Skyrocketing onion prices may ease after Diwali: Govt

Onion prices continued to reign at as much as Rs 100 a kg in major cities, with the government indicating that rates may start falling after Diwali and some states taking their own initiatives to ease the situation.

Blaming hoarding for the price rise, Food and Consumer Affairs Minister K V Thomas asked traders not to "loot" consumers. He also said there was no need to be "alarmed" about the crisis as prices would cool down in the next 10 days with improved arrivals from the domestic and overseas markets.

"Onion prices will come down in next 10 days. Traders should take legitimate margin and not loot consumers. Farmers should get reasonable price and consumers should also get onions at affordable rates," Thomas said at an event here.

The Cabinet Secretary reviewed the onion price situation, but sources said no major decisions were taken. The Agriculture Ministry took stock of the crop situation in producing states via video conferencing.

A team from poll-bound Delhi reached Maharashtra to procure cheaper onions, while the West Bengal government has made arrangements to sell onions at lower rates.

As per reports from centres, retail prices continued at Rs 60-90 per kg in major cities, depending on location and quality. In Delhi, prices were at Rs 80-100 per kg.

However, official data showed the average retail price in 57 major cities stood at Rs 75 per kg today.

State governments have been asked to take strong action against hoarders and a few states have already acted, he said.

Prithviraj Chavan, Chief Minister of Maharashtra, the country's largest onion producer, ruled out any hoarding in the state and said the situation would improve from next month with higher arrivals of fresh crops.

Thomas said he discussed the supply situation with the Maharashtra, Rajasthan and Karnataka governments and onion arrivals are improving.

"Nafed has floated a tender (to import onion) and the decision will be taken on Oct 29. After the decision, onions will arrive in 3-4 days," the minister said.

"Our analysis is that production is as good and even better than last year but the prices have remained higher," he said.