Onion exports collapse

The onion is a "sensitive" products in India and its price fluctuates with far reaching consequences (see news 23.03.11).

Onion exports fell 22% in the period April-November 2011 and totaled 905,150 tons against 1.12 million tons during the same period last year. Onion production is estimated at 15.14 million tons in 2011-12 (July-June), higher than the previous year which stood at 14.56 mt.

To avoid a popular revolt the government had previously intervened to keep prices down, but increased the minimum export price (MEP). But after a good harvest that removed the risk of shortages, exports have greatly slowed, hindered by the MEP. The government has since reduced the MEP from $400 per tons to $350 and then to $250.

India is the second largest producer of onions in the world after China, which dominates the international market with a price of $210 per ton.

source : business standard com india, money control