The study will find out the quantity of onion required for import and if a “seasonal tax” could be imposed on import
The commerce ministry, for the first time, has started a field study to assess production, cost, and market prices of onion in the country as India will lift its export ban on March 15.
The field study will find out the quantity of onion required to import and if a "seasonal tax" on import could be imposed to ensure fair prices for the local farmers.
"Neighbouring India is lifting the export ban on onion when the local onions are hitting the markets. An extra or badly timed import may deprive the Bangladeshi farmers of fair prices," said the commerce ministry officials.
Commerce ministry tasked the Institute of Cost Management Accountants of Bangladesh (ICMAB) with the field study.
"We assigned our teams to collect data on production, production costs, stocks, and market prices of onions from the farmers," the ICMAB President Md Jasim Uddin Akond told The Business Standard.
The institute will recommend the commerce ministry to temporarily suspend or impose a seasonal ban on import of the bulb if this year's production seems sufficient.
Onion prices skyrocketed in Bangladesh following India's export ban last September. So, Bangladesh started importing the bulb to calm down the market.
The soared prices finally started to go down as locally grown onions hit the markets in February. The price of the cooking essential went down further to Tk45-60 per kilogram as India announced lifting the ban on export.
The local onion price was Tk100 per kg even three weeks ago. The Indian government did not set the minimum price for onion export owing to a bumper yield of the crop this year.
"Discussions between the Bangladeshi and Indian onion traders signal that the price may fluctuate between $260 to $280 per tonne," said Shankar Chandra Ghosh, a Shyambazar-based trader, and importer.
"Business people in both countries are ready to trade onion as soon as the ban is lifted. Import will bring the local onion market back to normalcy."
Though onion price is dropping rapidly in Dhaka's wholesale markets, it is still high compared to that in the retail ones. Per kg onion cost Tk25-30 at Syambazar wholesale market while Karwanbazar retailers were selling it at Tk50-55 per kg on Thursday.
The price varied depending on onion quality, retailers said, adding that premium quality and medium-size onions were being sold at Tk55 a kg, and the smaller ones were being sold at Tk50.
However, imported onions from Myanmar and Egypt were sold at Tk60 to Tk80 per kg.