MUMBAI: India set a minimum price of $850 (Rs 54, 913) per tonne for overseas sale of onions, a government order said on Thursday, as the price of the politically-sensitive vegetable surged to its highest in two years in the local market.
Traders cannot export onions below $850 per tonne until the end of 2017, the order said.
"The government has notified MEP of onion at $850 per tonne to ensure domestic availability of onion and to discourage cheap export from the country," said Union Consumer Affairs Minister Ram Vilas Paswan in a tweet.
Average prices at Lasalgaon, India's largest wholesale onion market in the western state of Maharashtra, rose to 3,211 rupees ($49.62) per 100 kg last week, the highest in two years.
"Exports are not possible at $850. Egypt and Pakistan are selling at much lower level," said a Mumbai-based exporter, who declined to be named.
On Thursday, onion were sold at average Rs 47 per kg in Delhi, while its prices had reached to Rs 68 per kg in Shimla, as per the ministry.
On Wednesday, Paswan had said the public sector body MMTC would import 2,000 tonnes of onion.
In addition, the National Agricultural Cooperative Marketing Federation of India was procuring 10,000 tonnes and the Small Farmers Agriculture-business Consortium was asked to buy about 2,000 tonnes from farmers to boost supply of the staple, he had said.
The Indian curbs on exports could lift prices in key importing countries like Bangladesh, Malaysia, the United Arab Emirates and Sri Lanka, traders said.
(With IANS inputs)