Govt urged to lower onion export price

Onion exporters have urged the government to lower the minimum export price (MEP) of the commodity as domestic onion prices have come down to levels of Rs 700-750 a quintal after witnessing a high of Rs 1200-1300 a quintal in February.

"The MEP has to be in proportion to the domestic prices. But the existing MEP of $345 a tonne (cost & freight) that translates into a realisation of Rs 10,500-11,000 a tonne (excluding freight, etc) is significantly high compared to domestic price of Rs 7,000-7,500 a tonne. Exports have become impossible at these rates", said a Maharashtra-based onion exporter.

Alok Ranjan, managing director of the National Agricultural Cooperative Marketing Federation (Nafed), the agency that decides MEP, said: "As of now, we have no plans to lower the MEP as we apprehend this could help exports and create a shortage in domestic supply."

Owing to increased exports, retail onion prices had surged from Rs 10 to Rs 24 a kg in February, though of late prices are hovering around Rs 14-15 a kg. The government, plagued by inflation, swung into action to make exports less lucrative. The MEP of onion was increased by 13 per cent from $305 to $345 a tonne.

About 10.5 lakh tonne onion have been exported up to March 5, and the export figures in the current financial year is likely to touch 11 lakh tonne, said Ranjan. This will be about 41 per cent increase over the last financial year's total export of 7.78 lakh tonne.

While exports surged more than 40 per cent year-on-year, domestic production, according to the National Horticultural Research and Development Foundation, is similar to the last year's figure of about 62 lakh tonne.