Centre moves in to check onion prices

Tribune News Service

New Delhi, October 20

As onion prices soar, a worried Centre has moved in to take charge of the politically-sensitive vegetable, reviewing its availability with stakeholders concerned and assuring a redress within a week.

With festival season on and Assembly elections in five important states round the corner, the ruling dispensation’s concern is understandable given that the kitchen essential is known to have brought down governments in the past.

The Consumer Affairs Ministry yesterday issued a statement on measures being taken to control prices, while assuring that sown area under the kharif onion was higher than last year and that its arrival had commenced from Karnataka, which would improve availability in consuming areas and moderate prices.

Retail prices have been ruling around Rs 30-40 a kg due to short supply from Lasalgaon, Asia’s largest onion wholesale market.

Prices shift on the basis of supply in the growing months — April to August, October to December and January to March. When there is a glut, the government also has to move in to make exports viable by reducing the minimum export price.

The market is controlled by traders and exporters, all very influential and capable of manipulating/exploiting a situation, which in this case is the poor monsoon rain in growing parts of Maharashtra.

Susceptible to market forces

• Maharashtra, Karnataka and MP are the key suppliers of onion. The supply passes through a few big markets, majority of which are located in Maharashtra and Karnataka
• Traders and exporters sometimes manipulate a situation by hoarding onion, which has a high shelf life
• Retail prices have been hovering around Rs 30-40 a kg due to short supply from Lasalgaon, Asia’s largest wholesale market