Onion prices dip further as supply increases

Onion prices nosedived further this week as arrivals flooded various markets across Maharashtra and Gujarat.

“Prices dropped by over Rs 100 a quintal this week as farmers rushed to sell their produce,” said Mr Rupesh Jaju, Director of Nashik-based United Agro Pacific Pvt Ltd.

In Pune Agricultural Produce Marketing Committee yard, the modal price or the rate at which most trades took place dropped to Rs 485 a quintal from Rs 600 a week ago. Price of best grade onion too dropped to Rs 680 from Rs 800 a quintal.

On Sunday, arrivals in the Pune market were nearly 4,500 tonnes. Since the third week of February, arrivals have been in the excess of 2,000 tonnes against the usual 1,000 tonnes.

Though the Centre cut the minimum export price for onion to $450 from $600 a tonne, prices still dropped.

“Buyers abroad feel $450 is still high and the cut is not enough. Whatever buying is taking place abroad is need-based. If prices drop to $275-300 level, then we could see demand emerging,” said Mr Madan Prakash, Director at the Chennai-based Rajathi Group of companies that exports onion.

Mr Jaju said exports were likely to pick up with enquiries coming in from the Gulf and Europe.

“Exports seem to be picking up and we are seeing some demand coming in. But there is a general feeling that prices can drop a little more,” said Mr Jaju.

Traders see onion prices falling another Rs 100 a quintal.

“The Lasalgaon market is closed as there is no place to accommodate the huge arrival. Once the market opens, arrivals will again flood. Chances are that prices could be under more pressure,” Mr Jaju said.

COMMENT NOW