Amid dip in onion prices, traders want export ban scrapped

The main onion-producing regions had first braved a drought and then experienced the late arrival of monsoon, both of which hit production.

As the average traded price of onions continues to slide in most wholesale markets in Maharashtra, traders have raised the pitch to demand lifting the ban on onion exports. Dr Bharati Chavan, the BJP MP from Dindori, which is located in the onion-growing hub of Nashik district, recently raised the matter during the ongoing Budget Session of Parliament.

Chavan pointed out how the export ban has resulted in a sharp dip in prices, and sought immediate scrapping of the ban. A similar demand has been made by Anil Ghanwat, president of the farmers’ union Shetkari Sanghtana, who said unless the export ban was lifted, onion growers will not have a good realisation. Ghanwat warned that the Sanghtana members will take to the streets in case the government failed to lift the ban immediately.
On Thursday, the bulb traded at an average price of Rs 1,600 per quintal at Lasalgaon wholesale market in Niphad taluka of Nashik district, much lower than the average price of Rs 3,455 per quintal in January. Since December, when onions prices had touched a high of Rs 6,000-per quintal, the prices have been falling steadily.

The Centre had taken the step of banning onion exports in September last year, when the vegetable price started spiralling out of control due to a dip in production in the Nashik-Pune-Jalgaon belt. The main onion-producing regions had first braved a drought and then experienced the late arrival of monsoon, both of which hit production.

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In an attempt to cool down prices, the Centre had also allowed free imports of the bulb before the crucial Assembly elections in Maharashtra and Haryana. Despite these steps, the retail price of onions remained above the Rs 100 per-kg mark in November and December.

The higher prices had seen more farmers opting to grow the bulb and as fresh onion crops started arriving in the markets, prices began to fall.
Usually, 20 per cent of onions produced in India are exported, and this helps maintain the prices within a limit and not fall beyond a point.