Due to unseasonal rainfall damaging onion crops in Maharashtra and causing a surge in domestic prices to INR 40/kg in wholesale trade, India has implemented a ban on onion exports until March 31, 2024. Traders and farmers anticipate a significant decline in onion prices in January as a result of this measure.
Central government officials recently conducted field surveys in Maharashtra to evaluate the impact of unseasonal rainfall. Over the past few weeks, the prices of onions have risen to INR 38-41/kg in wholesale trade for high-quality onions. This increase is attributed to robust export demand from Bangladesh, which has provided support to domestic prices.
Traders mentioned that prices were expected to stabilize within the next week, given the daily increase in arrivals of kharif onions.
“The arrival of late kharif and kharif onions will flood the markets in January, which can bring down the prices to as low as INR 10-15/kg,” said a Pune-based onion trader, who requested not to be identified.
The primary timeframe for onion exports is from December to February, which also benefits farmers as the onions harvested during this period have limited keeping quality. Concerns among trade insiders have arisen, suggesting that the export ban might prompt farmers to reconsider planting rabi onions.
After more than five years, India has waived the import duty on yellow peas, reducing it from 50% to nil. The Ministry of Finance issued the notification to this effect late on Thursday night.
Nevertheless, the trade is anticipating additional clarification from the Director General of Foreign Trade (DGFT).
“There is still the minimum import price of Rs 200/kg in force. Imports cannot take place unless this price restriction is removed,” said Bimal Kothari, president, Indian Pulses and Grains Association (IPGA).
The delayed sowing of rabi chana in Maharashtra and Gujarat is believed to be a factor influencing the decision to eliminate import duties on yellow peas.
India previously imported substantial quantities of yellow peas to address the shortfall in domestic chana production. These imports served as a substitute for chana in the production of chana flour (besna) by the dal mills.
Nevertheless, owing to the initiatives of the central government, India has achieved self-sufficiency in chana. The surplus chana stocks held by the central government played a crucial role in ensuring food security for the impoverished during the Covid years.