid-September," said a trader source at the Chimanbhai Patel APMC.

According to data from the National Horticultural Research and Development Foundation (NHRDF), the area under onion cultivation had dropped from 1,087,260 hectares in 2011-12 to 992,250 ha in 2012-13.

“Exports are taking place but the volumes have reduced. Our onion has become too costly for even the international buyers. We anticipate onion exports from India will drop against last year,” said a market source.

There was an export of 636,000 tonnes in the April-July period, about nine per cent less than in the same period last year

In 2012-13 (the financial year ends March 31), export of onion was two million tonnes, of a total production of 17 mt.