In Delhi, onions sell at dou­ble whole­sale rate

The Times of India (New Delhi edition) - - Front Page - [email protected] times­

Among In­dia’s eight largest met­ros, con­sumers in Delhi are the most short-changed by re­tail­ers of onions with mar­gins be­tween the whole­sale and re­tail prices be­ing much higher than other cities. The data also shows that a sud­den in­crease in prices does tem­po­rar­ily im­pact a re­tailer’s mar­gins, but they soon ad­just, though a fall in whole­sale prices is trans­ferred to the con­sumers af­ter a con­sid­er­able lag.

TOI an­a­lysed daily whole­sale and re­tail prices data col­lated by the Union con­sumer af­fairs depart­ment for Septem­ber 2019. Be­tween Septem­ber 1and Septem­ber 5, the whole­sale price of onions fell from Rs 20.75 to Rs 18 per kg in Delhi. Dur­ing this time, the low­est price range for the month, Delhi re­tail prices ranged from 102% to 117% over the whole­sale price.

The mark-up was be­tween 17% and 80% in Hy­der­abad, 20-70% in Chen­nai and 45-48% in Mum­bai. For Ahmed­abad, Kolkata, Pune and Ben­galuru, it was un­der 30%.

So what hap­pens dur­ing a price surge? Be­tween Septem­ber 15 and 16, whole­sale prices in Delhi in­creased by Rs 8.5 per kg. The av­er­age re­tail price for the first 15 days in Septem­ber was Rs 40 per kg while the av­er­age re­tail mark-up over the whole­sale price for this pe­riod was Rs 20 per kg. Be­cause of the sud­den in­crease in whole­sale price, the re­tail mark-up fell to Rs 14 per kg for Septem­ber 16 and17. In two days, the in­crease in whole­sale prices was trans­ferred to con­sumers and the re­tail price went up to Rs 52 on Septem­ber 18 from Rs 43 on Septem­ber15. For the next13 days, the re­tail price av­er­aged Rs 58 per kg, the mark-up av­er­ag­ing Rs 23 a kg, higher than in the pe­riod when prices were not this high.

In Mum­bai, the price surge hap­pened be­tween Septem­ber 19 and Septem­ber 21, when the whole­sale price in­creased from Rs 33.5 to Rs 44.5 per kg. For the 13 days till Septem­ber 21, for which both re­tail and whole­sale price data is avail­able for Mum­bai, the re­tail price av­er­aged Rs 41 per kg while the av­er­age re­tail markup was Rs 11.6 per kg. For the six days since then for which data is avail­able, the av­er­age







Re­tail mark-up from Jan 2016 to Aug 2019 (%)





re­tail price was Rs 58 per kg and the mark-up was up to an av­er­age of Rs 18.5 per kg.

Sim­i­larly, in Pune, the surge hap­pened be­tween Septem­ber19 and Septem­ber 23, when whole­sale prices reached Rs 36.33 from Rs 25 a kg. In the 19 days prior to and dur­ing the surge, the av­er­age re­tail price of onion was Rs 24.8 a kg and the mark-up av­er­aged Rs 1.6 per kg. For the seven days af­ter the surge for which data is avail­able, the av­er­age price was up to Rs 38 a kg and the mark-up rose to an av­er­age of Rs 7.7 per kg.

The other met­ros also ex­hibit a sim­i­lar pat­tern. In Ben­galuru, the whole­sale price reached Rs 44 a kg on Septem­ber 23


Max­i­mum and fell to Rs 40 on Septem­ber 25. The re­tail price was re­ported at Rs 48 on Septem­ber 21 and hasn’t fallen since. Sim­i­larly, in Chen­nai, the whole­sale price went up to Rs 35 on Septem­ber 24 and has fallen to Rs 24 since Septem­ber 26. The re­tail price on the other hand sta­bilised at Rs 37, which is higher than the pre-surge days. Hy­der­abad and Kolkata also had sim­i­lar trends.

Ahmed­abad is the only metro where re­tail mark-ups have stayed at Rs 2 per kg through­out the month even as whole­sale prices have risen. Whether this is linked to the city’s rel­a­tively lower con­sump­tion of onion is a moot ques­tion.

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