The export ban on onions has had an immediate effect on its wholesale and retail prices, which have dropped by over 33%. While this is good news for the common man, traders said the farmers would suffer. The supply of onions, however, to the wholesale market dropped by 60% on Monday.
Onion wholesale prices at the Vashi Agriculture Produce Market Committee (APMC), which were around Rs15 per kg before the ban, have now come down to Rs10 per kg. In the retail market, the prices dropped from Rs18 per kg to Rs13 per kg.
The traders are not pleased with the situation. Ashok Tarpe, a wholesale trader at APMC market said, “The government had banned the export of onion to control the rising prices last year as well. That time, however, the situation was really bad with onion prices reaching Rs60 per kg,” said Tarpe.
“This time, there was no need to ban onion exports because the wholesale onion prices were not that much. The farmers were recovering their cost of production and making a small profit. At the prevailing price, they have to suffer loss,” he added.
While explaining how farmers were making a profit, wholesale trader, Bharat More said, “The original cost of production for the farmers works out to Rs6-7 per kg. They store the produce for sale in August-September period. This pushes up the cost because storage expenses have to be incurred and some produce rots as well. The cost then goes up to Rs9-10 per kg. Therefore, they were getting some returns when the price was Rs15 per kg.” More added consumers would ultimately have to pay more for onions because of reduced supply.
Meanwhile, the supply of onions to the Vashi APMC fell sharply on Monday because of a strike at Nashik market where no auctions took place. While the market receives an average of 100 – 125 trucks and tempos every day, on Monday only 40 trucks arrived.
“Apart from the strike, the farmers too are following a wait and watch policy and hence are not releasing their stock now.”
Samruddhi Renose, a Vashi resident said, “In these times of inflation, it is good that the government has taken a timely step before things got out of hand.”