Wholesale onion prices firm up on lifting of ban on export; farmer bodies still unhappy

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Published: February 28, 2020 2:15:52 AM

The minister tweeted that since the price of onion has stabilised and there is bumper onion crop, the government has decided to lift ban on export of onions.

At present, onion prices are on the rise across the markets in the world.At present, onion prices are on the rise across the markets in the world.

Wholesale Onion prices at Lasalgaon — the country’s largest wholesale market for the bulb firmed up on Thursday by Rs 500 per quintal after Ram Vilas Paswan, Union minister of consumer affairs, food & public distribution tweeted that the government has decided to lift the ban on onion export.

The minister tweeted that since the price of onion has stabilised and there is bumper onion crop, the government has decided to lift ban on export of onions.

Expected monthly harvest in March is over 40 lakh MT compared to 28.4 lakh MT last year. The lifting of the ban would be effective once the Directorate General of Foreign Trade (DGFT) issues a notification in this regard. The GoM on Wednesday also deliberated on whether to reduce or scrap the Minimum Export Price (MEP) on onion to facilitate outbound shipments, the sources said. The MEP is the rate below which no exports are allowed.

While farmers and traders were happy with this announcement, the Shetkari Sanghatana led by Anil Ghanwat said that this is not a permanent measure and called for an onion conference on March 1 at Chandwad in Nashik district to chalk out an agitation plan.

Jaydutta Holkar, former chairman, Lasalgaon APMC said that the measure taken by the government wold help boost exports. The GR is yet to come but just a tweet by the minister resulted in an improvement in onion prices by Rs 150-200 per quintal, he said. On Thursday, modal onion prices at Lasalgaon were Rs 2,150 per quintal with minimum prices at Rs 1,000 per quintal. Some 14,000 quintals were traded on Thursday. On Tuesday, modal onion prices were Rs 1,650 per quintal. On Monday, average onion prices were Rs 1,800 per quintal.

Anil Ghanwat said that the Sanghatana is seeking reduction of government interference in onion trade and removal of other restrictions on onion. “To curb onion prices, the central government has banned onion exports, imposed stock limits and imported onions from abroad. Now, that a new crop of onion has come into the market, the prices of onion are falling. Against this backdrop, the central government has announced opening up of onion exports. Onion prices are likely to firm up because of this announcement but it remains to be seen how long this onion export is allowed, for which variety of onion and the export duties that will be imposed on the onion and the stock limits, nothing is clear yet,” he said.

Ghanwat pointed out that even though the onion export ban is lifted, it will take at least a month for export contracts to be signed. We are losing credibility in the international market with onion exports due to the central government’s erratic policies. To achieve that, it is necessary to adopt a permanent export policy, he said.

“While the government is implementing anti-farmer policies in the interest of consumers, they are pushing farmers into a debt trap. At present, onion prices are on the rise across the markets in the world. There is demand but due to export restrictions, this opportunity is slipping out of hand”, he said.

India is getting foreign currency worth Rs 3,000 crore in one year from onion exports,” he said, adding that onion prices impact not only farmers but other related businesses as well.

The onion conference to be held at Chandwad will discuss in depth onion crops, trade, storage, export and government policy. Vilas Shinde, president, Sahyadri Farmer Producer Company, Bharat Dighole, president, Onion Producers Farmers Association, Seema Narode, president, Maharashtra Shetkari Sanghatana are expected to attend the meet.

In September 2019, the government banned onion exports and also imposed a MEP of $850 per tonne. The move came after prices had started skyrocketing due to supply-demand mismatch. There was a shortage of onion as kharif crop was adversely affected due to excessive rains and floods in key producing states, including Maharashtra.

Currently, the arrival of rabi (winter) crop of onion has begun in small quantities and would increase from mid-March onwards. In March alone, onion arrivals are expected to be as high as 40.68 lakh tonne when compared with 28.44 lakh tonne in the year-ago period, as per the sources. The arrival is anticipated to be higher at 86 lakh tonne in April compared to 61 lakh tonne in the year-ago period.

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