The importers then stopped bringing onion to Shyambazar for three days, which Anwar says played a role in the supply squeeze to the kitchen markets in the capital leading to the price hike.
“It had affected the markets across the country then,” the importer said.
And when prices reached Tk 180 a kg in Dhaka after the three-day deadlock at Shyambazar, the trader in Khulna who bought Anwar’s onion at Tk 110 a kg sent the products to the capital, the importer said.
This is how Anwar sees the turbulence was created in the onion market as he blames the traders’ decision to fix wholesale prices for the hike.
The government has now decided to start flying in onions from Turkey and Egypt and continue the process until new produces from the Bangladesh farmers and shipment of consignments through the sea arrive.
“The situation has reached such a point that the government is importing onion itself for the first time,” Commerce Secretary Jafar Uddin told bdnews24.com on Friday.
For the soaring prices after a drop in production in the South Asian region due to bad weather, related people point to various factors from dishonesty of some traders to a lack of timely government action to find alternatives.
The onion prices have continued to skyrocket since Sept 29 when India banned onion export to control domestic markets.
The Financial Times reported on Thursday that the Indian government itself pledged to import onion after prices increased 500 percent from the start of the year.
In Dhaka, onion prices rose to Tk 240 a kg from Tk 45-50 in September.
“But there will be no outcome from these analyses now,” he added, expressing frustration over the situation.
An importer based in Shyambazar, requesting anonymity, said the traders had warned the government in a meeting in August of the possible volatility in the market by the end of the season following a drop in production due to rainfall.
But the government had not taken any step as it had suspected the businesses had wanted import facilities to make profit for themselves, the trader added.
On being asked about the issue, Secretary Jafar, who joined commerce ministry in mid-September, said, “The traders had not gone for big imports from other countries as everyone had thought India would lift the export ban after Durga Puja and prices would fall.”
Another importer, Haji Abdul Majed, and ‘Manik’, who manages Amanat Bhandar at Shyambazar, alleged that a group of traders were making “huge extra profits dishonestly”.
These “dishonest” traders imported onion from Egypt at Tk 40 a kg, but was selling at Tk 130-140 a kg as the prices of onion from other countries like Myanmar and Turkey soared.
The commerce secretary said different government agencies fined and jailed more than 2,000 traders in past two months for creating an artificial crisis of onion in the market.
“But the situation had improved only a little afterwards. Actually it’s a market trend. We are frustrated as well,” he said.
Golam Rahman, chairman of the Consumers’ Association of Bangladesh, said the government should have reviewed the market properly to make plans for such situations.
“The people’s economic capacity is rising day by day, so their purchase power is also rising. These things should be kept in mind while assessing the demand of onion.
Bangladesh produces 1.7 million to 1.9 million tonnes of onion annually and imports 700,000 tonnes to 1.1 million tonnes to meet the domestic demand, according to the government.