Price of onions have surged in India after the government removed the minimum export price (MEP) and allowed domestic traders to ship out all varieties.
The average wholesale onion prices at Lasalgaon, the country’s largest wholesale market, shot up by 46 per cent on Monday after the MEP was removed.
The average wholesale onion prices increased to Rs 2,075 per quintal as against Rs 1,451 per quintal on Friday. The minimum and maximum prices were recorded at Rs 1,000 and Rs 2,200 per quintal on Monday after around 15,000 quintals were auctioned at Lasalgaon.
Onion prices are expected to soar in the retail markets as well.
Back in November, the government had imposed an MEP of $850, or Rs 54,000, a tonne. Such limits are imposed every now and then to discourage foreign traders from buying at a time when lack of supply lifts prices beyond a certain limit.
However, traders had complained they were already fighting heavy competition abroad from producers in Egypt and Pakistan. India is the second-largest producer of onions after China but is also among the largest consumers. The MEP decision had been taken after the price had risen to its highest in two years.
Retail prices across major cities had been Rs 40-50 a kg. From there, prices had recently crashed as supply entered the market. Friday’s move might also have been a response to that, a sector insider said.