Ahmedabad: Onion, green chilli prices plunge amid low demand from hotels

AHMEDABAD: With a bumper crop and decline in bulk demand from restaurants and eateries, wholesale prices of onions and green chillies have come crashing down. In the Ahmedabad Agriculture Produce Market Committee (APMC), the wholesale price of onions declined from Rs 40 a kg ahead of the lockdown to Rs 12 a kilogram on Wednesday. APMC officials attribute the decline to decline in demand, coupled with unsold inventory and even a bumper harvest of the crop.
“Onion prices declined 50% against last year as consumption took a hit.About 20% of the stock of onions which arrives at the APMC is left unsold and as a result, the traders have started ordering less quantity of onions,” said a source at the APMC.

Similar is the case with green chillies, capsicums and tomatoes. “The demand for green chillies dropped by 30% and consequently, the prices too declined to settle in the range of Rs 12-30 per kg,” said a wholesale trader.
Traders have attributed the decline in price to the dropping of wholesale consumption at hotels, restaurants and eateries. “The hotel industry is completely closed due to the lockdown and despite relaxations by allowing takeaway orders, the business hasn’t resumed as much due to which the demand is very low. Moreover, this year, the production of onion has gone up by 10% against last year. Both these factors have contributed to the decline in prices,” said a trader.
When contacted, sources in the hotels and restaurants industry said that barely 20% of the restaurants have been able to resume operations through takeaway models and the order volumes too have drastically declined. As a result, the consumption of vegetables is bound to go down.
Officials at APMC Ahmedabad said that on Wednesday, barely 537 quintal of onions were traded against 1,800 quintals traded usually. “The dealers had enough stock of onions to meet the day’s demand and thus, only 336 quintals from Maharashtra and 201 quintals from Mahuva was procured,” said a senior official.