Sky-rocketing onion prices in the state are unlikely to stabilise for another month with onion-producing regions in South India being affected by inclement weather and the supply from the Nashik in Maharashtra expected to remain stunted till auctions begin after the Diwali weekend.
With rains playing havoc with the crops in Andhra Pradesh and Karnataka, which supply huge quantity of the vegetable to the city, traders here have not only seen a drastic reduction in the inflow of onions but also continue to remain uncertain about the pick-up in volume once the flood waters recede.
“If the Kolkata markets were receiving 600 tonnes of onion per day from the South under normal circumstances, it has now come down to about 100-150 tonnes everyday. There is no way of saying how much of the crop has been affected due to the floods and this scare will unsettle the prices,” Posta Bazar Onion Merchants Association secretary Ashok Yadav said.
However, with the city's onion requirement hovering around the 1,000 tonnes mark, and demand not likely to abate with the festive season continuing, the only available supply is from Nashik. But with auctions suspended temporarily due to the Diwali holidays, outflow from there will only hit the Kolkata markets after the post-holiday harvest takes place.
“The prices here are now stable around Rs 1,300 per quintal and this is expected to continue. But since this part is the only source of onions and with areas in the South such as Hubli being hit, the overall supply is limited. The farmers will only harvest the crop after Diwali after which it will be transported,” Sunil Jain, an onion trader from Lasangaon market, a major onion hub in Nashik district, told Business Standard.
However, with a majority of the Nashik supply to this region earmarked for other countries, Jain added that unless the government put a stop to exports, even if only on a temporary basis, it would be difficult for the prices to stabilise as demand would outstrip supply.
On the upside though, if the rains didn't play truant in Maharashtra and the onion harvest in Rajasthan continued unhindered, then the prices could come down to the September levels by December, Jain added.
