Exports fail to lift onion prices; increased arrivals keep market rates low

PUNE: Export of onions may be robust, but that's no relief for farmers are domestic prices are sliding. Wholesale prices crashed to 5.50/kg in Pune on Monday. Crop input from Maharashtra is on the rise, despite the exporters shifting their procurement base from Nashik to Pune. Trade veterans expect the situation to turn worse by April when the rabi crop hits the market.

After the Central government reduced the minimum export price ( MEP) to $150/tonne in December 2013, exports from Maharashtra boomed, especially from Nashik. Recently, the exporters have shifted their procurement base from Nashik to Pune region comprising of Satara, Kolhapur etc.

The light pink coloured onion coming from this region is better suited for exports due to its slightly longer shelf life. "About 50 to 70 trucks of onions are going from Pune to Mumbai every day for exports. The Dubai-quality onion gets Rs 8.50/kg," said Ganesh Shedage, an onion and potato wholesaler from Pune.

Despite the exports, onion prices have declined by 30-40% during last one month in all the growing areas in Maharashtra, Gujarat and Karnataka. They are likely slide further due to heavy arrival of the bulb everywhere. Markets such as Ahmedabad, Pune etc are getting about 30,000 quintal onion every day from last week.

Trade veterans say the worse is yet to come. "The domestic onion prices may crash further by April as the area under the crop has increased everywhere. The government may have to give subsidy to boost onion exports and support the prices," said CB Holkar, director of National Agricultural Cooperative Marketing Federation of India ( Nafed).