Till end 2023, the minimum price for India’s onion exports will stop at $800/ton, the government warned October 28, to bolster home supplies. 

From October 31 to December 31, 2023 all freight-on-board (FOB) onion shipments will have to adhere to the new regulation.

Delhi cites the insufficient harvest from the rabi crop (winter season) as inadequate to meet home demand, hence the precaution.

The announcement follows an August, 2023 injection of 40% duty on India’s onion exports, again to curb outbound shipments. 

A government official stated that the duty barely deters exports since suppliers recover the costs abroad where onions are costlier. 

The new minimum export price (MEP) of 67 rupees, far above wholesale prices, will be nearly insurmountable for would-be-exporters. 

As an extra measure, the government has also upped its onion reserve bank from the 500,000-ton current procurement to 700,000 tons. 

 India’s next onion harvest, especially from the endowed Nashik district in Maharashtra, has delayed this monsoon (kharif) from late planting.  Interestingly, the district did ship 18,000 tons of the crop in the first half of October despite the export tax.

The state of onion shortage in India is already telling on street merchant prices. In this final week of October, a kg of onion retails for INR 50 to 60 ($0.60-0.72).  This is double last week’s price of INR 25-30 a kg in the streets of Delhi. 

Last week’s highest price for onion in India was in Maharashtra, where the commodity cost 33 rupees ($0.40) a kilo. The development surprised price watchers as this onion belt region usually sets the benchmark for national onion pricing.

So, as pressure on onions continues to rock India, the kitchen staple is meantime staying for good in its favourite country.