In order to improve the domestic supply and curb prices, the government has hiked the minimum export price (MEP) of onion to $500 per tonne. The decision to increase the onion MEP was taken on June 30 by an Inter-Ministerial Committee. The committee observed that the wholesale and retail prices of onion are going up in producing and consuming mandis and there is no appreciable decline in the exports of onion. MEP is the rate below which no exports are allowed.
The MEP of onion was re-introduced at $300 per tonne last month. This step which was taken last month came barely three months after the previous government in March had abolished it. The prices of onion have been rising due to speculation amid anticipation of below normal monsoon despite sufficient supply in the country. Currently, retail prices of onion have risen to about Rs 25-30 per kg, while the wholesale prices are ruling at Rs 18.50 per kg in the national capital.
Onion production is estimated to have risen to 192 lakh tonnes (LT) during 2013--14 crop year (July - June), from 168 LT in 2012--13. The exports meanwhile fell to 13.58 LT last fiscal from 18.22 LT in 2012--13. The domestic demand during the lean period from June to November is met through stored rabi (winter) and fresh kharif (summer) produce.