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Onion prices on the rise in Karnataka, as hoarders have a field day

Onion prices on the rise in Karnataka, as hoarders have a field day

ONE man’s misery is another man’s moment under the sun. Nothing amplifies this statement more than the run-away prices of essential commodities in India.

The withdrawal of the southwest monsoon left a wet and miserable trail for millions of people in peninsular India.

That spell of rains was an opportunity for speculators to make the hay and prices of the Indian kitchen’s main staple, onions, have zoomed.

The scene in Karnataka

Karnataka is one of the major producers of onion. As per the National Horticulture Board, Karnataka ranks third among Indian states in terms of onion production with an annual production of 22.75 lakh tonnes., That gives the southern state a share of 9.3 per cent in the national output. Maharashtra which produces 90.99 lakh tonnes ranks first accounting for 37.2 per cent of India’s production.

Retail prices have shown an upward bias

Retail price of onions in Bengaluru has shot up. “The older stock retails for about ₹56/kg while the newer arrival ranges between ₹34-36/kg. The newer arrivals are of inferior quality,” complains Suresh S, an onion and potato dealer.

The newer arrivals have quite a fair quantity of damaged stock. Incessant rains have seen water seep into the soil which hits bulb formation and damages the crop, says a dealer.

Wholesale prices are holding on

In major markets like Hubballi for instance, the wholesale price of onion ranges between ₹3,100 to 4,000/quintal (one quintal=100 kg). One caveat though. The ₹4,000/quintal is for the Puna variety of onion which is traded in the Hubballi market, while the ₹3,100/quintal is the price for the local variety.

Crop quality

Although there has been some damage to the crop in producing centers like Ron and Gadag, the initial bout of rains in August caused more damage to the onion crop in Chitradurga, Challakere and even Belagavi.

One estimate indicates that close to 70 percent to 80 percent of the crop in Chitradurga and Challakere has been damaged.

Sources also indicated that most of the farmers are holding back their stocks on the back of rising prices and would look at disposing of them later in the hope of realizing better prices. However, no information is available as to the quantum of stocks currently held by farmers.

Arrivals not disrupted

“We haven’t observed any disruption in arrivals on the back of the recent spell of rains. Bengaluru usually gets around 300 to 400 lorry loads of onions on a daily basis,” says Lokesh, president of the Bangalore Onion & Potato Merchants Association.

Sources in the onion trade said that onion continue to be moved by rake from centers like Challakere and Chitradurga. These supplies are to states like West Bengal and Assam.

Post Diwali, there could be not much joy

Onion traders who spoke to News9 have cautioned that prices could spike from the second week of November onwards when the newer production is scheduled to arrive in the market. However, as we have already said earlier, the newer crop does have some quality related issues and that push prices northward.

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