Drought impact: Onion prices skyrocket

Bengaluru: Drought has caused severe crop loss in Chitradurga, major onion-growing belt, leading to skyrocketing prices of onions in retail market. Arrivals of onions from Challakere reduced to less than 10% of usual. Quality of onions improved, but old 'peeled out' onions still available at lower prices. Union govt. fixed min. export price of $800/tonne till Dec. 31 to keep prices in check. Next week will tell if it works.

Not just avarekai, but several other crops, especially onions, have also been affected by drought in the State. As severe crop loss has been reported from Chitradurga, the major onion-growing belt in the State, the prices of onions have skyrocketed in the market. Onion is being sold at over ₹60 a kg in the retail market of the city for a week now. 

“During this time of the year, in a normal year, the Yeshwantpur APMC yard receives over 1,000 loads of onions from Challakere in Chitradurga every day. But there has been widespread crop damage due to drought and the arrivals are less than 100 loads a day, which is less than 10% than usual. This has pushed up the prices of onions,” said Ravi Kumar of Bangalore Potato and Onion Traders’ Association. He said even supply from Maharashtra had reduced also a trickle when compared with previous years. 

However, the quality of onions available now in the market has improved many folds when compared with that of those arriving in the previous month. “The new onions are red and are of very good quality. For over a month now, the only available onions were old onions, with their skin peeled out. Most of them had also sprouted already,” Ravi Kumar said. The old ‘peeled out’ onions are still available in the market for lower prices. 

Based on a prediction in July–August that the price of onions will skyrocket this season, the Union government is implementing several measures to keep it in check, including one on Saturday. The Union government has fixed a minimum export price for onions at $800 per tonne till December 31. This is a non-competitive price and will discourage exports, industry insiders said. “This move may lead to farmers dumping the crop they are holding in the market, which may bring a correction in the prices soon. The next week will tell us how this pans out,” a senior procurement officer with a chain grocery store in the city, said.