Marginal increase in onion prices with onset of summer

Written by Sandip Das | New Delhi | Updated: Mar 30 2012, 08:28am hrs
The onset of summer has resulted in a marginal increase in the retail price of onions in north India.

This is because the rabi crop can be stored for a longer time in the onion-growing regions of Maharashtra, enabling farmers to stock up on a greater chunk of the crop.

Traders, however, say prices are not expected to jump significantly as a bumper rabi crop is expected this time, which should sustain supply during the summer months.

According to a trader from Nashik, the hub of country's onion trade, farmers are still bringing in produce from the late kharif crop, which is expected to continue till the next few weeks.

Meanwhile, the wholesale price of onion is ruling around R400-450 per quintal. The retail price in Delhi has jumped to R15 per kg from R13 per kg two months back. In all other cities, the prices have declined marginally during the last two months.

The prices are expected to rise marginally during the next few weeks as farmers store a large chunk of the summer crop, CB Holkar, board member, National Agricultural Cooperative Marketing Federation of India (Nafed) told FE.

Nashik-based National Horticulture Research and Development Foundation (NHDRF), in its latest report, said The rabi onion crop's condition is good and under bulb development stage. The area under cultivation is expected to be about 10-15% more over the last year. The rabi onion production is expected to be more. Therefore, more onion is likely to be stored than the last year.

Meanwhile, onion exports are expected to reach 1.5 million tonne (mt) for 2011-12 against 1.3 mt reported in the previous year. The realisation from onion exports is expected to go beyond R2,200 crore during the current fiscal against R1,591 crore the previous year.

Sri Lanka, Bangladesh, Russia, Europe, Mauritius, China, Singapore and countries in the Gulf are key exports destination for Indian onions.

Under pressure from exporters and farmers, the government had last month slashed the minimum export price (MEP) of all varieties of onions, excluding Bangalore Rose onions and Krishnapuram, by $25 per tonne to $125 per tonne (freight on board FOB).

Onion production in the country is estimated to be more than 13 million tonne for 2011-12. Maharashtra produces more than 40% of the countrys onion.