In the wake of a lower output of rabi and kharif crops for the year 2023-24, the Central government of India has decided to lift the long-standing ban on exporting onions. Starting off with six neighbouring countries as a way of meeting the increased demand in the global market, the National Cooperative Exports Limited (NCEL) have been handed the responsibility of managing exports to Bhutan, Bangladesh, Bahrain, Mauritius and the UAE. By sourcing and supplying the onions to government-nominated agencies in these countries, exports will take place with payments cleared in advance.
In addition to the staple red variety that is commonly consumed in India, a 2,000 metric tonne shipment of white onions is all set to hit the markets in the Middle East as well as a select few European countries. A combination of high production costs, stringent agricultural practices and maximum residue limits, white onions have a higher export value compared to their red counterpart. Announced in early December of 2023, the ban on exporting onions led to a surge in domestic supply and a drop in wholesale as well as retail prices in local markets.
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While multiple farmer associations have since claimed that the ban – which was meant to be lifted on March 31, continued to prevail as a fresh ban was imposed on March 22 this year, the announcement by the Central government is yet to trickle down to onion farmers. The ban, which allowed for a drop in prices of the fluctuating commodity, was looked upon as a solution to the damage of crops and poor rainfall – leading to a smaller yield than what was expected last year. Extended in March of 2024, the government sanctioned export permits for 50,000 tonnes and 14,400 tonnes to Bangladesh and the UAE in April.