Pawar comments, govt inaction stoke up onion prices to Rs80/kg levels again

With no signs of an improvement in the supply situation until fresh crop is harvested, onion prices got a fresh boost following comments by agriculture minister Sharad Pawar that prices of the essential commodity will remain firm till October.

Speaking to a news channel on Monday, Pawar also said there should be no complaints about a rise in onion prices as it meant more money for farmers.

''There is a lot of talk about the rise in onion prices. However, when prices fall, no one shows any concern for the farmers. When farmers are getting more money for their produce we should not complain,'' he said.

Within hours of Pawar's comment, wholesale prices rose from Rs47 per kg to Rs58. On Tuesday, prices shot up again to levels around Rs70 - 80 per kg in major retail markets, fuelling headline inflation further.

In Delhi, retail prices of onions have shot up to a whopping Rs70 - 80 per kg, while in the Navi Mumbai market prices are now ruling around Rs70 per kg.

In Maharashtra's Lasalgaon, Asia's biggest onion market, the wholesale prices of the commodity increased from Rs4,140 per quintal to Rs5,300 per quintal, while arrivals of onion declined to 3,000 tonnes per day from 6,000 tonnes on 6 September.

The maximum price for top quality onions at Lasalgaon touched a high of Rs5,813 a quintal as arrivals stood at around 400 tonnes.

At Pimpalgaon, in Nashik, modal prices of onion touched Rs5,651 per quintal, the highest in wholesale markets across the country.

In Mumbai, the wholesale price increased by Rs1,000 per quintal over the past 15 days while at the Azadpur Mandi, Delhi's main wholesale market, prices have risen by more than 50 per cent to touch a new high of Rs60 per kg on Tuesday.

Organised retailers such as Reliance Fresh and Safal sold onions at over Rs65 per kg while retail vendors have been selling at much higher prices.

Wholesale price in Bangalore, however, declined following a 300 per cent increase in arrivals as the new crop that's being harvested in Karnataka and Andhra Pradesh has been hit by the recent rains.

The harvest of the new crop in the Nashik region is expected to commence by mid-October.

The small quantities of shipments that arrived from Egypt too were selling at high prices at Navi Mumbai's APMC market and did not make any impact on the supply situation.

India exported 6.39 lakh tonnes of onion during April-July compared with 6.94 lakh tonnes in the corresponding period last year.

Onion production in the country stood at 16.6 million tonnes in 2012-13, which was lower than in the previous year.