Govt imposes $850/tonne MEP on onion exports; move aims at bringing down spiralling domestic prices

New Delhi: The government on Friday imposed a minimum onion export price of $850 per tonne to curb its shipments and help bring down spiralling domestic prices. Onion prices have risen to about Rs 40-50 per kg in the national capital from Rs 20-30 per kg a few days back. The Minimum Export Price (MEP) is the rate below which no exports are allowed. [caption id="attachment_2406650" align="alignleft" width="380"]

Representational image. PTI[/caption]"Export of all varieties of onions...will be allowed only on letter of credit subject to a minimum export price of $850 FOB (freight on board) per metric ton till further orders," the Directorate General of Foreign Trade (DGFT) said in a notification. The Centre last month warned of strict action against hoarding of onion amid supply disruption fears due to floods in parts of major growing states - Maharashtra and Karnataka. Parts of major onion producing states, including Maharashtra and Karnataka, are reeling under floods, raising fears of supply disruption. It had been decided to cap the retail price of onion at Safal (Mother Dairy outlet) at Rs 23.90 per kg (for Grade A variety). Retail inflation inched up marginally to 3.21 percent in August from 3.15 percent in July, mainly due to costlier food items. The country exports on an average 15 lakh tonnes of onions a year. India produces around 17-18 million tonnes of onion per year.