Onion prices tumble further

The NAFED has sought clarifications on its role as a canalising agency for the 75,000 tonnes of onions to be exported till May 31. NAFED and exporters remained away from the markets today.

The Lasalgaon market, which reopened today after the weekend, received 900 tractor-trailors (each carrying about 30 quintals of onions). The prices ranged from Rs 101 to Rs 240 per quintal, the average being Rs 180 per quintal. ThePimpalgaon-Baswant marketyard received 700 tractor-trailors and prices ranged from Rs 200 to Rs 268 per quintal, the average being Rs 235 per quintal.

Together, the arrivals in a single day today at Lasalgaon and Pimpalgaon-Baswant were a whopping 4,800 tonnes. The arrivals are likely to remain steady and the situation likely to worsen for the farmer with the next onion crop due for harvest in April.

Farmers have resorted to a panic sale of their produce as the late kharif crop being harvested is highly perishable and has to be consumed within a month. The cost of production of onions, according to official agencies, is around Rs 280 per quintal.

MSAMF, which has been authorised by the Commerce Ministry to canalise 75,000 tonnes of onion exports up to May 31, is yet to clear even a single consignment. Exporters in Nashik pointed out that the MSAMF, instead of clearing export consignments promptly, had chosen to impose new restrictions on exporters, causing further delay.

Exporters stated that theagency had decided to issue clearances only after evaluating their performance in the last three years. Further, after fresh registrations, the MSAMF had decided to fix quotas for export regionwise. A delegation of exporters is in Pune to meet officials of the MSAMF. The Minimum Export Price (MEP), which used to be fixed by NAFED (as the only canalising agency for onion exports), is yet to be announced by the MSAMF.

The Union Government had banned onion exporters from January 12 to March 3 last year. Exports were again banned from October 8, when prices had skyrocketed up to an all-time high of Rs 4,000 per quintal (Rs 40 per kilo) in the wholesale markets. The ban was in force till January 31, 1999. However, on January 22, the Commerce Ministry relaxed the ban, allowing exports of the Bangalore Rose’ variety of onions grown in Karnataka and the Krishnapuram’ variety of onions grown in Andhra Pradesh. For all other varieties, exports were allowed only upto 3,000 tonnes.

When arrivals increased in theimportant late kharif markets in Maharashtra and Gujarat, the Commerce Ministry issued a notification on February 12, allowing exports up to 75,000 tonnes till May 31. However, the notification led to confusion, as it granted the whole quota of export to the MSAMF, and did not specify how much NAFED would be authorised to canalise.

The NAFED presumed that as the canalising agency, the notification had not specified any export quota for it. Hence, it started clearing consignments for exports. Within a week, consignments of about 10,000 tonnes of onions were cleared. However, the Customs stopped the shipment last week, demanding a specific order from the Commerce Ministry on NAFED’s quota of exports.

Through the Agriculture Ministry, NAFED requested the Commerce Ministry to at least allow consignments which it had already cleared. NAFED stopped clearing consignments from Friday last, seeking clarifications from the Commerce Ministry on its role in canalising onion exports.

The Maharashtra Government wokeup too late. After a week of the Commerce Ministry’s notification and the consequent confusion it created on NAFED’s authorised consignments, it appointed the MSAMF as the official agency to canalise the 75,000 tonnes of exports till May 31. The agency was appointed last weekend.

Meanwhile, the new crop continues to flood the wholesale markets in Nashik and Pune districts. Official agencies have predicted a bumper onion crop during the current year (Kharif 19998 to Rabi 1999) of upto 47 lakh tonnes in the country, as against the normal of 42 lakh tonnes. Last year, the yield was only about 36 lakh tonnes. Incidentally, 4.48 lakh tonnes of onions were exported during 1997-98. During 1998-99, the exports have been about 2.12 lakh tonnes.