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With onion prices at their lowest level in calendar year 2018, exporters said the Centre should bring back incentives to ship out more bulbs, to help stabilise prices and provide better returns to farmers. As the harvest of the rabi onion crop gains pace across the key producing regions of Maharashtra and Karnataka, prices have declined drastically, leaving growers in tears.
At Lasalgaon, the largest onion market in the country, prices have crashed by over 80 per cent since early January to their lowest level for the year. At the retail end, onions are being sold at ₹10-15 per kg across cities.
Harvested now, the rabi crop, which accounts for 65 per cent of the country’s onion output of around 21 million tonnes, is stored and supplied till the kharif crop is harvested in October. “The crop has been good in all producing regions and that’s influencing prices,” said Jaidutt Holkar, Chairman of the Lasalgaon APMC. He expects prices to stay at these levels for several weeks. Nodal co-operative agency NAFED is expected to begin buying 25,000 tonnes in Lasalgaon this week.
The steady fall in prices and removal of the minimum export price has resulted in increase of shipments overseas. “There is good regular demand coming in from countries in the Gulf, Sri Lanka and the Far East,” said Ajit Shah, an exporter in Mumbai and President of the Horticulture Produce Exporters Association. Per DGCIS data, onion exports during the April-January period stood at 12.97 lakh tonnes valued at ₹2,609 crore as against 24.15 lakh tonnes valued at ₹3,106 crore in 2016-17.
“To increase exports, the Centre has to reintroduce the 5 per cent incentive (under the Merchandise Export from India Scheme), which would help us compete,” Shah said. The Centre had withdrawn the incentive last September.
Despite having a better quality product, Indian exporters face stiff competition from their Pakistani counterparts as the latter have a better costing advantage due to their weak currency against the dollar, Shah said. The Pakistani onions are priced cheaper by 5-10 per cent cheaper due to their currency advantage.
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