New Delhi: Onion prices may not fall sharply this year even after fresh crops flood markets, as record exports and a decline in kharif (summer crop) output due to scanty rainfall in growing regions would reflect in demand-supply scenario.
“Prices may not slump this year even if fresh crops reach markets, as decline in kharif crops in Maharashtra by about 50% coupled with the depletion of storaged onion would impact supply,” National Horticulture Research and Development Foundation additional director Satish Bhonde said. The prices, which have already shot up, may continue to trouble consumers at least till the last week of this month.
Once the fresh crop reaches the markets, soaring demand and the need to create stocks may provide some support even though prices will fall from the present level, he said, adding that some moderation in prices could be expected towards the end of this month.
The sharp increase in exports seems to have also drained the stocks and impacted prices, as onions stocks have mostly been used for shipments this year due to delay in arrivals of kharif crops.
According to the latest data, the country has exported a whopping 1.21 million tonnes (mt) this fiscal till December against 6,90,644 tonnes in the same period the previous year, riding low maximum export price (MEP) for most part of the year as well as higher storage.
Onion stock remained higher by almost 5,00,000 tonnes at about 2.6mt. The current rise in prices can also be attributed to the delay in arrivals of kharif onion by almost three to four weeks in Maharashtra, as sowing was delayed due to late rains, a National Agricultural Cooperative Marketing Federation official said.
Wholesale prices in Lasalgaon in Maharashtra, a major onion-producing state, have shot up to Rs1,325 a quintal from Rs251 per quintal in the same period last year. The wholesale prices in Azadpur mandi in Delhi are ruling even higher at Rs1,700 per quintal against Rs450 a year ago. In the retail markets here, onion prices are ruling at Rs21 a kg.
Onion is cultivated three times a year. Normally, acreage in the early kharif season has a 30% share in overall areas, whereas late-kharif accounts for 30% and rabi (winter crop) season for 40%.