The Indian government has implemented a stringent measure in the realm of international trade by instituting a minimum export price of $800 per metric ton for onions. This directive, which is slated to remain in force until the culmination of the calendar year on December 31, 2023, has been imposed in response to the escalating cost of this essential root vegetable across the nation.
The Directorate General of Foreign Trade (DGFT) has articulated this mandate, affirming that the exportation of onions now carries the stipulation of a Minimum Export Price (MEP) set at US $800 F.O.B per Metric Ton (MT). This policy transformation is set to take effect commencing on Sunday, October 29. The DGFT has also delineated certain exemptions to this newly enacted regulation. Specifically, it has outlined that consignments of onions designated for export that were previously delivered to Customs are to be exempt from this directive, as are shipments for which the export duty was remitted prior to the issuance of this notification.
Moreover, the directive specifies that in cases where onion consignments were relinquished to Customs before the announcement and were duly registered in the Customs system or where onion consignments had reached the Customs station for exportation prior to the issuance of this notification, these consignments shall be absolved from the MEP requirement.
The decision to introduce this MEP for onions, an essential ingredient in Indian cuisine, comes at a juncture when the average wholesale price of onions has witnessed a substantial uptick. Specifically, the Lasalgaon Agriculture Produce Market Committee (APMC) in Maharashtra, which serves as a benchmark for onion pricing, has seen a nearly 60% escalation in onion prices over the past fortnight. The rise is particularly striking, with an 18% increase observed in just the previous week. In select markets of Maharashtra and the national capital of Delhi, the zenith of onion prices has reached a notable Rs 50 per kilogram. It is prognosticated that onion prices will continue to ascend until the advent of the new kharif crop in December, which is anticipated to arrive with a delay of approximately two months.
To provide a concrete illustration, the retail market in the national capital has witnessed a further surge in onion prices, with rates ranging between Rs 65 and Rs 80 per kilogram. Prominent retailers such as Mother Dairy and the e-commerce platform Bigbasket have been compelled to offer onions at prices ranging from Rs 67 to Rs 70 per kilogram, reflecting the evolving dynamics of the onion market.
In summary, the institution of the MEP for onion exports reflects the Indian government’s strategic move to regulate and stabilize onion prices in response to the prevailing market dynamics and the importance of this essential vegetable in the country’s culinary landscape.
