Onion Market Poised for Potential Surge: Heavy Rains and Delayed Harvests Could Drive Prices Higher

Onion Prices Show Stability, But Future Remains Uncertain

The onion markets are currently stable, with Saurashtra yards still closed due to the festival season. However, the future of the market will depend on how it responds once the yards reopen on Monday. In Rajkot (Gujarat) the price of onion was recently quoted between approximately $0,41 to $0,50 per kg before the festivals. Market experts predict a potential rise in prices, with expectations that onions could reach approximately $0,54 to $0,60 per kg if no further obstacles emerge.

Heavy Rains in Gujarat Threaten Onion Crop Quality

Several factors are contributing to the potential increase in onion prices. The heavy rains in Saurashtra-Gujarat have raised concerns about the quality of onions still in the fields, as well as those stored in stock. If these onions are exposed to the sun post-rain, there is a risk of spoilage, which could further impact the market. Additionally, the delayed monsoon onion harvest in Gujarat, now expected to be late by a fortnight, has added to the uncertainty. Had there been less rain, new onions would have entered the market by the end of September, but now the timeline has been pushed back.

Impact of Delayed Harvests and Stock Levels on Market Prices

Despite the challenges, the monsoon season in Gujarat has been favorable overall, with normal sowing expected compared to last year. Farmers are anticipated to harvest and sow the second monsoon crop after Navratri, with yellow leaf onions likely to be planted after Diwali. In southern India, the revenue from new onions has increased slightly, but overall, the income remains low. Recent rains have delayed new arrivals, and while sowing has been good, the crop estimate is still uncertain. In Saurashtra, a significant amount of old onion stock remains, which farmers and traders have held onto due to low prices this season. The market now waits to see the impact of any potential spoilage on these stocks.

Calls for Lifting Export Ban to Boost Onion Prices

Bharat Dighole, a representative from a farmers’ organization, has voiced concerns over the central government’s current policies. The government has imposed a 40% duty on onion exports and set a minimum export price of $0,55 per kg to control prices. However, Dighole argues that these measures have kept farmers from receiving fair prices. He advocates for the removal of the export ban, suggesting that this would allow farmers to secure better prices and recover losses incurred over the past year or two.

Currently, onion prices in the main markets of Nashik range between $0,24 to $0,43 per kg, with an average price of $0,39 per kg. With the government’s price control measures, the market may see further declines. NAFED’s buffer stock, expected to be released in September, could also drive prices down. Dighole’s organization has requested that the government refrain from selling these onions in the market.

The onion market faces a challenging period ahead, with heavy rains and delayed harvests in Gujarat adding to the uncertainty. While prices remain stable for now, the market could see a surge if weather conditions worsen and stored onions spoil. Farmers and traders alike are hoping for favorable government policies to ensure fair prices in the coming months.

Related posts:

Centre (Indian Government) Estimates Onion Production to Plummet by 15% India’s Decision to Allow Onion Exports India Takes Swift Action With Onion Export Duty to Counter Price Challenges Onion Prices Rise Amid Fears of Rain Damaging Rabi Crop New Gold in the Philippines – Onion Onion Prices 12 Dollars Per KG? Onion Prices Plunge to 5-Year Low, Reduce Growers to Tears India’s Onion price high compared to neighboring country