Onion exports from the country increased by 23 per cent in volume during April-August but dropped in value by 27 per cent during the period.
Exports in the first five months have been pegged at 7.9 lakh tonnes against 6.41 lakh tonnes during the same period a year ago. Earnings from exports were pegged at Rs 547.90 crore against Rs 756.50 crore.
Shipments increased primarily since they were offered at costs that were 40 per cent lower than last year. For the whole of last year, the unit value of realisation from a tonne of onion was Rs 13,790. This year, the realisation, so far, has been Rs 6,934.
The competitive offering of onions has been possible mainly since the Centre lowered the minimum export floor price (MEP) for onion to $125 a tonne since April. During the same period last year, the MEP ranged between $200 and $250.
A feature of this year’s export has been that shipments were over 1.5 lakh tonnes every month, barring August when it dropped to 1.39 lakh tonnes. One reason for the drop was buyers placing lower orders in view of monsoon, while poor quality of arrivals was another reason.
August and September are periods when exports slow in view of monsoon. Also, it is when farmers generally tend to run out of stocks or would prefer to push only those grades that are vulnerable to damage.
Expectation of the new crop that generally arrives during September-end in the market also adds to the factor.
Constant demand
According to export sources, there has been a constant demand this year from the Gulf countries in particular. In addition, there has been good buying from Far-Eastern nations, especially Indonesia.
The Centre had begun fixing the MEP to check exports which were seen as a primary reason for onion prices soaring to over Rs 100 a kg in retail outlets during December 2010 and again in February 2011. In fact, the Centre had banned exports in January 2011 before removing it in February following protests from growers.
Onion production during 2011-12 was a record 15.39 million tonnes against 15.11 million tonnes the previous year. Of this, Maharashtra’s contribution was 5.03 million tonnes (4.9 million tonnes) during the period despite the area under the crop being lower.