According to wholesale merchants at APMC, the rains have retreated in the onion-growing areas of Maharashtra and the areas are now receiving good sunshine which is essential for the growth of onion crop. This could be the reason for the delay by Nafed to import onions, a few merchants said.

The recent hike in prices for export of onions by Nafed is expected to result in increased supplies domestically which will in turn induce reduction in prices, traders added.

The arrivals of onions at the wholesale market has almost doubled to 80-90 lorries a day against 40-50 lorries a fortnight back, merchants said. Presently, the arrivals include both, the old and new crops, bulk of which being the onions from the previous season.

The wholesale Saturday prices of onions from the previous season were quoted in the range of Rs13-20 per kilogram depending on the variety, whereas the prices of new arrivals ranged between Rs 12 and Rs 18.

Sources said prices have also shot up as farmers were holding on to their stocks expecting further rise but with the fullfledged arrivals of new crop being only a fortnight away they may start offloading the hoarded stock in the market during next week.

The fact remains that there have been crop failures in the country due to unseasonal rains in May as a result there have been several cases of hoarding by large retailers which have further spiralled costs of onions.

Residents of Mumbai have been paying high rates of onions recently. Retailers have been attributing the severe price rise to failure of rabi crop. Unseasonal rains during the sowing season had no doubt ruined the availability of cheap vegetables including onions, they added.

Nashik district, a major supplier of onions, was hit by unseasonal rain causing severe damage to the crop. This affected onion supplies and prices.Onionprices also shot up to a maximum of Rs 26 per kilogram recently against May's Rs six.

Major supplying centres Nashik, Pune, Sangli and Kanpur as well as other growing centres around Mumbai have started despatches of the new crop, traders said. Exports of onion make up 90 per cent of India's vegetable shipments and brings in over Rs 300 crore annually.

However, a handful of traders were still apprehensive and said though the prices for exports had been raised, those requiring Indian onion would still buy it.

Nafed had, however, opposed any ban on onion exports as it was of the view that it could damage India's standing in the global vegetable market and had instead agreed to raise prices.

India's market share could be taken over by other nations if exports were banned and it would take considerable amount of time to build a market again, Nafed had contended with the agriculture ministry in a note pleading against the ban.

Pakistan, Sri Lanka, China, Iran, Egypt and Holland to an extent competeagainst Indian onions in the global market.

Sources said onion exports during July and August were only one-third of last year's shipments and, therefore, prices had not shot up due to exports. However, the Nafed move is being seen as a balance between keeping the export potential alive and meeting the domestic demand.