Onion prices are rising as the production of the crop in India has been cut by unfavourable weather.

Onions retailed between Tk 45 and Tk 50 a kilogram yesterday, up 19 percent from a month ago, according to the Trading Corporation of Bangladesh.

Wholesale prices are going up faster. Onions traded between Tk 42 and Tk 50 yesterday from Tk 35 and Tk 36 per kilogram a week ago, said Ratan Kumar Saha, owner of Ratan Enterprise, a Dhaka-based onion importer.

“Import prices started going up after the Eid," said Md Alamgir Hossain, an onion importer at Bhomra Land Port, a station at Satkhira that handles most of the onions imported from India.

“Suppliers have said onion supplies are depleting fast in the Indian markets.”

Bangladesh consumes 20 lakh tonnes of onions a year. The country has to import 5 to 8 lakh tonnes a year to meet domestic demand, according to data from Bangladesh Bureau of Statistics and National Board of Revenue.

A bulk of the deficit is met through imports from India.
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Alamgir said he imported onions from the neighbouring country at around Tk 47 and Tk 49 a kilogram at Bhomra in the past two days.

The number of trucks carrying onions to Bangladesh has also declined in recent days, he said.

Unseasonal rains in parts of India in May hit the onion-growing areas hard. That is the time the crop is ready, but almost 25 percent of the produce was lost to the showers.

Onion supplies from Andhra Pradesh and Karnataka reach the markets in July, but the southern crop has been hit by the dry spell, according to Times of India.

At India's largest wholesale onion market of Lasalgaon in Maharashtra, the average price has leaped 54 percent in two weeks to Rs 2,550 ($40) per 100 kilograms -- its highest since November 2013, Reuters reported on July 24.

To curb the domestic price spiral, National Agricultural Cooperative Marketing Federation of India floated a tender last week to import 10,000 tonnes of onions from Pakistan, China, Egypt or any other origin.

Saha said the shortfall in India has fuelled the overall prices of onions worldwide.

"We used to import onions from China as well. However, prices have gone up there. Malaysia, Indonesia, Singapore and some Middle Eastern nations that usually bought onions from India, have also turned to China," he said.

However, onion prices should not go up much here because of a good local harvest in the immediate past season, said Saha.

BBS is yet to finalise the onion output for the last season, but Department of Agricultural Extension estimates that total onion production rose to 17 lakh tonnes in fiscal year 2014-15 from 14.88 lakh tonnes the previous year.

“So, the possibility of a surge in onion prices is low unless people start panic buying."

Source:- thedailystar.net