New Delhi : Wholesale onion prices at Nashik dropped to Rs 4.70 a kg today, the lowest level so far in this financial year, as supplies continued to rise and exports were expected to decline.
Prices at Nashik, which sets the market trend for onions in the country, had peaked at Rs 100 per kg in the third week of October.
“In the last month or so, onion prices have crashed as markets were already full with the kharif onion and now, late kharif crop has been coming in,” R P Gupta, Director of the National Horticultural Research and Development Foundation, said.
He said the price of Rs 4.70 per kg was the lowest for onions in the current financial year.
Traders say prices are subdued also because export shipments are likely to decline.
Overseas shipments are expected to come down by 10-15 per cent due to lack of demand abroad as onions from other countries fill the markets, trader Ajit Shah said.
During April-December, onion exports dropped 30 per cent to 9.87 lakh tonnes from 14.04 lakh tonnes in the same period a year earlier. India exported 18.22 lakh tonnes of onions in 2012-13.
In the last week of December, the government slashed the minimum export price of onions to USD 150 a tonne from USD 350 to help overseas sales. It was the third downward revision of the benchmark price, below which the commodity cannot be exported.
The first reduction was on December 16, when the Centre cut the minimum export price to USD 800 a tonne from USD 1,150. Three days later, the price was lowered to USD 350 a tonne.
The government had imposed the minimum price to discourage exports and boost domestic supplies after a sudden and sharp hike in onion prices across the country starting in July.
Onion prices started to decline after October, when the average was Rs 50 a kg, according to NHRDF data. They fell further to Rs 29.83 per kg in November and to Rs 13.34 a kg in December. For most of January, onion prices hovered at about Rs 9 a kg.