Onion Wholesale Prices Drop Dramatically, Retailers Slow To Follow

In a welcome relief for home budgets, the price of onions has been steadily falling in recent weeks, as per a Hindustan Times (HT) report. This decline is attributed to an increase in arrivals at the wholesale market, although the retail market has yet to fully reflect the drop in prices.

At the APMC market in Turbhe, wholesale onion prices, which had risen to Rs 35-40 per kilogram last month, have now fallen to Rs 9-16 per kilogram. At the start of the month, prices ranged from Rs 12-26 per kilogram, showing a continued downward trend. However, in the retail market, prices are still relatively high, ranging from Rs 35-40 per kilogram, compared to Rs 40-45 per kilogram previously. Retailers have not reduced prices significantly yet, as they are still working through their earlier stock.

The surge in wholesale onion arrivals has outpaced the demand, with around 90-110 vehicles bringing approximately 25,000 bags of onions to the market daily. The supply is also over 30 per cent higher than last year, coming from major onion-producing areas like Nashik, Ahmednagar, Pune, Satara, and Sangli, as well as from Rajasthan, Madhya Pradesh, and Gujarat.

According to Ashok Karpe, an onion wholesaler, the price is expected to remain low at least until April. "With new crops coming in and stocked onions expected in the market soon, prices could drop further," he said.

However, the falling prices are causing concern for farmers. Mangesh Suryavanshi, a farmer, expressed his worries, stating, "The price has been falling substantially every week. At the present rate, we are hardly able to cover our costs. We need at least Rs 20 per kilogram to earn something from our produce. However, with the rate at which prices are falling, we may soon not even be able to recover our costs."

Suryavanshi also suggested that the government should remove the 20 per cent export duty on onions to make them more competitive in the international market, as countries like Pakistan are benefiting by pricing their onions cheaper.

Adding to this, Suryavanshi noted that summer produce, which lasts longer and can be stored for up to eight months, is often purchased by traders at low prices. These traders then stock up and sell the onions at higher prices later in the season.

Retailers like Sunil Yadav from Vashi explained that the drop in prices has not yet been fully passed on to consumers. "The price has marginally dropped. But we cannot immediately bring down the price in proportion to the prevailing wholesale price since we already have adequate stock that was purchased at a higher price," he said.

While consumers enjoy lower prices at the wholesale level, the situation remains challenging for farmers who are hoping for better prices to cover their costs.