India sees surge in onion prices ahead of Kharif harvest

India is currently grappling with a significant rise in onion prices, with costs climbing to as high as $1.21 per kilogram in some areas. This price spike is largely due to the absence of government regulations on retail pricing. A potential reprieve is on the horizon, though, as the Kharif onion harvest is expected to reach markets within the next two weeks.

Ajit Shah, president of the Fruit and Vegetable Exporters Association, has pointed out that the lack of oversight in retail markets allows sellers to hike prices unchecked. Meanwhile, senior agricultural expert Parashram Patil has drawn attention to the role of middlemen and insufficient urban storage infrastructure in aggravating the situation.

In Lasalgaon, Maharashtra — a major onion trading hub — Rabi onions are being sold at $70.58 per quintal (100 kilograms), while Kharif onions are priced at a lower $43.41 per quintal. In the National Capital Region, retail onion prices have risen from $0.60–$0.72 per kilogram to $0.84–$0.90 per kilogram. To provide relief to consumers, the government has started selling onions through cooperatives at a subsidized price of $0.42 per kilogram.

Transportation expenses add further pressure, with about $0.12 per kilogram spent on moving onions from Nashik to various regions, according to M. Madan Prakash, president of the Agricultural Exporters Association. Concerns have also been raised about the lack of transparency in the onion trade and the influence of intermediaries, which have further inflated retail prices.

Market observers have criticized speculative activities and overstated claims of crop losses, which they say have unnecessarily driven prices higher. While the government has imported over 2,400 tons of onions to stabilize the market, challenges in distribution and maintaining quality standards remain.

A significant decrease in prices is anticipated with the arrival of the Kharif onion harvest, which is projected to be robust this year. The Ministry of Agriculture has reported an expansion in the area under Kharif onion cultivation, which could help address the supply shortages. However, persistent supply chain issues and lack of transparency in the market may continue to influence prices in the short term.