Govt imposes minimum export price of $800 per tonne on onion to maintain domestic availability

On Saturday, October 28, the government imposed a minimum export price (MEP) of $800 per tonne on onion exports with effect from October 29, 2023 till December 31, 2023. This is done to improve the availability of vegetable in the local market while keeping prices stable. The MEP of $800 per MT translates into about Rs 67 per kilogramme.

"Exports on onion is free. MEP of USD 800 FOB (free on board) per tonne is imposed till December 31, 2023," the Directorate General of Foreign Trade said in a notification.

In Delhi, onion prices have further risen to Rs 65-80 per kg in the retail market on lower supply.

Mother Dairy, which has around 400 Safal retail stores in the Delhi-NCR, is selling loose onions at Rs 67 per kg. E-commerce portal Bigbasket is selling at Rs 67 per kg, while Otipy is at Rs 70 per kg. However, local vendors are selling onions at Rs 80 per kg.

Along with the decision to impose MEP on onion exports, the government has also announced the procurement of an additional 2 lakh tons of onion for the buffer, over and above the 5 lakh tons already procured. Onion from the buffer has been disposed of continuously from the second week of August in major consumption centers all over the country and also supplied to retail consumers at Rs 25/kg through mobile vans operated by NCCF and NAFED. To date, about 1.70 lakh metric tonnes of onion have been disposed from the buffer. The continuous procurement and disposal of onion from the buffer are undertaken to moderate the prices for consumers while ensuring remunerative prices to the onion farmers.

Around two months back, the Ministry of Finance imposed a 40 per cent export duty on onions. This was also due to rising local prices of the vegetable.