The government has decided to increase the benchmark price for exporting onions by $20 to $220 a tonne in August to discourage overseas shipments, as prices in the domestic market have gone up.
We have increased the minimum export price (MEP) of onion by $20 to an average price of $220, as the prices have gone up by Rs 100-150 per quintal in the wholesale market," a senior official at Nafed said.
Nafed, along with 12 other agencies, regulates the export of onions and fixes the MEP every month.
The official said that domestic rates are expected to rise further, as during the August-September period, fresh supply comes from only South India and most of the local demand is met through cold storage.
He also pointed out that the export demand has not been very good so far this fiscal, as Pakistan and China are exporting onions at cheaper rates than India. India exports onions to Bangladesh, West Asia, Singapore and Malaysia.
In the 2009-10 fiscal, the country's onion exports rose marginally to 18.14 lakh tonnes against 17.83 lakh tonnes in the previous year.
The country's onion production is expected to be a record 95 lakh tonnes in 2009-10, against 85 lakh tonnes last year.
