Onion exports may drop 20% in April-Feb

Onion exports during the first 11 months of the current financial year is likely to decline 20 per cent to about 850,000 tonnes compared with the year-ago period due to restrictions on overseas sales during festival season. The onion exports during April-February in 2006-07 was 1.1 million tonnes.

In January, however, the exports stood at 151,000 tonnes against 67,194 tonnes in the year-ago month. Last year, the onion prices were very high in January leading to a substantial fall in exports.

The onion exports went down during festival season last year as the government increased the minimum export price (MEP) substantially to discourage overseas sales. The average MEP went as high as $495 a tonne.

Besides, the Centre had also slowed down the process of issuing export permit and had made license mandatory for undertaking exports.

These measures were aimed at increasing the domestic availability of the bulb to check the rising price of the commodity.

However, the MEP was slashed significantly after the festive season, which has helped in boosting exports. Moreover, the shortage of onion in Pakistan has helped India increase its market share in West Asia.

"Pakistan is not supplying to gulf countries because of non-availability of crops there. So, India is finding good market in West Asia," the official said.

The MEP for February has been cut by $20 a tonne to $165-390 a ton for most of the destinations.

However, for West Asia, the major importers, the MEP is $180-210 a tonne. Bangladesh, Sri Lanka, Malaysia and Singapore are the other major markets.