Traders are making superprofits in the onion trade
The wholesale traders in Delhi bought onions at about Rs 34 per kg while it was sold in retail at Rs 80 per kg.About 11,445 quintals of onion was bought in the Delhi wholesale markets on that day. So the total difference between what the wholesale traders paid and what Delhi households paid from their pockets would be over Rs 4 crore. Speculative traders are making superprofits by fixing price in the onion trade. That’s a margin of Rs 46 per kg or 135% profit margin.
This story is not confined to Delhi alone. In 44 major onion markets across the country, profit margins for just one day were of similar orders ranging between Rs 1,500 per quintal in Pune and Rs 5,500 in Udaipur. Multiply these with the daily arrivals of onions in each and you get the gigantic amounts fleeced from consumers every day — in Bangalore over Rs10.5 crore; in Mumbai, Rs 81.4 lakh; in Kolkata Rs1.3 crore; in Chandigarh over Rs 32 lakh, and so on.
Wholesale price data are collected daily by the National Horticultural Research & Development Foundation (NHRDF), set up by NAFED, the farmers’ cooperative federation run by the government. Agriculture minister Sharad Pawar has said it may take 2-3 weeks for prices to come down. At the rate at which hard-earned money is being transferred from people to traders, that is enough time for hundreds of crores of rupees to be thus redistributed.
Of course, between the wholesaler buying the onion and the retailer reaching it to your doorstep or local market, there are transport costs, some wastage and so on. But this can at best be a minuscule fraction of the 135% margin, particularly for a commodity like onion that is not easily perishable.
According to traders, rains have curtailed supply and hence prices have gone up but they had no explanation for the fact that the official rate at the wholesale market was Rs 34.90 per kg and not Rs 70-80. In December, Delhi received 2.57 lakh quintals of onion compared to about 3.8 lakh quintals in 2009 and just 1.5 lakh quintals in 2008.
HOPCOMS Bangalore brought down the price to Rs. 72 on Wednesday from Rs. 78 on Tuesday. However, onion was sold in markets in Basavanagudi, N.R. Colony and Basaveshwara Nagar at Rs. 35 a kg. In Hubli, angry over the sudden crash in price, farmers, who had brought onion to the market expecting a good price, blocked the old national highway between Hubli and Dharwad for two hours.
- Source: Times of India, The Hindu
Bangalore, Basavanagudi, New Delhi, Onion Prices, Onion prices in the Capital, Onion trade in the Capital, Onion Trade profit margin, super profits in onion trade, wholesale traders fixing onion price
