Onions freed from minimum export price restriction

NEW DELHI: Two weeks after it reduced the minimum export price ( MEP) of onions to $400 per tonne, the government has now freed the kitchen staple from this restriction due to abundance of the crop.

“All varieties of onions as described above can be exported without any MEP,” said the Directorate General of Foreign Trade in a notification.

MEP is a tool used to restrict exports and improve domestic supply of farm products.

On December 11, the government slashed the MEP of onions to $400 per tonne from $700 a tonne due to increased production thanks to increased arrival of the kharif crop and loss of export markets of Dubai and Sri Lanka to Egyptian traders.

“This is a timely decision by the government because there is plenty of onion crop now since the new crop has come. The retail price of onion is now almost Rs 20 per kg,” said an official.

Adverse weather conditions including unseasonal rains had hit the production of onions from 189.23 lakh tonnes in 2014-15 as against 194.02 lakh tonnes in 2013-14. leading to skyrocketing of onion prices which led the government to increase the MEP to $700 per tonne in August.