Govt expects onion prices to reduce below Rs 40 per kg by January

Digital Desk: The government expects onion prices to drop to less than Rs 40 per kg by January, Consumer Affairs Secretary Rohit Kumar Singh stated on Monday. According to the official, onion prices are expected to drop next month from their current average of Rs 57.02 per kg to less than Rs 40 per kg. 

Due to the prices of the staple good exceeding Rs 80 per kg in the nation's capital and the mandis hovering at Rs 60 per kg, the government last week barred onion exports till March 2024, according to PTI. 

In response to a question concerning the expected drop in onion prices below Rs 40 per kg in January, Singh stated that it would happen very soon. "We stated it would never cross Rs 60 per kilogram, but someone else predicted it would reach Rs 100 per kg. Thus, the average price per kg throughout all of India is currently Rs 57.02 this morning and is not expected to exceed Rs 60 per kg," the official said on the fringes of the Deloitte Growth with Impact Government Summit.

The export prohibition won't affect farmers; instead, a select few dealers who are taking advantage of the disparity in prices between Bangladeshi and Indian markets would suffer losses. However, Singh says that the Indian customer will benefit.

 

Significantly, since July, onion inflation in the Consumer Price Inflation (CPI) basket has stayed in the double digits, reaching a nearly four-year high of 42.1% in October. 9.75 lakh tons of onions were exported during the fiscal year that began on April 1 and ended on August 4. When it came to value, Bangladesh, Malaysia, and the United Arab Emirates were the top three importing nations.

 

In an effort to provide customers with some respite, the Indian government agreed in October to increase the sale of buffer onion stock in retail marketplaces at discounted rates of Rs 25 per kg. 

Additionally, the government implemented several policies to monitor prices. One of these was imposing a Minimum Export Price (MEP) on onion exports starting on October 28 and continuing through the end of 2023 at $800 per tonne. India levied a 40% export tax on onions till December 31, 2023, earlier in August.