On Saturday, the central government announced the removal of a 20% export duty on onions, a measure that had been in place since September 2024. This significant change, set to take effect on April 1, 2025, aims to bolster both domestic availability and farmer earnings. The Department of Revenue’s recent notification reflects a strategic response to the evolving market conditions, as highlighted by the Department of Consumer Affairs.

Changes in Export Regulations

To ensure an adequate supply of onions within the country, the government previously implemented various restrictions on exports, including duties and a minimum export price (MEP). These measures were enforced from December 8, 2023, to May 3, 2024. Despite these efforts, onion exports remained vibrant, with total exports reaching 17.17 lakh tonnes during the 2023-24 period and 11.65 lakh tonnes by March 18, 2025.

• Export Trends:
  • September 2024: 0.72 lakh tonnes
  • January 2025: 1.85 lakh tonnes

Government’s Commitment to Farmers

The Ministry of Consumer Affairs, Food & Public Distribution emphasized that this decision reflects the government’s dedication to providing fair prices for farmers while ensuring that consumers can afford onions during this key period. The release noted that current mandi (market) prices, while higher than the previous year’s levels, have seen a 39% decline in the all-India weighted average modal prices. Additionally, retail onion prices have dropped by 10% in just one month.

Increased Onion Arrivals

Onion arrivals at major markets like Lasalgoan and Pimpalgaon have surged this month, contributing to the improved market situation. According to the Department of Agriculture and Farmers Welfare, the rabi onion production for this year is projected at 227 lakh metric tonnes, marking an increase of over 18% from last year’s 192 lakh tonnes. This seasonal crop is vital, as it accounts for 70-75% of India’s total onion output, providing essential stability in prices until the kharif crop arrives around October/November.

• Key Production Estimate:
  • Current Rabi Production: 227 lakh metric tonnes

Looking Ahead

The anticipated rise in production this season is expected to further stabilize onion pricing in the months to come. As the market adapts to these changes, both consumers and farmers stand to benefit, ensuring a balanced and sustainable approach to onion availability in India.

By keeping a close eye on these developments, stakeholders can navigate the onion market effectively, promoting both agricultural health and consumer accessibility.