India Onion Exports Surge: Over 45,000 Tonnes Shipped Post-Ban Lift

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India Exports Over 45,000 Tonnes of Onions After Ban Lift

Team Finance Saathi

24/May/2024

Key Points:

India exports over 45,000 tonnes of onions following the lifting of the export ban.
Government imposes a minimum export price of US$ 550 per tonne to stabilize domestic prices.
Initiatives include onion procurement for a targeted 500,000-tonne buffer stock amidst projected production decline.

Following the lifting of the export ban earlier this month, India has witnessed a notable surge in onion exports, with over 45,000 tonnes shipped to international markets. This move comes as a relief for farmers who faced restrictions aimed at stabilizing domestic supplies ahead of general elections.

Export Ban Lift and MEP Implementation

Initially imposed last December and extended in March, the export ban was aimed at curbing price hikes caused by sluggish production. Secretary of the Consumer Affairs Ministry, Ms. Nidhi Khare, confirmed that most onion exports since the ban's lift have been directed towards the Middle East and Bangladesh. To maintain affordable onion prices during the election period, the government lifted the ban on May 4 but imposed a minimum export price (MEP) of US$ 550 per tonne.

Production and Procurement Initiatives

Amidst production challenges, state-owned agencies have initiated onion procurement from the recent winter harvest. The goal is to establish a targeted 500,000-tonne buffer stock for the current year. The Agriculture Ministry projects a 16% decline in onion production from the previous year, estimating it at 25.47 million tonnes in the 2023-24 crop year. Reduced output in key growing regions such as Maharashtra, Karnataka, and Andhra Pradesh contributes to this decline.

Monsoon Forecast and Outlook

Ms. Khare also highlighted expectations of a favorable monsoon forecast this year, ensuring better summer crop sowing, including onions, from June onwards. This forecast brings optimism amidst production challenges and aims to mitigate the impact of reduced onion production on domestic markets.

Conclusion

The surge in onion exports post-ban lift, coupled with government initiatives to stabilize domestic prices and ensure adequate buffer stocks, reflects India's proactive approach to addressing challenges in the agricultural sector. As the country navigates production fluctuations and international trade dynamics, strategic measures and collaborative efforts are crucial to safeguarding the interests of farmers and consumers alike.

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