Onion prices drop by Tk10 per kg in wholesale markets after import announcement

Onion prices in Dhaka's wholesale markets have fallen by at least Tk10 per kilogram within two days of the government's decision to allow imports in an effort to curb the recent price surge.

Traders say wholesale sales have dropped sharply since the announcement on Tuesday (12 August), with many retailers halting purchases.

At Shyambazar, one of Dhaka's largest wholesale hubs, onions were selling today (14 August) for Tk62-Tk65 per kg depending on quality, compared to Tk75 two days ago.

Mohammad Abdul Majed, general secretary of the Shyambazar Onion Traders' Association, told The Business Standard, "For the past two days, there have been no buyers. Today, the market is almost empty as retailers stopped buying onions after hearing about imports."

He added, "Every year there is a 20–25% shortage of onions despite domestic production — something I have observed over the last 30-35 years. This year, local onions met demand for about seven to eight months. The problem starts when prices rise by Tk1-Tk2 per kg, as buyers then purchase double the quantity out of fear that prices will go up further."

In Karwan Bazar, wholesale prices have dropped by Tk5-Tk7 per kg, now selling for Tk70-Tk72, down from Tk75-Tk80 two days earlier.

"Sales have fallen since yesterday [13 August] after news of imports. Today, too, there's no significant demand. Although permission for imports has been given, it will take time for imported onions to arrive," said Babul Mia, a wholesale trader at Karwan Bazar.

Retail prices in Dhaka remain unchanged, with onions still selling for Tk80-Tk90 per kg. Two weeks ago, prices were Tk60-Tk65, and for a long period before that, Tk55-Tk60 per kg.

According to the Trading Corporation of Bangladesh, onion prices have increased by over 30% in the past month.

Agriculture ministry sources said the production target for last season was 3.8 million tonnes, but output exceeded 4.2 million tonnes. Post-harvest losses are estimated at 25-30%. Farmers' production costs last season ranged from Tk35 to Tk48 per kg.