Onion price rises on supply crunch
Onion prices at retail markets in Dhaka rose by Tk 10 to Tk 15 per kilogramme (kg) over the past week, deepening the woes of low and fixed-income people.
Wholesale and retail traders across the capital said a supply crunch is causing the volatility in onion prices.
For all latest news, follow The Daily Star's Google News channel. Nurul Alam Shikdar, a retailer in the Pallabi extension area of Mirpur, said onion prices saw gradual increments over the past week, with local varieties going for Tk 140 to Tk 145 per kg today.
The sudden hike in prices of the popular cooking ingredient comes after six months of persistently high food inflation, which has hovered above 10 percent price since April this year.
Data from the Trading Corporation of Bangladesh (TCB) showed that local varieties of onions were selling for Tk 115 to Tk 135 per kg today compared to Tk 110 to Tk 120 a week ago.
Meanwhile, imported onions were fetching Tk 80 to Tk 110 per kg today, down by 5 percent from Tk 90 to Tk 105 a week prior, according to TCB data.
In the past year, prices of local onions have increased by 25 percent and imported onions by 18.75 percent, TCB data shows.
Mohammad Abdul Mazed, general secretary of the Shyambazar Onion Wholesalers Association, a major onion-selling hub, said there is a shortage of local onions at the retail level.
"We are getting only 20 percent of the demand. This is why prices have increased so much. Prices will come down after the next three months when new onions come to the market," he said.
He also said that, for some reason, the demand for imported onions has decreased, leading to reduced prices for foreign varieties over the past week.
The agriculture ministry claims the country produced 34 lakh tonnes of onions this year. Although that figure is enough to meet domestic demand, the ministry says that another 6 to 7 lakh tonnes will have to be imported as much of the local yield is wasted due to a lack of cold storage facilities.
However, traders in Dhaka's Shyambazar, a major onion-selling hub, said local output was about 20 percent below the agriculture ministry's estimate due to crop loss amid adverse weather in February.
Mohammad Hafiz Uddin, a wholesaler in Shyambazar, said local onions were sold at Tk 120 to 125 per kg today, up from Tk 103 to 105 just a week ago.
Hafiz claimed the quality of Indian onions also suffered due to floods, thereby decreasing the domestic demand for onions imported from the neighbouring nation.
In Pabna, the biggest onion-producing district in Bangladesh, prices of the bulb soared to as much as Tk 5,600 per maund (roughly 37 kgs) on Saturday, up by about Tk 1,200 over the past week.
Md Jamal Uddin, deputy director of the Department of Agricultural Extension in Pabna, said the current stock of onions can meet the demand of wholesalers for more than one month.
"We hope new onions will be available within the next couple of months," he said.
Noor Alam Chowdhury, senior scientific officer of the Spice Research Centre at Bogra, told The Daily Star that now many growers are now planting early winter varieties of onions, which will be sold in the market in December-January.
So, many farmers use old onions and produce seeds from them at this time. Those who do commercial production on a large scale also buy old onions from farmers. Due to this, the demand for old onions increases during October. It happens every year, he said.
During this period, the retail price of onions normally increases by Tk 10 to Tk 15 per kg, Chowdhury said.
Traditional onions are cultivated from mid-December and arrive in markets by March or April the following year, he said.
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