Govt slashes onion export price to US$ 350 per tonne

The government on Tuesday slashed the minimum export price (MEP) for onion, for the second time this month, to US$ 350 per tonne from US$ 450 per tonne earlier. "MEP of onion, other than Bangalore Rose Onions and Krishnapuram onions, will be US$ 350 per metric tonne," the directorate general of foreign trade said in a notification. On March 1, the MEP was brought down to US$ 450 per tonne from US$ 600 a tonne.Last month, the government had lifted ban on onion exports after farmers protested a crash in domestic prices. It, however, capped the MEP at a higher level of US$ 600 per tonne as a precautionary measure to control local prices, which had shot up to Rs70-80 per kg in December last year.However, agriculture minister Sharad Pawar had subsequently indicated that the MEP of US$ 600 per tonne was almost double the prevailing rate in international markets, rendering them uncompetitive. The MEP for Bangalore Rose and Krishnapuram onions was US$ 1,400 per tonne.The government had imposed a ban on export of the kitchen staple after its prices skyrocketed and touched as high as Rs80-85 per kg.Onion production in the country is likely to be around 10.5 million tonnes in 2010-11, down from 12 million tonnes last year.Furthermore, the DGFT said the MEP for Sona Masuri and Ponni Samba - varieties of non-basmati rice - will be US$ 850. However, no MEP has been prescribed for Matta rice.Partially lifting a three-year old ban on export of non-basmati rice, the government had permitted overseas shipments of Ponni Samba and Matta varieties of basmati, subject to a cap of 25,000 tonnes each. Shipments of one lakh tonne of Sona Masuri were permitted last month.