Onion Export Price Slashed to $375 for Nov to Boost Exports.

New Delhi: The government has decided to to reduce minimum export price (MEP) by $50 a tonne for November to encourage exports as domestic prices are expected to soften in the near future on arrival of new kharif crop by middle of this month. This is the first reduction in onion MEP since August.

The government had hiked the minimum export price of onion to $ 425 per tonne in October from $220 per tonne in August to bring down exports and ensure adequate domestic supplies.

“The onion MEP has been fixed at $375 per tonne for November, against $ 425 per tonne in the previous month,” an official from Nafed, the nodal agency for onion exports said.

In September, India’s onion exports commanded a big premium in Dubai and Gulf countries as supplies from Pakistan stopped due to unprecedented floods in the neighbouring country. Indian onion commanded a price of more than $ 400 a tonne in Dubai at that time.

The country exported 1.01 million tonne of onion this fiscal, against 1.29 million tonne a year back. India exports onions to Bangladesh, the West Asia, Singapore and Malaysia.

The MEP has been lowered to boost exports in the current month in anticipation that the fresh kharif arrival which is expected to arrive during the next two weeks will pull down local prices. Harvesting of kharif onion crop is at present on in Andhra Pradesh, Karnataka, Tamil Nadu and Maharashtra.

Although the wholesale market at Lasalgaon near in Nashik, which is Asia’s- biggest onion wholesale market, is closed for Diwali this week, traders said that domestic wholesale prices were expected to come down from Rs 1,500 a quintal last week to around Rs 1,000-1,200 per quintal after kharif crop arrives.

Onion prices have been on the boil for the last one month because of festival demand and inadequate supplies.

Steady demand because of the ongoing festival seasons and poor supplies had pushed up wholesale prices to almost Rs 1,500 per quintal as against Rs 700 in August and September. The jump in wholesale prices has pushed up retail prices, which now rule at around Rs 25 a kg in Delhi as against Rs 16 a kg just two months back. Prices have been firm in other cities as well because of low supplies.

Source : financialexpress.com