Resumed Imports: Traders in Nepal Reopen Onion Imports as Demand Increase
Traders in Nepal have resumed importing onions from India to meet the soaring domestic demand ahead of a festival season, days after the supply was halted following India’s decision to slap a 40 percent export tax on the vegetable. Last week, India, the world’s biggest exporter of onions, imposed a 40% tariff on the export of the vegetable till 31 December to restrict overseas sales.
The move reportedly came amid anticipation of a price rise ahead of the festival season when demand for most commodities goes up. The new tariff had severely affected Nepal as several traders in the Kalimati Fruit and Vegetable Market – the Himalayan nation’s largest wholesale market for agricultural products – reported a sudden scarcity of onions. Nepal imports 99% of its onion requirements from India.
On Wednesday, 120 tonnes of onions were imported from India, and on Thursday, 145 tonnes came till noon, said Binaya Shrestha, spokesperson at the Kalimati Fruits and Vegetable Market Development Board.
Supply Adjustments and Monitoring: Wholesale Prices Set, Market Monitoring Intensified Amidst Import Resumption
In response to the adjustments prompted by the export tax, the wholesale price of onions has been recalibrated to USD 90.77 per quintal. Acknowledging the swift implementation of India’s export duty, traders temporarily ceased onion imports on both Monday and Tuesday.
This alteration in tariff dynamics led to a significant surge in prices. The cost of onions at retail quickly escalated from the initial USD 84.72 per quintal to the present rate of USD 121.03 per quintal. The pronounced price volatility raised concerns about possible stockpiling by traders following the announcement of the tariff.
Amid these price fluctuations, the reassuring news is that the supply of onions has managed to find equilibrium. Currently, the market reflects a robust inventory level of this essential commodity, countering earlier fears of scarcity.
Acknowledging the concerns raised by consumer groups regarding the scarcity of onions and the subsequent steep price increases, the Customer Protection Division, operating under Nepal’s Ministry of Industry, Commerce, and Supplies, has intensified its vigilance through a comprehensive program of heightened market monitoring activities conducted over the past week.
Throughout this duration, the division has executed rigorous market surveillance at more than 30 key locations. Ghanashyam Subedi, the director of the division, has underscored the extensive nature of the monitoring and enforcement measures undertaken. Furthermore, Subedi has emphasized the stringent enforcement of penalties and fines against individuals found to be involved in unjustified price inflation, in strict accordance with the robust consumer protection laws that are firmly established.
This appears to be a favourable chance for exporting onions to Nepal.
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