India bans onion exports, Maharashtra farmers agitate for its removal

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A day after the Centre banned exports of onions to contain a spike in domestic prices, farmers in the largest onion cultivating state of Maharashtra, held agitations, calling the move “arbitrary”, seeking removal of the ban. Prices of onions at Lasalgaon, Nashik,  the country’s biggest onion market in Maharashtra, have doubled to Rs 3,000 per quintal since March.

Farmers from Lasalgaon, Nasik, Ahmednagar, Akola, Solapur and Pabhani, among others, blocked state highways. The farmers’ are complaining that the sudden and arbitrary decision of the government would drag down their returns just after they started to get better prices for their produce.

Onion prices, which remained benign until August, witnessed a sudden surge in the month of September, forcing the government to immediately ban the exports of all varieties of onions. Onion price was Rs 20-22 per kg during June-August, but it dramatically rose to Rs 30 per kg, in September, according to the Price Monitoring Division of the Department of Consumer Affairs.

In fact, it is the recent surge in onion prices, which forced the centre to ban onion exports.  Last year too, India had banned the exports of onions due to a rise in prices and set the minimum export price (MEP) of onion at $850 a tonne to curb its shipments. However, the MEP was lifted in March this year, and onions were made free for export.

The current rise in prices of onions is being attributed to the massive destruction of crops due to moisture during heavy monsoon downpours. Heavy rains washed away the crop in states, including Karnataka, Madhya Pradesh and Gujarat.

Farmers and several noted economists are also taken aback by this move by the government, calling it anti-famer and the government’s urban bias. “When onion prices collapse to Rs 5/kg, no one comes to support. But when prices go to Rs 30/kg, all hell breaks loose to pull the prices down,” asked Ashok Gulati, a noted economist in a Financial Express report.

Containers have been stopped at JNPT port and hundreds of trucks have been stopped at the Bangladesh border. This has hit onion prices which have dropped to Rs 2,000 per quintal within a day which means losses for farmers again. According to onion traders in Nashik, around 450 containers are stuck at the JNPT port.

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