Onion prices fall in Bengal as exporters divert Bangladesh-bound trucks to local markets

With the Centre imposing a ban on the export of onions in the wake of a steep price rise across states, especially that of the Nasik variety, many exporters have started diverting trucks headed for the Bangladesh border to the wholesale markets of West Bengal.

As a result, retail prices on Friday came down from Rs 40 to 35 in Kolkata and from Rs 35 to 28 in Siliguri, north Bengal’s biggest town.

Uzzal Saha, general secretary, West Bengal Exporters’ Coordination Committee, said, “Hundreds of trucks, loaded with onions meant for Bangladesh, are stranded for five days at the state’s six land ports in Malda, North Dinajpur, Cooch Behar, Jalpaiguri and North 24 Parganas districts. On an average a truck carries 25 metric tonnes of onion. The sacks lying at the bottom of the piles have started to rot. We fear that 10 per cent of the total consignment might be lost.”

On September 14, the Director General of Foreign Trade (DGFT) under the Union ministry of commerce and industry issued a notification, stopping export of onion to foreign countries.

“On September 15 we wrote a letter to the DGFT, saying exporters are having difficulty executing the order since many consignments are sent against letters of credit issued by banks of the importing countries. It is difficult to divert these consignments to local markets as that would be breach of commitment,” said Saha.

“We have requested the government to at least allow those trucks that reached the border before September 14 to leave the country,” said Saha.

Rabindranath Koley, member of the West Bengal government’s task force on essential commodities, which is monitoring the price rise, said, “Consignments not issued against a letter of credit are being diverted to local wholesale markets by the exporters. This has brought down the prices. I went to a Kolkata market today and bought onions for Rs 35 a kilo. The price was Rs 40 earlier this week.”

“Wholesale price used to be Rs 1200 a sack. That has come down to Rs 1100,” added Koley.

In Siliguri, the town’s regulated market is the biggest in the region. Ram Avtar Prasad, an onion wholesaler, said, “Retail prices ranged between Rs 33 and 35 a week ago. Now it is varying between Rs 28 and 30.”

“This has happened because after the ban on export was announced, several exports in Nasik, Indore and other big markets diverted their truck that had already reached Bengal to the local markets,” added Prasad.