Onion price crosses Tk 100 amid supply crunch
Onions were selling at Tk 80-90 per kg during the Eid-ul-Azha, and it now ranges from Tk 100 to 110, marking a rise of Tk 20 in just fifteen days
Onion prices have crossed the threshold of Tk 100 per kilogram (kg) due to what the traders say shortage in the supply of local varieties and decline in imports from neighbouring India.
Each kg of onion was selling at Tk 100 to 110 at different kitchen markets in the capital city on Wednesday, while prices of other daily necessities were also significantly higher.
Green chillies were selling at over Tk 250 per kg, and broiler chicken eggs were priced at Tk 150-160 per dozen. Some vegetables also experienced hikes in their prices due to recent rains.
Inflation has remained above 9 per cent throughout the last 14 years, mainly due to the higher prices of daily essentials. Food inflation has particularly been burdensome for people.
The Bangladesh Bureau of Statistics (BBS) estimated the overall inflation in May at 9.89 per cent, with food inflation at 10.76 per cent.
Price hikes by Tk 20 in two weeks
While visiting kitchen markets at Shewrapara, Taltala, and Karwan Bazar in Dhaka, local onions were seen to sell at significantly higher prices compared to previous two weeks.
Retailers said they began the onion season this year with high prices. In February, newly harvested onions were priced at Tk 80-100 per kg, and it rose to Tk 120 in March. The price dipped slightly in April, but regained the rising trend shortly.
We are in a helpless situation due to the surge in prices
Onions were selling at Tk 80-90 per kg during the Eid-ul-Azha, and it now ranges from Tk 100 to 110, marking a rise of Tk 20 in just fifteen days. Traders revealed that the prices have soared by Tk 10 in the last three days.
Wholesale traders said consumers turned to local onions increasingly as imports from India were suspended for four to five months. The neighbouring nation has recently allowed onion exports, but placed a 40 per cent duty, elevating the import costs.
Moreover, the imported onions now cost higher than the local variety as the price has soared in India too, they added.
Abdul Majed, a wholesale trader at Shyambazar in Dhaka, said a reduced amount of onions are now being imported from India.
Average price over Tk 80
According to the Department of Agriculture Marketing, the price of local onions usually remains below Tk 40 during the peak season. But the prices have been unusually high this year.
The government agency, Trading Corporation of Bangladesh (TCB), estimated that onions were sold at Tk 45-60 per kg even during the peak season in April.
Expressing disappointment over the market scenario, Sajidul Islam, a private service holder, said he used to buy onions at Tk 40 per kg, but now has to pay more than double the price. “We are in a helpless situation due to the surge in prices."
The department of agricultural marketing noted that the country's annual onion demand is nearly 3 million tonnes, with one-third met by imports.
The department of agricultural extension estimated that around 3.5 million tonnes of onion were produced in the fiscal year 2022-23, which is slightly less than the preceding year’s 3.6 million tonnes.
It indicates that the country is producing more onions than its demand, and there should be no shortage in the market.
Golam Rahman, president of the Consumers Association of Bangladesh (CAB), said supply disruption may lead to increased prices of commodities. But the main problem is inflation as it has reduced the people's purchasing power without a corresponding rise in income.
As a result, consumers are struggling to afford high-priced commodities, he said, adding the authorities should focus on reducing inflation and increasing people's income.