Onion exports decline by 14% in FY08

Ban on onions exports in September and October has resulted in India's exports of the commodity falling by 14 per cent to 996,057 million tonnes in 2007-08 (April-March).

Exports fell despite a 15 per cent rise in last year's output. Container shortage and port congestion were also responsible for fall in exports, they said.

In September, when wholesale onion prices sky-rocketed to Rs 1,800-2,000 a quintal, the government had temporarily suspended exports to increase domestic availability ahead of arrival of late kharif crop in November-December.

The government, via canalising agency the National Agricultural Cooperative Marketing Federation, had halted issuance of fresh no objection certificates for onion exports to bring down domestic prices.

"Yes, exports were down due to temporary halt in NOCs to bring down prices, which had risen as high as Rs 30 a kg in retail markets," NAFED Chairman C B Holkar said.

Exports in September fell to 67,000 tonnes compared with over 102,000 tonnes in the same month a year ago, while in October exports fell sharply to 23,785 tonnes from 88,389 tonnes a year ago, government data showed.

Exports in November were also lower at 70,720 tonnes compared with 108,170 tonnes in November 2006, the data said.

Following the removal of the ban, exports picked up in January-March to over 375,000 tonnes, compared with 234,000 tonnes during same period a year ago.

"The ban has benefited countries such as Pakistan and Iran that were never major exporters of onion," said Ajit Shah, director of Mumbai-based onion exporter Shah Mahendrakumar & Co Exports.

Knee-jerk export-import policy moves only damage the country's image in international markets and buyers shift to other countries to meet their requirement, Shah said.

The government must continue exports despite ups and downs in domestic prices, Shah said.

Farmers's woes
On the domestic front, abrupt changes in policy hurt both consumers and farmers, he said.

Although the temporary suspension of onion exports provided some relief to consumers, it irked farmers, leading to mass rallies and blockade in September at various places in Nashik district, the onion hub of India.

"Every time when farmers get some money due to rise in prices, government imposes restrictions, but it (government) never came to rescue farmers when prices were below cost of productions," said Nivrittinath Shinde, an onion dealer at Lasalgaon, in Nashik.

In November, exporters realised Rs 120 crore from export of 70,720 tonnes onion.

However, export realisation actually fell to Rs 110 crore in January, and Rs 97.6 Crore in March despite the export quantity doubling to 144,000 tonnes.