Wholesale onion prices declined by nearly 15% to Rs 1,851 per quintal at Lasalgaon — the country’s largest wholesale market for the bulb on Tuesday on reports of the government increasing the Minimum Export Price (MEP) of onions. On Friday, average wholesale onion prices were Rs 1,200 per quintal. And, around 27,115 quintal of onion was auctioned at Lasalgaon on Monday. The average wholesale onion price at Lasalgaon had recorded 20-month high at Rs 2,300 per quintal on August 3 due to rise in demand. The average wholesale onion prices have soared in past two months, from Rs 450 per quintal on May 31 to Rs 2,300 per quintal on August 3. Farmers went into a panic mode last week with reports of private traders contracting deals for onion imports from Egypt in the wake of rising prices.
As per reports, traders have contracted deals for over 2,000 tonne of onion in the range of Rs 2,000-Rs 2,500 per quintal. The landing cost in Mumbai is reported to be around Rs 22 per kg. Wholesale onion prices have touched Rs 30-40 per kg in major cities. Onion auctions came to a halt at Lasalgaon for a while after maximum prices suddenly rose to Rs 2,700 per quintal, triggering huge arrivals and a sudden drop in prices to Rs 2100-1750 per quintal which led to unrest among farmers. Auctions had to be halted on Friday as well on huge arrivals.
According to Jaydutt Holkar, chairman, Lasalgaon Agriculture Produce Market Committee, wholesale onion prices have declined on reports that the government may increase MEP to Rs 450 per tonne.
Earlier, the onion prices had crashed and farmers were incurring huge losses. Farmers had just started getting good rates due to rise in wholesale prices, but the prices may start declining if the government increased the MEP and imported onions, Holkar said. He said the market committee has been unable to confirm details of the import deals by private traders but these consignments are expected to land in India in the next eight days. As per reports, around 100 containers of onions from Egypt are expected to land in Mumbai next week.
Manoj Jain, a trader, said that the drop in prices is temporary and prices would rise in the next couple of days on demand from the West Bengal, North East, Uttar Pradesh and Bihare. “There are heavy rains in these places and therefore the trucks that were sent had to be halted for a while.Demand should pick up again in a couple of days which should take prices to Rs 2,100-2,300 per quintal,” he said.