News

Onion prices spike on short supply

October 04, 2019

Sujeeta Pradhan, My Republica, October 04, 2019

KATHMANDU: Onion prices have more than doubled over past one and half months. The price has skyrocketed during the festive season where consumption of onion is very high. 

Traders say retail prices of onion started climbing up after mid-August. Onion price averaged Rs 60 per kg in the month of July and the price was more or less the same till mid-August. However, it increased by Rs 10 per kg on August 23, and Rs 5 per kg on September 12. According to traders, the price increased by another Rs 5 per kg a day later.

The price rise became more frequent after mid-September. Onion was traded at Rs 130 per kg on September 21. Though the price came down by Rs 20 per kg after a week, it soon climbed to Rs 140 per kg on September 30 as the market reacted to the Indian government’s decision to put a ban on onion exports.

Most of Nepal’s onion imports come from India. According to traders, about 98% of onions consumed in the country comes from India. Domestic productions meet only 2% of the market demand. 

Kathmandu Valley alone consumes 270 tons of onions in a day.

Officials of the Kalimati Fruits and Vegetables Market Development Board attribute rising prices of onion to price hike in the Indian market. “As almost 98% of onions that we consume come from India, any change in price in the southern neighbor is reflected in the domestic market,” Binaya Shrestha, deputy director of the board, told Republica.

According to Shrestha, only 140 tons of onions have entered Nepal in the past two days.

“Leave alone onions, Nepal even doesn’t produce onion seeds. Almost all farmers, who are producing onions, are using imported onion seeds,” said Shrestha.

Meanwhile, consumer rights activists have criticized the government for its inaction to tame surging onion prices. “The government is acting as mute spectator even though people are forced to pay higher prices for onion,” Prem Lal Maharjan, president of Forum for Protection of Consumer Rights, said. “Retailers are also keeping higher profit margin, taking advantage of short supply in the market. The government should look into it.”

Source: https://myrepublica.nagariknetwork.com/news/onion-prices-spike-on-short-supply/