The Trading Corporation of Bangladesh (TCB) will start open market sales of onions soon as it looks to hold back the runaway price of the essential cooking ingredient in recent days, said acting commerce secretary.
The move comes after traders raised the prices of onion by 25 percent or Tk 12.5 each kilogram, banking on India’s slapping of a minimum export price for the tuber.
The Indian authority slapped $850 (Tk 71,821) as minimum export price for per tonne of onion on September 13 to contain the price hike in its domestic market.
Since then, traders hiked prices all through the value chain and the key cooking ingredient was selling up to Tk 80 a kg at the retail level in Dhaka city, stretching the wallets of consumers.
But at Shymbazar, one of the main wholesale markets for onions, the imported tuber was trading at Tk 50-52 a kg yesterday, said an importer preferring to be unnamed.
“We are trying to start truck sales as early as possible to intervene in the market,” said TCB Chairman Md Hasan Jahangir.
As an immediate action, the TCB plans to buy from wholesale markets, particularly from markets in land ports -- Bhomra and Hili -- through which onions are imported.
“We cannot bring onion by opening letters of credits in such a short time. We need immediate action. We are trying to control the market.”
The TCB will initially intervene in Dhaka. Later, it will consider selling in the rest of the country, Jahangir said. The govern-ment will consider facilitating the import of onions from alternative sources such as Myanmar to contain the price hike, said Md Shafiqul Islam, secretary in-charge of commerce ministry.
The prices of locally grown onion have remained unchanged but some opportunistic retailers are asking for Tk 60 for each kg of Indian onions.
Given the high price of imported onion, many are opting for the locally grown one.
One such consumer is Ansarul Haque, who was startled yesterday by the high prices of Indian onion. After checking out the prices in four stores he finally settled on locally grown onion at Tk 65 a kilo at a store at Mohammadpur.
Onion is a key spice in Bangladesh, which produces less than its annual requirement.
The country has to import to 7-8 lakh tonnes of onions to cover the gap, said Mohammad Abdul Mazed, general secretary of Shyambazar Onion Aratdar (wholesalers) Association earlier.
Yesterday, 52 trucks, each carrying about 21 tonnes of onions, entered Bangladesh through the Bhomra port from India, said Ashadul Islam, manager of Sakib Enterprise, an onion importer at Bhomra, a major land port for onion import.
Onion was traded at Tk 50-55 a kg at Bhomra yesterday, up from Tk 45-Tk 48 on Saturday, he said.
Traders who had stock of previously imported onions made a bounty after India fixed the MEP to discourage exports.
It appears that those onions sold at Tk 45-Tk 48 a kg on Saturday even though they were imported at Tk 30-Tk 34, he said.
“It is true that all who had onion profited a lot in the last two days. However, traders suffer huge losses when the price plunge,” he said.
Commerce ministry holds meeting
Meanwhile, the commerce ministry yesterday took some decisions to cool down the skyrocketing prices of onion.
The margin for letters of credit will be lowered, onion importers will be given loans at lower bank interest rate and the consignments of onions waiting for release at the ports for long will be released on an urgent basis, said Islam. Commerce Minister Tipu Munshi is scheduled to hold a meeting with the business community tomorrow in this regard.