Govt to Buy 1,650 Tonnes of Onions From Farmers at This Price for Exports

After a break of over three months, India is set to resume onion exports with a shipment of 1,650 tonnes to Bangladesh. The move comes following the government's decision to permit exports to specific countries amid surging domestic prices and concerns about availability.

The National Cooperative Export Ltd (NCEL), the government's export agency, has announced plans to purchase onions from private traders at Rs 29/kg for export to Bangladesh. This marks the first official export of onions from India since the ban imposed on December 8 last year, which was in effect until March 31.

In the first week of March, the Centre allowed the export of 64,400 tonnes of onions to countries that formally requested them through diplomatic channels. Bangladesh was allocated 50,000 tonnes of this quota, while the UAE received the remaining 14,400 tonnes.

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India's export restrictions on onions were primarily aimed at stabilizing domestic prices, which had soared to unprecedented levels. The ban also contributed to an increase in international prices due to reduced global supply, particularly during the peak demand period associated with Ramadan in markets like Bangladesh, West Asia, and Southeast Asia.

Despite the ban, smuggling activities continued to thrive, accounting for more than 50 per cent of the trade volume during normal conditions.

Currently, wholesale onion prices in Maharashtra's Nashik district range from Rs 7/kg to Rs 16/kg. Prices are expected to decrease further with the ongoing arrival of fresh rabi harvest.

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While the exact selling price of onions to Bangladesh remains undisclosed, reports indicate significant profits for the export agency, with onions currently priced at Rs 80-90/kg in the Bangladeshi market. India typically dominates the global onion market from January to March.

Between April 1, 2023, and August 4, 2023, India exported a total of 975,000 tonnes of onions, with Bangladesh, Malaysia, and the UAE emerging as the top importing countries in terms of value.

The Indian government initially imposed restrictions on onions in October 2023 by implementing a minimum export price (MEP) of $800 per tonne until December 31, 2023. Additionally, a 40 per cent export duty was imposed on onions until the same date.

With the resumption of onion exports, India aims to balance domestic requirements while catering to international demand, ensuring stability in both domestic and global markets.

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