Onion prices in India may fall to less than Rs 40 per kilogram as early as January, consumer affairs secretary Rohit Kumar Singh said according to the Press Trust of India.
He also said prices would not exceed Rs 60 per kg until then.
Somebody said it will touch Rs 100 per kg, we said it will never cross Rs 60 per kg. So, all India average is now Rs 57.02 per kg this morning and it will not cross Rs 60 per kg,” PTI quoted Singh as saying on Monday (December 11).
Last week, the Union government banned onion exports until March, citing the need to make the vegetable available to Indian consumers at affordable prices.
“The government took the decision taking into account delay in kharif arrival, the quantity of onion exported and [the] global situation such as trade and non-trade restrictions imposed by major suppliers such as Turkey, Egypt and Iran,” the Union food ministry said.
The average retail price of onions in India was Rs 57.1 per kg earlier this month, almost double the average price in the same month last year (Rs 28.9 per kg), Bloomberg reported citing Union government data.
Prices were reportedly as high as Rs 80 per kg in Delhi.
Onion inflation has remained in the double-digits since July and rose to a near four-year-high of 42.1% in October, PTI’s report said.
A press release by the food ministry on Monday said that cooperative bodies under the ministry had been directed to procure seven lakh tonnes of onions from farmers for the government’s buffer stock.
It added that the government was “continuously” selling onions from its buffer stock to keep prices in check.
“Till date, about 5.10 lakh tonnes had been procured, and procurement of remaining quantity is ongoing. Onions [procured] by the government are continuously disposed in high price markets through open market sales and direct retail sales to consumers,” the ministry said.
Farmers in Maharashtra, which reportedly produces the most onions of any state in India, have protested the government’s decision to ban exports.
Consumer affairs secretary Singh reportedly said the protests were “sponsored by traders”.
He also said in an interview to The Hindu last month that traders taking advantage of delayed kharif harvests were partly to blame for the rise in onion prices.
“The traders take advantage of the situation in this little period. It is not just demand and supply, it is also manipulation by traders,” he said.
“Not all traders are bad, but some are taking advantage of this situation. It is not hoarding, it is speculation – spreading news of shortage. There is no instance of deliberate hoarding,” Singh was quoted as saying.
Onion prices in neighbouring South Asian countries rose after India’s export ban, with markets in Bangladesh, Nepal, Bhutan, Sri Lanka and the Maldives reporting steep price hikes.
India had introduced a minimum export price of $800 per tonne on onion exports on October 28. The extension of the curbs on onion export in the form of a total ban has come three weeks ahead of the expiry of the earlier deadline.
Union finance minister Nirmala Sitharaman said in parliament on Monday that retail inflation had become “stable” and was within the Reserve Bank of India’s tolerance limit.
Her remarks came a week after experts had raised concerns about rising food and retail inflation in the country.
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