Retail prices of onion fell Rs 5 to Rs 55-60/kg in metros across the country on Sunday, taking cues from wholesale markets, where prices have been on the decline due to increased supply and raids on hoarders.
Wholesale price of onions declined by Rs 3/kg to Rs 40-47 in Delhi, Mumbai, Kolkata and Chennai on Sunday, according to reports from these centres.
Traders attributed the fall in wholesale rates to increased supply from Gujarat, Maharashtra and Rajasthan, besides raids by the Income Tax Department on hoarders across the country.
Though the retail prices of onions declined on Sunday, they are still high compared to the going rate of Rs 25-30/kg in the first week of January last year, according to official data.
During the past two days, IT authorities have raided the premises of onion traders in Delhi and other parts of the national capital to check hoarding and illegal profiteering.
However, retail prices of onions remained unchanged at Rs 60/kg in Delhi and Mumbai on Sunday, but in Chennai and Kolkata, prices of the vegetable declined Rs 5 vis-a-vis Saturday's levels, to Rs 60/kg and Rs 55/kg, respectively, according to reports.
However, in posh colonies of metros, retail prices continued to rule at over Rs 70/kg.
"The wholesale prices have started cooling off in the last three days due to increased supply from the key growing states and IT raids on traders," Rajendra Sharma, the General Secretary of the Tomato and Onion Merchants' Association in Delhi's Azadpur mandi, said.
The impact of the fall in wholesale rates on retail prices of onions will gradually be seen from next week, as supplies are expected to further increase, he added.
India's onion output is expected to decline by 12.5 per cent to 10.5 million tonnes this year, against 12 million tonnes in 2009-10, on account of damage to crops caused by abnormal rainfall.