A boy helps his mother sort out good onions from a pile of nearly-rotten onions the woman bought at a low price from the wholesale market. They will then sell these onions at a profit as onion prices keep soaring nowadays. The photo was taken in Maniknagar area of the city on Sunday. — FE photo Onion prices in Bangladesh surged by Tk 10-15 per kilogram on Sunday after India imposed a 40-percent export duty on the key cooking ingredient.
The Indian government's move on Saturday caused a sudden hike in onion prices in Dhaka and elsewhere in the country, with imported varieties shooting up to Tk 70-80 per kilogram and local varieties to Tk 85-95 per kilogram.
In Chattogram, onion prices also rose at both wholesale and retail levels just in a span of two days. The prices soared by Tk15 to 18 in Khatunganj, Asadganj and Chaktai wholesale markets of the port city on Sunday. With the Tk 58 to Tk 65 wholesale rate, the bulb reached around Tk 75 to Tk 78 in retail.
In the first week of June, the government resumed onion imports from India as prices soared to Tk 105 per kg following a drop in domestic production due to unfavourable weather conditions.
Since then, Bangladeshi traders imported more than 0.32 million tonnes of the bulb from India in the past two and a half months, most of it at a price of $300 per tonne. This helped keep prices in the Bangladeshi market relatively stable.
In July, imported onions were retailing at prices ranging between Tk 40 and Tk 50 per kilogram, while local counterparts commanded rates of Tk 60-70 per kilogram.
By the second week of August, onion prices rose by Tk 10 per kilogram. Imported onion prices ascended to Tk 50-60 per kilogram, while local varieties reached Tk 70-85 per kilogram.
The announcement from the Indian government has resulted in a further increase of Tk 10-12 per kilogram in wholesale prices, Abdul Hoque, the proprietor of Miaji Store at East Rayer Bazar, told the FE.
Hoque said the wholesale price of imported onions surged to Tk 65-68 per kilogram on Saturday night, a significant jump from the previous Tk 55-60 per kilogram.
He mentioned that the wholesale price of the local onion variety also saw a rise of Tk 10-12 per kilogram, reaching Tk 80-82 per kilogram on Sunday morning.
Belayet Hossain, a trader based in Dhaka's onion wholesale hub Shyambazar, said the cost of importing onions has now surpassed Tk 55-60 per kilogram, a notable increase from its previous range of Tk 38-42 per kilogram just a few days earlier.
He pointed out that the average retail price of Indian onions range between Tk 45 to Tk 55 per kilogram when converted to Bangladeshi currency.
Meanwhile, as reported by the Indian Express, the central government of India has implemented restrictions on onion imports due to upcoming elections in several states and various religious festivals in the coming months, which are expected to drive up demand significantly.
The Indian Express report said that the government anticipates a potential shortage of onions in September, prompting India to impose higher costs on exports until December 2023.
Professor Golam Hafeez Kennedy, a value chain expert, said India is an unpredictable market for key essentials.
He recalled that in August 2019, India abruptly banned onion exports, causing prices to surge to an all-time high of Tk 280-290 per kilogram in the Bangladeshi market.
Professor Kennedy emphasised the importance of having access to local production data in a timely manner.
He pointed out that considering both household and commercial demand, the need for onions currently stands at a minimum of 3.0 million tonnes, while production reaches a maximum of 2.5 million tonnes, even as the agriculture ministry asserts a figure of 3.4 million tonnes.
He said local traders should explore sourcing onions from countries other than India to maintain stability in the local market.
Professor Kennedy recommended that the commerce ministry establish a buffer stock of onions to manage any market volatility until the beginning of the early seed onion (murikata) harvest.
He also called for the immediate implementation of stringent market monitoring to ensure that onion prices remain affordable for the consumer.
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