Farmers say that there is a lot of onion in the market, the ban on exports will bring prices at Rs 2-3 / kg.
Impact of Onion Export Ban on Consumer, Traders and Farmers
In India, onion is not only an important part of the kitchen, but it is also a very politically sensitive commodity. Whenever there is a sharp rise in the prices of onions, then not only the budget of the kitchen of the common man gets spoiled, but the governments also start to get upset. Seeing the retail prices of onions in the domestic market for the last two weeks, the government decided to ban the export of onions with immediate effect on Monday night.
However, onion growers and traders are not happy with this decision. They believe that there is a lot of inward in the market, in such a situation, if the exports are stopped then they will be a very loss. Experts are assuming that the government has taken this step soon, taking lessons from the situation of the previous year. Certainly, traders and farmers will be unhappy, but there may be stability in prices further, which will give relief to the common man. Onion prices reached Rs 100 / kg in December last year.
Onion is an essential commodity in the country. The Ministry of Food and Consumer Affairs regularly monitors onion prices. According to the information available on the website of the ministry, on 14 September the retail price of onion in the capital Delhi reached 41 rupees / kg. The special thing is that just three months ago, the Narendra Modi-led central government changed the old Essential Commodities Act, 1955, regarding the ban on stock limits and exports of grains, edible oils, potatoes, onions, tomatoes and other essential commodities. Made the necessary changes. As per the changes, stock limits or export restrictions can be imposed only at the time of very serious situation like war or natural disaster.
Will onion prices continue to rise now?
It is estimated that prices of onion will continue to rise further. This is because the unlock process will progress further, as well as the festive season is about to begin. In such a situation, demand is bound to increase. The arrival of the new onion crop will be done only after November. In such a situation, the trend in prices will continue.
On the other hand, this year too, there was a lot of monsoon rains in many states, due to which the onion crop was spoiled in many areas. This year, due to rains in Karnataka, the ready to enter the market has completely deteriorated. In the first week of September, this crop was going to come in the market. Apart from this, onions kept in stores in Madhya Pradesh, Gujarat and parts of Maharashtra also came out.
Why are farmers and traders worried?
The farmers of Nashik in Maharashtra say that the ban on onion exports is not a fair decision of the government. In an interview with ANI, farmers say that onions are coming in large quantities in the market. What do we do in this crop, where will we sell it? Onion growers are also fearing a drop in prices. He says that onion is being sold in Nashik Mandi at Rs 20-25 per kg. If the export is banned then these prices will come to Rs 2 to 3 per kg. Farmers will suffer a huge loss.
The government believes that onion exports have jumped 30 per cent from April to July. Due to this, onion availability in the domestic market has come down. On the other hand, the retail inflation data for August also has alerted the government on the onion. The retail inflation rate (CPI) was 6.69 percent in August, marginally lower than 6.73 percent in July. However, it remains above the Reserve Bank (RBI) target of 6 per cent. Food inflation in August was also above 9 percent at 9.05 percent, which was 9.27 percent in July.
Common man will get relief: expert
On the decision to ban onion exports, Ajay Kedia of Kedia Commodity says that traders and farmers in Lasalgaon Mandi are unhappy with the government’s decision. The farmers were upset with COVID, now they have become more upset. Farmers are upset due to COVID epidemic, prices were getting good but they are a bit worried about the export stopped. But, if the prices stop further, the common man will get relief.
Kedia says that the government took an immediate decision this time keeping in view the situation of the previous year. Last year too, onion crop was damaged due to heavy rains in August and September. The crop was submerged by water in Sangli, Kolhapur, Nashik. Due to this, prices had increased sharply since December, January. To prevent this from happening again, the government banned exports. Whenever such an epidemic occurs, food inflation rises. With this, price stability will be seen now.
$ 440 million exports in FY20
According to government data, in the fiscal year 2020, the government exported fresh onions worth $ 328 million and dry onions for $ 112.3 million. Prices in neighbouring country Bangladesh have jumped more than 50 percent due to ban onion exports. India is the largest onion exporter in Bangladesh. Onion exports to Bangladesh jumped 158 percent during the April-July period.
Let me tell you, last year the government had banned the export of onions on September 29 and imposed a stock limit across the country. The government had taken this step to stop the furious increase in onion prices. Before the Maharashtra and Haryana assembly elections, onion prices had risen sharply.
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