Onion prices start to fall after govt allows imports

Onion prices have started to decline after the government allowed imports, giving relief to consumers struggling with persistent inflation, particularly high food inflation.

Retailers in Dhaka and Chattogram said onion prices have dropped by Tk 25-Tk 30 per kg since the government announcement.

They, however, added that supply has not increased significantly in wholesale markets, resulting in less decrease in prices than expected.

Last week, retail onion prices surged by Tk 30-Tk 40, reaching Tk 150 per kg. In response, the agriculture ministry announced on Saturday that imports would be allowed.

In the past three days, the government has allowed the import of 4,500 tonnes of onions, said Boni Amin Khan, additional deputy director for import at the Plant Quarantine Wing of the Department of Agricultural Extension (DAE), which issues phytosanitary certificates needed to import any plant into the country. "Of this, 510 tonnes have already arrived."

He added that all imported onions came from India.

Mohammad Ratul, a retail seller from Tejturi Bazar in Farmgate, Dhaka, said prices of onion dropped to Tk 140 per kg yesterday. Four days ago, I sold onions at Tk 170 per kg, he added.

"Onions are still not available in wholesale markets according to demand," he said.

Abdul Majed, general secretary of the Shyambazar Onion Traders' Association, said before the import permission, the wholesale price was around Tk 140 per kg. After approval, prices dropped to Tk 110-Tk 115 per kg yesterday.

"It looks like prices will drop further," said Majed, also an importer based in Shyambazar, a major wholesale market.

Wholesale and retail prices in Chattogram have fallen by Tk 20-Tk 25 per kg. In major wholesale hubs such as Khatunganj, Chaktai, Chawkbazar, Oxygen, and Kazir Dewri, locally produced onions sold for Tk 100-Tk 110 per kg yesterday, depending on quality, while Indian onions were priced at Tk 116-Tk 120 per kg.

At the retail level, local onions sold for Tk 120-Tk 130 per kg and Indian varieties for Tk 125-Tk 135 per kg.

Omar Faruk, owner of Era Trading in Khatunganj, said, "The port city needs around 30 truckloads of onions daily, but only 5-7 trucks are entering the market now. It may take another two to three weeks for newly harvested onions to arrive, so prices have not stabilised yet."

He added that only three truckloads of Indian onions entered Chattogram in the past two days.

Ahsan Uddin, a retailer at Kazir Dewri market, said, "Supply is much lower than demand, so prices remain high. Retailers are also buying smaller quantities, in hopes of prices falling at any time."

"Reduced purchasing volumes, along with rising transport and handling costs, have kept prices elevated. Although Indian onions have entered Khatunganj, many retail markets, including mine, have not received any yet due to limited supply," he added.

The DAE estimates last season's harvest at over 39 lakh tonnes, enough to meet domestic demand. However, it projects that an additional 6-7 lakh tonnes of imports will be needed to offset post-harvest losses.