The price of onions in retail markets across Bangladesh has surged from Tk25-35 to Tk80-90 per kilogram in the last 15 days.
Traders have given a multitude of excuses for this staggering price hike, such as shortage of supply and increased prices in the neighbouring country India. However, traders, market observers and the Commerce Ministry have made conflicting statements about the situation.
According to sources from the Ministry of Agriculture, Bangladesh has a demand of around 2.2 million metric tons of onions per year and its domestically produced 1.9 million metric tons of onions in the current year.
The shortage of onions should not have exceeded 300,000 metric tons. However, Bangladesh imported a total of 770,875 metric tons of onion from January 1 to October 17.
A Bangladesh Bank report says there should be a reserve of 470,845 metric tons of onions in the country at this time but the traders are claiming of an ongoing shortage of supply.
This situation has raised a question, where did 470,000 metric tons of onions go?
To discuss the sudden price hike of essential commodities such as onions, the Ministry of Commerce held a meeting last Monday.
The meeting, chaired by Commerce Ministry’s Additional Secretary Samina Yeasmin, was attended by representatives from the Bangladesh Bank, Bangladesh Tariff Commission, port authorities, Directorate of National Consumer Rights Protection (DNCRP) and ministries of finance, agriculture, home affairs.
During that meeting, representatives of respective organisaitons said the claims of a shortage of onions in Bangladesh are baseless as there is no evidence of a low reserve.
The reserve of onions should meet the market's demand for at least two more months and by that time the newly harvested onions will also reach the market, they added.
Meanwhile, two teams comprised of the Ministry of Commerce and DNCRP respectively had visited two kitchen markets --Shyam Bazar and Kawran Bazar-- in Dhaka.
The teams inspected onion supply, reserve and prices and submitted a report to the Commerce Ministry.
According to the report, there is no shortage of onions in the market and the supply is adequate to meet local demand.
However, when approached for comments on the recent price hike of onions, several government officials refused to address the issue.
Speaking on the matter, a trader from Dhaka’s Shyam Bazar Ariful Hauqe told the Bangla Tribune: “Onion prices have gone up in India because rain destroyed a lot of onions this season and this has led to a shortage of supply and caused the prices to surge.”
On the other hand, Commerce Ministry Additional Secretary Samina Yeasmin said: “As per our observation, there is no shortage of onions in Bangladesh and we have adequate reserves.
“We have recommended the high ups to monitor the markets.”
There are reports about the price of onions going up in India. The price of onions in India has increased from $271 to $341 per tons in a matter of a week.
According to an inside source from the Ministry of Agriculture, different varieties of onions are harvested over the course of a year, so there is no reason for the supply to drop in a particular season.
“Rain has destroyed onions in Bangladesh, causing prices to go up. However, the time for a new harvest draws close and the prices will come down soon,” Additional Secretary of Commerce Ministry Munshi Shafiul Haque told the Bangla Tribune.
This article was first published on Bangla Tribune.