India slips behind Pak in onion exports

India has slipped behind in this year’s onion export market to its nearest competitor, Pakistan, due to the latter’s low pricing of the politically sensitive commodity.

But, traders also expect India to restore its position in the near future, once good quality stock hits the market in a week’s time.

Today, prices of Indian-origin onion for c&f (cost and freight) were quoted at $550 a tonne, as the government had earlier this month raised the minimum export price (MEP) by $145 to an average $445-450 a tonne for November. Whereas, onions of Pakistan origin are quoted at $350 a tonne.

“Export demand has dried up due to price escalation in the domestic market. Overseas buyers are, perhaps, waiting for prices to come down to pass on orders,” said Nitin Parakh, proprietor, Hari Om Traders, a Vashi-based onion trader.

Traders from India were earlier expecting a better year for exports. Shipments, largely to West Asia, Malaysia and Colombo, had jumped 8.3 per cent to 991,000 tonnes in the first half of the current financial year, as compared to 915,000 tonnes in the corresponding period last year. Had the pace continued, exports from India could have surpassed last year’s record of 1.76 million tonnes, said Parakh.

He believes overseas consumers prefer to import onions from India, due to better quality and sustainable supply commitment. Exports from Pakistan are a time-bond phenomenon, which would continue for a month or two, as the country has reportedly harvested a bumper crop. Pakistan had imported 169,918 tonnes of onions from India last year after failure of its crop. This financial year, it had purchased about 50,000 tonnes from India but, the imports have almost stopped since May-end.

Meanwhile, a three-day unseasonable rainfall last week disrupted supply into major mandis, with arrivals reduced by 80 per cent. This pushed prices up to Rs 20-25 a kg, against Rs 8-10 a kg during the previous week.

A large quantity of stored onion in the open field and godowns got spoilt due to the rainfall. Also, matured crops waiting to be harvested got damaged with the huge moisture content in the field. Traders expect 25-30 per cent of the crop to be spoiled due to rainfall.

The country produces about 40 per cent its onions during the kharif and late kharif seasons, while the rabi season, starting October, accounts for the other 60 per cent.