The Indian government has recently revised regulations on onion exports, setting a minimum export price (MEP) of $550/ton with an additional 40% export duty, effectively establishing a floor price of $770/ton or approximately Rs 64/kg. This adjustment follows the lifting of an export ban imposed in December of the previous year. However, market participants express concerns that the stipulated price range may hinder India's competitiveness in the global market, especially against lower-priced offerings from nations like Pakistan and China.
Stakeholders from the sector, including Jaydutt Holkar, director of the Agricultural Produce Market Committee (APMC) in Lasalgaon, Nashik, suggest that a reduction in export duty is necessary to enhance India's market position. Balasaheb Misal, an onion farmer and former director of the Manmard (Maharashtra) mandi board, echoes this sentiment, deeming the approved export prices as unrealistically high.
Following the government's decision, domestic market responses were immediate, with onion prices in key trading hubs such as Lasalgaon and Azadpur mandi in Delhi experiencing notable increases. This regulatory change precedes upcoming electoral phases in Maharashtra, a significant onion-producing region, where farmers have advocated for the removal of export restrictions amidst pricing pressures.
The government's rationale for amending export conditions references a projected "reasonably comfortable" rabi crop output for the 2024-25 season, which constitutes a significant portion of India's annual onion production. Despite previous prohibitions, India facilitated limited onion exports to specific countries last year, contributing to its export volume of approximately 1.8 million tons, primarily to destinations like Bangladesh, Malaysia, and the UAE.
[ Rs 100 = €1.10 ]
Source: financialexpress.com