Onions are being bought from farmers to be stored and sold at a premium price during the off season.
The trend is causing the current price of onions to rise.
“The prices have gone up within a short time,” said Narayan Saha, proprietor of Nobin Traders, an onion wholesaler at Shyambazar market in the capital.
The spike was influenced by the stockists’ purchasing spree, he said.
Traditionally, large farmers and a section of people at growing regions invest in freshly harvested onions so that they can profit from selling bulbs at higher prices during the off-season.
“This practice has been going on for decades. I have been witnessing this business since my childhood,” said Gobinda Saha, a trader and stockist at Rajbari, one of the major growing districts.
The supply has reduced because of increased stocking, he said. A large portion of onions have already gone towards stocking, said Md Aminul Islam, a wholesaler at Sathia, another growing district in northwest Pabna. “Stockists sometimes offer higher prices than us to grab onions,” he said.
Bangladesh consumes 20 lakh tonnes of onion a year but it has to rely on imports due to inadequate production. Onion acreage and production have been on the rise since 2013-14 because of growers’ renewed interest. But yields still are not enough to meet the demand.
Onion production grew 2 percent year-on-year to 17.35 lakh tonnes in fiscal 2016. It was grown on 1.77 lakh hectares that year, according to Bangladesh Bureau of Statistics.
The prices of the locally grown finest quality onion bulb have shot up to Tk 25 a kilogram from Tk 20 per kg two-three weeks ago in the growing districts.
The vegetable traded between Tk 22-Tk 23 each kilogram at haats, up from Tk 15-Tk 17 two-three weeks ago, according to onion wholesalers. In Dhaka, retailers were selling onion, a key cooking ingredient, for as high as Tk 35 per kilogram on Tuesday, in contrast to Tk 28 a week ago.
In Dhaka, imported onions sold at Tk 22-Tk 26 each kg yesterday from Tk 20-Tk 22 a week ago.
The locally grown ones sold at Tk 28-Tk 32 per kg at the retail level on Tuesday from Tk 24-Tk 28 a week ago, according to the Trading Corporation of Bangladesh. However, the prices are still lower than a year ago, TCB data showed.