Onion prices may go up in Oct on delayed sowing

Written by Sandip Das | New Delhi | Updated: Jul 20 2012, 08:25am hrs
The sowing of kharif onion has been delayed in Maharashtra, the biggest producer of the key vegetable, due to deficient rainfall, which is likely to push up retail prices by October.

All the three regions of Maharashtra have received lower southwest monsoon rainfall between June 1 and July 18, with the central region receiving -41% less rains, Marathwada and Vidarbha getting -27% and -20% less precipitation, respectively, the India Meteorological Department (IMD) said on Thursday.

A trader from Nashik the hub of the countrys onion trade said that due to a month-long delay in sowing, the kharif crop would not enter the market till September, thereby pushing up prices.

Although at present we have enough stocks from the summer crop to last till the middle of September. But if the sowing is delayed further, it would push up prices in October, National Agricultural Cooperative Marketing Federation of India (Nafed) board member and farmer leader from Nasik region CB Holkar told FE.

Holkar said farmers in Maharashtra have been bringing in produce daily to various markets in Nashik district besides holding on to some stocks in anticipation for better price realisation.

The department of consumer affairs data indicate that onion prices across key cities have not been volatile during the last three months. Meanwhile, the wholesale price in Nashik is around R450 500 per quintal. The retail price across metros is in the range of R14 16 per kg.

The monsoon this year would be crucial to kharif production and the prices could look northward after September due to delay in arrival of kharif output, a trader from Nasik said.

The government lifted the ban on onion exports in May on a bumper summer crop and the country exported 1.1 lakh tonne of the commodity in June.

The government is also likely to take a call on the MEP shortly.

India, the second-largest onion producer in the world, had shipped 1.5 million tonne (mt) of the key vegetable in 2011-12. The realisation from the onion exports during 2011-12 was R1,714 crore. During 2010-11, India exported onion worth R2,159 crore to countries like Sri Lanka, Bangladesh, Russia, Europe, Mauritius, China, Singapore and those in the Gulf. The production during 2011-12 (July-June) is estimated at 15.13 mt. Maharashtra, with more than 40% of the total domestic production, is the leading grower followed by Karntaka, Tamil Nadu and Gujarat.