Onion prices surged overnight after traders hiked rates in the wake of restriction imposed by India on shipments of tubers to other countries to contain its domestic prices.
The Indian authority slapped $850 (Tk 71,821) as minimum export price for per tonne of onion on September 13, a move that made onion market highly volatile here as Bangladesh meets a portion of its annual demand for the key cooking ingredient through imports for inadequate domestic production.
Retail prices of onion soared 25 percent overnight to Tk 55-Tk 70 per kilogramme yesterday in the markets of Dhaka city, according to data of the Trading Corporation of Bangladesh, which takes into account major markets of Dhaka city.
However, some retailers at Mohammadpur Town Hall kitchen market asked for as high as Tk 80 for one kilogramme of locally grown onions.
On Friday, Mohammad Ruhul Amin, who sells onion and other spices at the market, sold locally grown onion at Tk 60 per kg.
Amin, who sold imported onions at Tk 50 per kilogramme, asked for Tk 60 a kg yesterday.
“Onion market went wild since last night. Prices have gone up and customers are inquiring about prices only to avoid buying for now,” said MA Hossain, owner of Allar Dan Vandar, an onion store at Mohammadpur Krishi Market, a wholesaling hub in the capital.
Traders at Shyambazar, Dhaka’s main wholesale hub for onion, said the wholesale rates of imported onions from India rose to Tk 50-52 each kilogramme yesterday from Tk 43-44 on Friday, said Narayan Saha of Nabin Traders, a wholesale store for onion at Shyambazar.
“Onions have become dearer suddenly. India’s restriction has impacted prices on fears of decline in supply at a time when supply of locally grown onions has been low,” he said.
Rainfall damaged a good amount of local onions during the harvesting season in April-May, said Aminul Islam, a wholesaler of locally grown onion in Pabna, one of the main production zones.
Local onion prices shot up about Tk 300 each maund to Tk 2,600 yesterday from Tk 2,300 the day before. “Most of the farmers do not have onions in their stock,” Islam said.
Mohammad Abdul Mazed, general secretary of Shyambazar Onion Aratdar (wholesalers) Association, said domestic production can meet demand for 7-8 months and 7-8 lakh tonnes of onions need to be imported.
“We in general suffer for onion shortage for three-four months,” he said, adding that volatility in prices of onion would decline because of increased imports from Egypt, China and Myanmar following restrictions from India.
“Nothing to worry,” he said.
Amin of Mohammadpur Town Hall kitchen market, however, feared that prices might go up unless adequate supply is ensured quickly through imports. The government should take measures to facilitate quick imports. Otherwise, people will suffer for high prices, he said.