UAE | General

No shortage of onions despite poor crop in India

Onions may cost more ahead of Eid as the Government of India has suspended fresh exports of the commodity for the next 15 days in the wake of soaring domestic prices.

  • By Binsal Abdul Kader, Staff Reporter
  • Published: 23:52 October 3, 2007
  • Gulf News

Abu Dhabi: Onions may cost more ahead of Eid as the Government of India has suspended fresh exports of the commodity for the next 15 days in the wake of soaring domestic prices.

Wholesalers and retailers in the UAE said the Government of India's decision will create a shortage of the commodity and hike the price here.

The export of onions from India will not be permitted until October 15. Alok Ranjan, Managing Director of the National Agricultural Cooperative Marketing Federation of India Ltd (NAFED) told the Hindustan Times Newspaper: "It is not a ban but could be called a temporary suspension."

Heavy rain in India's onion producing states have caused the shortage, a NAFED spokesman told Gulf News on the phone from New Delhi. He said the situation is expected to be back to normal by the middle of this month when crops from the seasonal harvest reach the market.

Steps

There is already a shortage of onions in the UAE market, said a wholesale dealer in Dubai's Aweer Market, hence wholesale price have gone up. They have been increased to Dh2,203 per tonne now from Dh734 to Dh771 per tonne during April and May this year, said Sunil Kumar .K, Manager, Abdullah Al Khatal General Trading at Aweer Market.

"About 500 tonnes of onions from India used to be sold daily in Dubai's wholesale market which is the hub of the GCC market."

The lack of supply from an alternative source, Pakistan, because of a crop failure due to hostile climatic conditions in producing areas, has worsened the situation, they added.

But major retail outlets claimed that they have taken steps to retain the regular supply and the "temporary phenomenon" will not affect their prices immediately.

Prices have not been increased at moment

Statistics issued by the Ministry of Economy shows that onions from India cost Dh1.90 to Dh3.90 per kilo at major retail outlets. But some retail outlets told Gulf News they have put promotional prices in place for Ramadan as low as Dh1.75 per kilo. They claim they have not increased prices thanks to long-term contracts with their suppliers. But they said they cannot predict future prices if an acute shortage grips the market.

Interestingly retail prices in India are higher than the minimum price in the UAE. Market sources said major suppliers got stocks of onions during the last season in April and May this year. "Some businesses have made long-term contracts with Indian exporters who regularly stock the commodity to overcome temporary fluctuations," said a wholesale dealer.

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