Exporters hopeful of getting more orders in the coming week
With onion prices tumbling further from the highs of ₹4,000 a quintal in mid-February, exporters are hoping that they will be able to win more orders from buyers abroad.
“We expect demand for exports to pick up next week. For this week, buyers have ordered Pakistan onion,” said Ajit Shah, President, Horticulture Produce Exporters Association (HPEA).
Modal prices (the rate at which most trades take place) of the bulb have plummeted to ₹1,000 a quintal at Asia’s biggest onion market in Lasalgaon from ₹4,000 on February 20 and ₹2,640 on March 1.
Prices surged during the third week of February after unseasonal rains lashed the growing regions. Since then, the prices have crashed by 75 per cent with the fall this month being over 65 per cent.
According to the Ministry of Consumer Affairs, retail prices of onion in Delhi today were ₹35 a kg, while it was ₹37 in Mumbai. Compared with this, prices on February 23 were ₹48 and ₹67, respectively, in Delhi and Mumbai.
“Arrivals have doubled in markets such as Lasalgaon now, whereas demand remains constant. Prices have dropped sharply that exports can perhaps help in recovery,” said Suvarna Jagtap, Lasalgaon Agricultural Produce Marketing Committee (APMC) Chairperson.
According to Ministry of Agriculture and Farmers’ Welfare data, onion arrivals in Maharashtra increased to 85,500 tonnes during March 8-10 compared with 56,212 tonnes during March 4-6 and 50,492 tonnes during March 1-3.
during March 1-10 this year in Maharashtra is pegged at 1.96 lakh tonnes (lt) compared with 1.57 lt during the year-ago period. However, during January 1-March 10 this year, arrivals are lower at 9.18 lt in Maharashtra (13.48 lt).
Onion modal prices during the same period hovered between ₹1,750 and ₹2,000 a quintal.
Union Minister for Agriculture and Farmers Welfare Narendra Singh Tomar said 87,000 tonnes have been exported during January-February this year after the Centre lifted the ban on its exports.
The Centre banned onion exports in September last year after retail prices topped ₹100 a kg. In addition, the Centre allowed duty-free imports of onion and imposing a stock limit.
In comparison with exports in January-February this year, shipments during the same period last year were 12,564 tonnes. Before the Centre banned onion exports, its shipments during the April-September period of the current fiscal at 13.07 lt exceeded last fiscal’s total exports of 11.49 lt. During the 2018-19 fiscal, onion exports were at 21.83 lt.
Despite higher exports during January-February, exporters feel they can ship out more.
“There are a few problems with our exports. One, Pakistan onion is priced at least $25 a tonne lower than our produce. Two, some of the overseas buyers say that they still hold stocks of onions bought at a higher price of $400-$500 (₹29,050-36,300) a tonne,” said Agri Commodities Exporters Association (ACEA) President M Madan Prakash.
Currently, Pakistan is quoting $275 (₹20,000) compared with India’s offers at $300 (₹21,800).
Container shortage and shipping vessels availability are other problems worrying exporters with 20-foot container charges more than doubling in the last couple of months.
“We expect export orders to pick up next week when buyers abroad clear their inventories,” said Prakash.
HPEA’s Shah concurred saying, “Even if Indian onion is quoted $50 (₹3,625) a tonne higher, we will have buyers. Our problem is that we were out of the market for some time. Orders will come because our exporters are more committed than other sellers.”
Vikas Chaudhary, an exporter in Nashik, said the quality of Indian onion is superior to onions from other countries, including Pakistan. “No other onion has the taste and pungency as the Indian one.”
Exporters say that the coming week will hold the key to onion exports and are hopeful of bagging good orders.
Source: Business Line