Govt hikes onion MEP to $525/tn to check domestic rates

The government today increased the minimum export price (MEP) of onion sharply by $150 to $525 per tonne for the current month to discourage exports and control rising prices in the domestic market.

"We have increased the onion MEP from $375 a tonne to $525 a tonne for this month and we will again review the export prices by month-end," the Managing Director of agri- cooperative and onion export regulator NAFED, Sanjeev Chopra, told reporters here.

He said Nafed and NCFF will sell onion at Rs 25 per kg from tomorrow in the national capital.

"We increased onion MEP sharply because of unprecedented rise in prices especially in retail markets," he said.

Onion prices in Delhi have risen to around Rs 40 a kg, according to trade data.

The country has shipped 10.10 lakh tonnes of onion so far this fiscal, against 12.99 lakh tonnes in the year-ago period, the official data showed.

India's onion output (including Kharif and Rabi season) is pegged at around 130 lakh tonnes in 2010-11.

Agri-cooperative major Nafed, along with 13 other agencies involved in onion exports, regulates exports by fixing the MEP every month. No export can take place below the MEP and all contracts are registered with Nafed.

India exports onions to Bangladesh, the West Asia, Singapore and Malaysia.