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India’s onion exports are estimated to have almost trebled in the recently ended financial year 2016-17, following the government’s move to incentivise overseas consignments. The move was taken to encourage large shipments of the commodity to overseas markets, as realisations abroad were better than those in the domestic market.
Data compiled by the government-owned Agricultural & Processed Food Products Exports Development Authority (Apeda) showed India’s overall onion exports at 2.39 million tonnes for the period between April and December 2016.
Ajit Shah, President of Horticulture Exporters Association believes that another 150,000-200,000 tonnes were exported every month thereafter. Assuming 200,000 tonnes per month shipped for the next three months i.e. between January and March 2017, India’s overall onion export is estimated to have achieved three million tonnes for 2016-17, an all-time record.
“The Merchandise Exports from India Scheme (MEIS) scheme was initiated when onion prices were hovering around Rs 2–2.5 a kg in the benchmark Lasalgaon wholesale mandi in Maharashtra. Farmers in Lasalgaon (Nashik district) were indulging into leaving onion unharvested in the field as the prevailing price could not cover the cost of transportation to the mandis. However, the MEIS scheme arrested the fall and onion price recovered to trade between Rs 5-5.50 a kg. This price level is simply equivalent to the cost of production. But, farmers need a little more in order to be encouraged to sow onion the next season,” said Hansaraj Patil, a farmers’ representative in Lasalgaon.
Faced with a sharp decline in onion prices on expectations of bumper output, the Ministry of Commerce and Industry extended benefit under MEIS to onion and directed traders to export it in large quantities. Available for many exportable goods including textile products, MEIS allows exporters to obtain five per cent credit on the free on board (FOB) value of onions, both fresh and chilled.
Data compiled by the government-owned Agricultural & Processed Food Products Exports Development Authority (Apeda) showed India’s overall onion exports at 2.39 million tonnes for the period between April and December 2016.
Ajit Shah, President of Horticulture Exporters Association believes that another 150,000-200,000 tonnes were exported every month thereafter. Assuming 200,000 tonnes per month shipped for the next three months i.e. between January and March 2017, India’s overall onion export is estimated to have achieved three million tonnes for 2016-17, an all-time record.
“The Merchandise Exports from India Scheme (MEIS) scheme was initiated when onion prices were hovering around Rs 2–2.5 a kg in the benchmark Lasalgaon wholesale mandi in Maharashtra. Farmers in Lasalgaon (Nashik district) were indulging into leaving onion unharvested in the field as the prevailing price could not cover the cost of transportation to the mandis. However, the MEIS scheme arrested the fall and onion price recovered to trade between Rs 5-5.50 a kg. This price level is simply equivalent to the cost of production. But, farmers need a little more in order to be encouraged to sow onion the next season,” said Hansaraj Patil, a farmers’ representative in Lasalgaon.
Faced with a sharp decline in onion prices on expectations of bumper output, the Ministry of Commerce and Industry extended benefit under MEIS to onion and directed traders to export it in large quantities. Available for many exportable goods including textile products, MEIS allows exporters to obtain five per cent credit on the free on board (FOB) value of onions, both fresh and chilled.
| Spiralling growth: India’s onion exports | |||
| Financial year | Quantity (mn tonnes) | Value (Rs cr) | PUV (Rs/tonne) |
| 2010-11 | 1.34 | 2,159 | 16,103 |
| 2011-12 | 1.55 | 2,141 | 13,790 |
| 2012-13 | 1.82 | 2,295 | 12,590 |
| 2013-14 | 1.36 | 2,877 | 21,184 |
| 2014-15 | 1.09 | 2,010 | 18,507 |
| 2015-16 | 1.11 | 2,529 | 22,691 |
| 2016-17* | 3.00 | -- | -- |
| Source: DGCIS and Nafed; * Estimates | |||
