AgriMin seeks ease of export curbs on pulses, groundnut oil and onions as prices fall

With groundnut oil prices falling in recent months, the agriculture ministry has written to the commerce department to lift a five-year ban on bulk exports of the commodity. At present, edible oils, including groundnut, can be exported but only in small packages of five kg.

Officials said the ministry had also sought lifting of the ban on pulse export and abolishing the existing minimum export price (MEP) of onions in view of the sharp fall in wholesale market rates.

Export of all variety of pulses, except kabuli chana, was banned in 2006. It has been extended from time-to-time up to March. The onion MEP was slashed to $150 a tonne in December 2013 from $350 a tonne.

"In pulses, the commerce ministry should not renew the ban when its term expires as prices have dropped below the minimum support price (MSP) in some places," said a senior official.

He said Agriculture Minister Sharad Pawar had written to Commerce and Industry Minister Anand Sharma and Finance Minister P Chidambaram twice, seeking to abolish the MEP in onions. Even last month, the Department of Agriculture had pressed for abolishing the MEP on onions.

"Basically, what we are saying is that prices in these three commodities have either fallen below MSP or are ruling far below their cost of production causing hardship to farmers. Hence, some avenue should be opened immediately or else the growers will suffer," the official said.

In groundnut oil, officials said prices have dropped to their four-year low due to bumper harvest and weak demand.

In February, groundnut oil was trading in Gujarat at around Rs 1,340-1,350 for a 15-kg tin, almost 40 per cent less than the same period last year.

According to edible oil industry sources, groundnut oil production is likely to increase to 300,000 tonnes in 2013-14 compared to last three years' average production of 200,000 tonnes due to higher crushing.

The government's first advance estimate of 2013-14 farm production pegged kharif groundnut seed production at 5.6 million tonnes, a whopping 81 per cent more than 2012-13 mainly due to excellent rains in main growing regions of Gujarat.

The Solvent Extractors Association of India (SEA), too, has demanded lifting the ban on export of groundnut oil in bulk.

In pulses, officials said the wholesale price of chana is ruling much below its 2013-14 MSP of Rs 3,100 a quintal in some cities.

In onion, the monthly wholesale rates on an average across India have dropped from Rs 39 a kg in August 2013 to Rs 14 in February this year, a decline of 64 per cent.