Centre sets minimum export price for onion as prices surge to highest in two years
The cap on export prices will boost domestic supplies and discourage cheap export, the government said.
The government on Thursday imposed a minimum price of $850 (about Rs 55,000) a tonne for the export of onions till the end of the year. The decision comes in the wake of rising prices of the vegetable, which reached their highest in two years last week.
The government wants to “ensure domestic availability of onion and to discourage cheap export from the country”, Food Minister Ram Vilas Paswan said on Twitter.
When lack of supplies lifts prices, the government imposes such limits to discourage overseas traders from buying the commodity. However, a Mumbai-based exporter told Reuters that selling onion for $850 a tonne in the overseas market was not feasible, as onions from Egypt and Pakistan were cheaper.
Onion prices at Lasalgaon, India’s largest wholesale market of the vegetable, averaged Rs 3,211 per 100 kg last week – the highest in two years. Prices are expected to ease when kharif onions arrive in the market.