Onion prices soar to 5-year high amid supply woes, exports boost
onion prices continued this week as the quality of the kharif crop from Rajasthan, Maharashtra and Karnataka was poor and boosted demand for the old, pricier crop at a time when there was also a surge in export demand.
The maximum price of best quality onions jumped to Rs 70 per kg from Rs 51/kg a fortnight back, while the average prices have increased to Rs 58/kg from Rs 51/kg during the same period at the Pimpalgaon market in Nashik. There has also been a surge in exports as Bangladesh removed import duty on onions. Traders expect prices to decline only after 8-10 days as newer crop arrivals start elsewhere in the country.
Onion prices crossed the five-year high of Rs 54/kg last week at the benchmark Lasalgaon market in Nashik. Traders said it was because of supply shortages as the wholesale markets were closed for many days across the country for Diwali. There was a rise of 30-35% during the last week in the wholesale prices.
«Prices were going upwards due to lower arrivals. The stored onion from last year's rabi crop is depleting fast,» said Vikas Singh, vice president, the Horticulture Produce Exporters Association.
The highest price is fetched by the stored onions harvested in March/April, while the new crop's arrival has been delayed by heavy rainfall in September.
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