Nafed cuts onion export price by $75/tn

With the decline in domestic onion prices and increase in arrivals, the minimum export price (MEP) of onion has been cut by $75 a tonne with effect from November 19.

The MEP now stands at $420 a tonne. The export price was raised from $445 to record $495 a tonne with effect from October 1 to curb onion exports and check its rising domestic prices.

This is the first cut in MEP since May this year. Between May and October, the MEP was more than doubled from $225 to $495 a tonne to discourage exports and boost domestic availability.

"Arrivals are good in all the wholesale mandis and the price has softened at the wholesale as well as the retail level. All the major festivals are also over and therefore a decision has been taken to cut the MEP," said Alok Ranjan, managing director, National Agricultural Cooperative Marketing Federation (Nafed), the agency that revises MEP on a monthly basis.

The licence restriction on onion exports, imposed by the commerce ministry in October has also been withdrawn last week.

The retail price of onion has also declined from Rs 24 to Rs 16 a kg in a month's time. At the Nasik mandi, the modal price of onion has declined from Rs 1,150 to Rs 750 a quintal since November 1. Modal price is the price at which maximum arrivals take place.

"The arrival in mandis are good and prices have slipped from Rs 900-1,200 a quintal to Rs 600-1,000 at the wholesale level. The declining trend is likely to continue," said Rajinder Sharma, the general secretary of the Potato and Onion Merchants' Association, Delhi.

India has exported 4,44,685 tonnes of onion in the April-October period this year, a decline of about 35 per cent compared with 6,94,334 tonnes for the corresponding period last year. This decline is mainly due to the higher MEP that has rendered exports unattractive.

According to the National Horticultural Research and Development Foundation (NHRDF), this year's kharif crop of onion is estimated at 1.7 lakh tonnes, up 30 per cent from last year.