Onion import, production both surging

Farmers yielded the highest-ever amount of onion in the last fiscal year, more than the domestic demand, but the country still imported nearly as much of the essential cooking ingredient as it did in the previous year.

Bangladesh imported 4.93 lakh tonnes of onion worth Tk 1,375 crore in the fiscal year 2020-21, when the country produced 33.62 lakh tonnes.

Data shows that country produces 23 lakh tonnes of onion on average every year and imports five lakh tonnes.

But despite the highest production volume, which was 10 lakh tonnes more than the average, the government still imported nearly five lakh tonnes.

According to Bangladesh Trade and Tariff Commission, the annual domestic demand for onion is around 24 lakh tonnes.

The National Board of Revenue data shows in the fiscal year 2019-20, the government imported 4.17 lakh tonnes of onion worth Tk 1,147 crore. The country produced 25.57 lakh tonnes that year. This means onion consumption in that fiscal year was 29.74 lakh tonnes.

Experts say production was over 33 lakh tonnes in FY21 and assuming that 4-5 lakh tonnes perished, imports still should not have been more than that of the previous year.       

Former Bangladesh Institute of Development Studies director Dr Asaduzzaman told The Business Post, “This import volume is fine even after producing more than 33 lakh tonnes if imported onion is used for any special purpose other than in the kitchen.”       

He thinks Bangladesh has to import onion as it is a perishable item and the country does not have better storage systems.

Local production could meet domestic demand if farmers supplied onion to the market on time, he said. 

“Supply glut pushes down prices. Farmers cannot store onion for a long time like rice. If the demand is 24 lakh tonnes and the government still needs to import five lakh tonnes after producing 33 lakh tonnes, it means there is a lack of good dry storage system,” the economist added.

In FY19, the government imported about 11.35 lakh tonnes of onion worth Tk 1,838 crore, the highest so far. That year, farmers produced 23.3 lakh tonnes.

As repeated bans on onion exports by India create shortfalls during the lean season in Bangladesh, the government has taken an initiative to increase onion production by 10 lakh tonnes within the next three years in order to attain self-sufficiency and cut import dependence.

When onion prices were skyrocketing in 2019, more farmers took up onion cultivation to make more profits. The rise in per hectare yield was the major reason behind the production boost.

Government officials say they are trying to achieve self-sufficiency in onion production. 

Commerce ministry’s Additional Secretary (import and internal trade wing) AHM Shafiquzzaman said the agriculture ministry was working to produce more onion.

“The import volume is declining every year. We can stop imports but cannot do so overnight. We are trying to decrease import dependency,” he
said.

Onion prices were very high in the country in 2019 after an export ban had been imposed by India. The high prices forced people to pay as much as Tk 300 for a kg at times. This put huge pressure on the government to devise ways to meet domestic demand with local production.

Major onion producing disytricts in the country are -Rajshahi, Faridpur, Pabna, Meherpur, Kushtia, Magura, Bogura, Rangpur, Thakurgaon, Dinajpur, and Jamalpur. Bangladesh has been over dependent on Indian onions for decades, while the key cooking ingredient is also imported from Pakistan, Egypt and Turkey.