Onion export prices may come down after Diwali

The minimum export price (MEP) of onion, which is in the range of $445-565 a tonne, is likely to be revised after Diwali.

"We will review the onion MEP after Diwali," Alok Ranjan, managing director, National Agricultural Cooperative Marketing Federation of India (Nafed) told PTI.

The arrival of Kharif onion would come in full swing after Diwali, Ranjan said, adding, "We will review the prices and availability after Diwali and accordingly take a decision."

However, a government official said there is likely to be a downward revision in onion MEP as the decision to hike the prices was taken when the domestic prices were much higher than the current level.

On October 31, Nafed had decided not to tinker with the MEP in view of the festival season as retail prices were yet to come down substantially. The domestic prices are in control at the moment, Ranjan said.

Although onion retail prices are still in the range of Rs 20-24 a kg, traders said rates would drop after Diwali.

Besides Nafed, there are 12 other agencies notified by the government to export onion. These agencies decide the MEP of onion every month. Last month, the MEP was raised by $50 a tonne to $445-565 a tonne, depending on the export destinations, to curb the rise in domestic prices.

The government also tightened norms by making export licences mandatory for onion shipments, while retaining the earlier practice of export through no objection certificates (NoC) issued by Nafed.

The price for export of onion to Pakistan is $445 a tonne while for Greece it is $565 a tonne. Singapore gets Indian onions at $495, Malaysia $470, Sri Lanka $480, Bangladesh and UAE $500.

India's onion exports during April-September 2007 came down 37 per cent at 3.82 lakh tonnes, as against 6.05 lakh tonnes in the corresponding period last year.

Meanwhile, onion arrivals in many places have risen as the Kharif season harvesting is in full swing.

The arrival of onion in Bangalore surged to 14.65 lakh tonnes in October 2007 from 6.95 lakh tonnes in the previous month.

The supply in Hubli, a major market in Karnataka, also increased to 3.10 lakh tonnes from 33,520 tonnes, according to Nasik-based National Horticultural Research and Development Foundation (NHRDF).

However, the supply is yet to pick up in Maharashtra, the country's largest onion growing state.

Onion arrivals in Pimpalgaon, Lasalgaon and Nasik mandis were, in fact, down last month compared with the supply in September 2007. The arrival, however, increased at Solapur to 1.47 lakh tonnes from 73,188 tonnes, NHRDF data showed.

In Delhi, which is a major onion consumption centre in the country, the supply increased marginally to 2.43 lakh tonnes in October, as compared with 2.31 lakh tonnes in September 2007.