Rain damage to standing crop in Nashik district causes steep rise in onion prices

Traders from Lasalgaon, who hinted at indefinite closure of their market following raids by income tax officials, were also back in business on Monday.

Escalating onion prices have caught the government’s attention with several measures being put in place to control the same. Exports were banned earlier in the year even as the central government amended the Essential Commodities Act, 1955, to delink onions, potatoes, pulses, oilseeds, and edible oil from the purview of the Act, on September 22. Ban on exports did not have a desired effect as prices continue to rise with market sources saying the destruction of kharif crop in Karnataka due to heavy rain in September was the main reason for the price rise.

Deshmukh and other traders said while the present price hike would continue till the end of November, the arrival of the new kharif crop was expected to be delayed.

Since the past two days, Nashik has reported heavy rain that has damaged the standing onion crop in the district. “Farmers from Kalwan, Malegaon have reported heavy losses to crop that was to be harvested in the next few days,” Deshmukh said, adding that the crop would now arrive towards the end of November or early December.

In the run-up to Diwali, onion prices are expected to rally further as demand from north Indian markets like Delhi and Punjab is expected to further rise. “We expect onion prices to cross Rs 100 per kg mark in some time,” traders said.

Unavailability of imported onions has also hit the domestic markets. The few containers from Iran arriving at the Mumbai port are headed straight to south Indian markets, where they are mainly used by hotels and catering sectors.