Onion prices may rise in Sept: govt-hired firm
A commodities firm, hired by the government to share market intelligence on kitchen staples to better target inflation, sees onion prices going up in September again ahead of the festival season.business Updated: Aug 25, 2014 09:58 IST
A commodities firm, hired by the government to share market intelligence on kitchen staples to better target inflation, sees onion prices going up in September again ahead of the festival season.
It has recommended that the government ramp up onion imports immediately, HT has learnt. According to Indian Agribusiness Systems Private Limited, which is supplying inputs on sowing, arrivals and stocks to the government, prices are expected to ease out as winter sets in.
When contacted, Agribusiness Systems Limited refused to share details of its price-monitoring data analysis. “September and October could be crucial months to watch out for,” CEO VN Saroja said.
However, HT has learnt that the report said onion arrivals in major markets have been lower than expected. A widespread hailstorm in February that wrecked onion farms has reduced supplies, while a poor monsoon has delayed the sowing considerably.
Prices could climb the peak levels seen in 2013, and even exceed them, the firm has said. Last year, onions retailed at as high as `90-100 per kilo -- depending on the variety -- in some urban markets.
“We will take appropriate action… but we take our own inputs too,” a food ministry official said.
In the third week of August, onion arrivals have been 10% lower than last year’s during the same time. The analysis also showed that the government’s move to increase the minimum export price (MEP) to $500 a tonne, which now stands at $350 a tonne, had a major impact in cooling prices. Increasing the MEP makes Indian onions expensive for foreign buyers, thereby improving domestic availability.
India’s retail inflation, a measure of rise in shop-end prices, rose to 7.96% in July from 7.46% in June. Consumer food price inflation, an index to gauge how costly the food platter has become in a year, galloped to the worrisome double-digit mark at 9.36% in July from the previous month’s 8.05% increase.