Onion prices remain high at Rs 100/kg; crisis to continue

Onion prices continued to rule at a record Rs 100 per kg in parts of the country for the second day today as a hapless government waited for increased supply of new crops to reach the markets and stabilise rates.

Union Agriculture Minister Sharad Pawar today again termed the crisis "temporary," even though onion prices have been rising since August. However, poll-bound Delhi Chief Minister Sheila Dikshit said the situation was "very serious" and indicated her government will step in to try and rein in the situation.

Also Read: Supply-side issues responsible for high onion prices: PMEAC

With Delhi having a history of incumbent governments losing elections when onion rates are abnormally high, Dikshit petitioned Pawar and Food Minister KV Thomas for urgent steps to boost supplies and control rates. Reports from Delhi, Mumbai, Patna and Chandigarh said the staple commodity was ruling between Rs 90-100 per kg, while in most other cities, onions were sold at Rs 70-80 per kg.

According to data compiled by the Consumer Affairs Ministry of 57 major cities, average onion prices rose by Rs 5 to Rs 75 per kg, with the maximum increase of Rs 90 per kg in Jammu. Pawar said onion prices are expected to cool down in the next 2-3 weeks with increased arrival of new crops from Maharashtra, Karnataka and Rajasthan.

"Onion shortage is a temporary situation. Heavy rain has affected crops in Karnataka and Maharashtra. Total area under the crop is higher than last year. No drop in production is expected," Pawar told reporters. "Production is good. The question is when the crop will come in a big way to the markets," he said.

Commerce Minister Anand Sharma said there is no "real" scarcity of onions and prices are expected to stabilise in the coming few weeks. He blamed hoarding and crop losses for the high price, not exports.

Dikshit said her government will approach the Election Commission to restart the sale of onions through mobile outlets and vans of the state government in the city, which goes to the polls on December 4. A team has been sent to Maharashtra to get more supplies.