The average price of Indian onions rose by 60% in the two weeks up to 13th October 2021 due to unfavorable weather causing supply shortages. The 2021 monsoon season arrived early in India, signaling a positive outlook for harvest. However, July and August faced a deficit in rainfall of approximately 9% compared to the average precipitation for that time of the year, causing a delay in Kharif onion harvest (cultivated from June-November) in some important regions in India.
The uneven distribution of monsoon rains hit India's key production areas. Maharashtra, which accounts for over one-third of India’s total Kharif onion production, faced challenges in transplanting the crop in August due a rainfall deficit. As a result, this delayed the arrival of the onion crop for this season.
The impact of the erratic monsoon rains has led to a supply shortage, causing a spike in prices in early October 2021. The Department of Consumer Affairs announced that onion stocks are being released onto the market in October to mitigate the risk of a price spike. This could ease supply pressure, thus stabilising the price over the short term.