The container freight stations (CFSs) at JNPT port have begun to stink, with over 250 refrigerated containers with about 7,000 tonnes of imported onions rotting and lying idle for about a month now. Importers are in no hurry to clear their consignments as the landed cost of onions is way above the local market costs.

Trade sources told BusinessLine the landed cost of imported onions is working out to ₹45/kg while in the wholesale market the price has plummeted sharply (the modal price is now ₹23/kg), leading to importers going slow on clearing their consignments from the CFSs. The importers now want shipping companies to waive certain charges so that their landed costs come down, sources said.

A CFS is a warehouse where goods are stored before being shipped to multiple customers. There are 33 CFSs at JNPT.

Rain damage

The country has enough onions acreage and production to meet its domestic demand. However, last year, with excess monsoon in Maharashtra’s Nashik region, the crop was partially destroyed, leading to a massive spike in prices across the country. Nashik has the largest area under onion cultivation in the country, as its unique agro-climatic conditions are most conducive for the crop.

Sources said that anticipating shortage in the market, traders placed their orders in the Egyptian market by early October 2019, and these arrived at JNPT after November 1 at a landed cost of ₹26-28/kg, while in the retail markets the prices had reached ₹130/kg. The Centre also jumped in, with MMTC Ltd, a PSU, placing import orders.

But, after some initial success, the process boomeranged, as the local supply improved and there were fewer takers for imported but non-spicy onions from markets such as Egypt and Turkey. As a result, onion cargo continues to wait at JNPT port, sources added.