Govt Anticipates Onion Prices To Reduce Below Rs 40 Per Kg By January

The Consumer Affairs Secretary, Rohit Kumar Singh, noted that onion prices are expected to fall from the current average price of Rs 57.02 per kg to below Rs 40 per kg next month. 

Notably, onion inflation in the Consumer Price Inflation (CPI) basket has remained in double digits since July, increasing to an almost four-year high of 42.1 per cent in October.

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The government anticipates a fall in onion prices to below Rs 40 per kg by January, Consumer Affairs Secretary, Rohit Kumar Singh, said on Monday. The official noted that onion prices are expected to fall from the current average price of Rs 57.02 per kg to below Rs 40 per kg next month. 

Last week, the government banned onion exports until March 2024 following the prices of the staple commodity crossing Rs 80 per kg in the national capital and the mandis hovering near Rs 60 per kg, reported PTI. 

Responding to a query about the fall in onion prices below the level of Rs 40 per kg, Singh said that it would happen very soon in January. “Somebody said it will touch Rs 100 per kg, we said it will never cross Rs 60 per kg. So, all India average is now Rs 57.02 per kg this morning and it will not cross Rs 60 per kg,” the official stated on the sidelines of the Deloitte Growth with Impact Government Summit’.

 The export ban would not impact the farmers, and a small group of traders are the ones who are exploiting the difference between the prices in Indian and Bangladesh markets, and “They will lose. But who will gain, is the Indian consumer,” Singh added. 

Notably, onion inflation in the Consumer Price Inflation (CPI) basket has remained in double digits since July, increasing to an almost four-year high of 42.1 per cent in October. The onions exported between April 1 and August 4 in the fiscal year stood at 9.75 lakh tonns. The top three importing nations in terms of value were Bangladesh, Malaysia, and the UAE.

Before banning the exports, the Indian government decided in October to enhance the sale of buffer onion stock at subsidised prices of Rs 25 per kg in retail markets to help provide some relief to the consumers. Further, to keep a tab on prices, the government undertook various measures. These included levying a Minimum Export Price (MEP) of $800 per tonne on onion exports on October 28 till the end of 2023. Earlier in August, India imposed a 40 per cent export duty on onions till December 31, 2023.