Onion prices rise in Bangladesh

Importers looking for alternative markets of onions prices rise

After India extended its restrictions on onion exports, the local market witnessed a surge in onion prices rise. The halt in a major source of onion imports led to the exploration of alternative countries for procurement. However, these alternative markets also experienced onion price rise due to India’s imposed restrictions.

After India prolonged its onion export limits, local onion prices rises. With a major source of onion imports blocked, other countries were sought for supplies. However, these alternatives also saw onion price rises due to India’s restrictions.

The Department of Commerce stated that these export limits would stay until March 31.

India extended onion export limits for three months to steady prices and boost local supplies. The Commerce Department confirmed these restrictions until March 31. Despite early onion harvests in the southwest, storage limits and low production pose challenges.

Agricultural officials observed early onion marketing due to good prices for farmers. Expected new onion arrivals should increase supply soon, but demand still relies on imports. Myanmar is the closest alternative to India, with potential arrivals within a week. In contrast, sources like Pakistan, Egypt, China, and the Netherlands take 13 to 30 days via sea routes.

The country’s Department of Commerce announced that these export restrictions would be in effect until March 31.

India’s decision to extend the export restrictions on onions for three months aimed to stabilize onion prices rise and enhance local market supplies. The country’s Department of Commerce announced that these export restrictions would be in effect until March 31. Despite the early harvest of onions (murikata) in the southwestern region, their limited storage capability and lower production levels remain a challenge.

Surge in Onion Prices in Bangladesh

Officials from the agricultural extension department noted the commencement of early onion marketing due to favorable prices for farmers. Anticipated new onion arrivals are expected to bolster supply in the market soon, although demand continues to require imports. Myanmar stands as the closest alternative to India for onion imports, with a potential market arrival within a week, unlike other sources such as Pakistan, Egypt, China, and the Netherlands, which require 13 to 30 days via sea routes.

Onion prices rise in Bangladesh
Onion Market 10 December 2023.

Onion Challenges in Southwest

Despite early onion harvests (murikata) in the southwest, challenges persist due to limited storage and lower production levels.

Disruption in Myanmar

Ongoing clashes between armed groups and security forces in Rakhine, Myanmar, disrupted onion imports via land ports since November 14. Limited-scale imports resumed on December 5, but the situation remains uncertain.

Importer Dilemmas

Importers, like Faruk Traders in Teknaf, confirm Myanmar’s readiness for onion exports but cite government reluctance due to ongoing unrest. Alternative sources (Turkey, Pakistan, China, Egypt, and the Netherlands) require identification of suppliers and approval from agricultural departments.

Dollar Shortage and LC Challenges

The challenge continues in initiating the Letter of Credit (LC) process due to a shortage of dollars. Since India set the export price at USD 800 per tonne on October 29, limited-scale imports began from China and Pakistan. For onion prices rise in bangladesh.

Deputy Director Mohammad Shah Alam from the plant quarantine station at Chattogram port mentioned importing 830 tonnes of onions from China and Pakistan since November 26. Importers explore diverse markets, anticipating price fluctuations. Faruq Ahmed, a proprietor, highlighted the escalating cost of importing onions from China, rising from USD 280 to USD 380 per tonne after India’s restrictions.

Search for Alternatives

Four years ago, India suspended onion exports, prompting major importers like Meghna Group of Industries, BSM, S Alam, and City Group to seek alternatives. BSM Group chairman Abul Bashar Chowdhury suggested Myanmar as a potential beneficial source for quicker imports, along with options from China, Pakistan, Egypt, and Turkey, emphasizing the need to initiate LC for onion imports.

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