Gulf offtake supports onion surge

Onion prices continued to surge in markets near growing areas in Maharashtra and Gujarat, mainly on export demand.

On Friday, the modal price or the rate at which most trades took place increased to Rs 1,251 a quintal at Lasalgaon Agricultural Produce Marketing Committee (APMC) yard in Maharashtra. Prices have surged about Rs 380 a quintal since the beginning of the month.

The rise is despite the Centre raising the minimum export price twice since August 12 to $300 a tonne.

“Prices have gained because of demand from the Gulf,” said Mr Rupesh Jaju, Director of Nashik-based United Pacific Agro Pvt Ltd.

“Due to rain in Karnataka, demand from South is being met by Maharashtra and Gujarat onions,” said Mr Madan Prakash, Director of Chennai-based Rajathi group of companies.

According to Mr Jaju, rain in Maharashtra is also aiding the rising trend.

Barring the Gulf, demand from other countries is lukewarm.

“Only after Ramzan , countries such as Malaysia will begin buying. Sri Lanka will enter the market only next month,” said Mr Prakash.

Exports during April-July this fiscal are lower at 4.52 lakh tonnes valued at Rs 379.87 crore against 6.84 lakh tonnes valued at Rs 846.82 crore during the same period a year ago. The unit-value realisation is down to Rs 8,306 a tonne from around Rs 12,000 last year.

Average quality onions are ruling between Rs 700 and Rs 1,200 a quintal, while quality ones are fetching as high as Rs 1,400.

“Increased arrivals in the markets are not having much effect since whatever is coming to the yard in Maharashtra is being lapped up,” said Mr Jaju.

Kharif crop arrivals have begun but in a small way. “Kharif onions cannot be stored unlike rabi onion. However, the quality of kharif onion is such that it can be consumed only in the local markets here,” Mr Jaju said.

Prices could surge further and trade sources see a rise of another Rs 200 a quintal.

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