Are importers hoarding onions, asks consumer body

CAP is worried that the high prices of onions will have a spillover effect on other food items. (Bernama pic)

GEORGE TOWN: In view of rising onion prices in the market,a consumer group today urged the authorities to check local importers of Indian onions to see if they have been hoarding the bulbs and selling them at higher prices.

Consumers’ Association of Penang (CAP) said this was a likely scenario as most wholesalers in Malaysia would buy the onions in advance at a pre-determined price so as not to be affected by future changes.

“The domestic trade and consumer affairs ministry should check their futures pricing contracts to see if they are profiteering. They should also check if they are hoarding old stock, but selling them at current prices.

“We believe the current onions being sold are most likely brought in by importers much earlier before any price increase. Therefore, on this basis, the existing stock of onions should not be sold at the current price,” CAP president Mohideen Abdul Kader said in a statement.

Onions have a shelf life of two to three months, depending on storage conditions.

Prices of onions have been hovering around RM12 to RM15 per kg at major wet markets since September, compared to RM5 to RM9 previously. The government said prices were likely to drop next month and urged consumers to buy subsidised onions from the farmers’ markets (Pasar Tani).

The increase in prices is attributed to India raising the minimum export prices of onions to US$850 (RM3,474) per tonne to keep stocks for local consumption following an acute shortage caused by floods in key onion-growing states.

The country exported 2.2 million tonnes of onions in the 2018/19 fiscal year ending March 30, Reuters reported, making it the largest exporter in the world. CAP had previously urged the government to source onions from other markets to prevent a spillover effect on other food items which relied on onions.

Mohideen said Malaysia imported 332,451 tonnes of fresh onions worth US$74.1 million in 2018. He said that the import alone had “bled” Malaysia of RM1.2 billion in foreign exchange.

He said it was the same for the country’s imports of produce from China, Pakistan, the Netherlands, Thailand and Indonesia. He said Malaysia imported RM3.2 billion of fruits and vegetables in 2016.

Mohideen said by right, Malaysia should be self-sustaining by relying on local produce, just like Thailand. He said there were misplaced priorities where there were more oil palm plantations, at 5.1 million hectares compared to 52,582ha of vegetable farms and 205,467ha of fruit orchards.

“Being too dependent on imported vegetables, we have to pay more for the produce because of the weakened ringgit since mid-2014 when the global oil (petroleum) prices started to decline.

“We call upon the government to formulate an agricultural policy with a holistic approach, not forgetting the rural poor who have small plots of land to cultivate.”