Onion export ban leaves Bengaluru exporters in tears after loss of Rs 40 lakh in one week

The sudden ban on export of Onions imposed last week has left leading exporters of the bulb from the City to Asian countries reeling. They have already lost lakhs by selling stocks held at ports within India at half the price and are desperate for an immediate solution.

The Directorate General of Foreign Trade banned exports on September 14 following a shortage in the Indian market after rains played havoc in production areas in Karnataka and Maharashtra. This caused a spike in selling price with Onion selling upto Rs 50 per kg in Mumbai and Pune.

The biggest onion exporter from Bengaluru, S Anandan, Proprietor of K Venkatesh & Co, based in Yesvantpur APMC yard, is under enormous mental and financial stress presently. He buys onions daily from farmers in Challakere in Chitradurga and many of its surrounding areas including Hiriyur, Imangala, Belaghatta, Koverahatti.

Anandan told that “I have lost over Rs 40 lakh just this week. These are my consignments that got stuck at different ports as soon as the ban was suddenly announced – 1,74,000 kilograms at Chennai port, 2 lakh kgs at Kolkata port, 1,50,000 kgs at Tuticorin and 98,000 kgs at Chennai port. They were intended for Sri Lanka, Bangladesh, Bahrain, Malaysia, Vietnam and Hongkong.”

Stressing that onions stored in closed containers would perish in a week, Anandan said that he offloaded the stock at Chennai and Tuticorin at half the price locally. “Despite the government stating a couple of days ago that some relaxation has been permitted in case of Bangladesh alone, my products heading to that country were not permitted to leave the ports,” he added.

Sandeep N V of Shree NN Enterprises said that farmers are bound to have huge losses. “It is not just exporters but this kind of a ban impacts farmers in Nasik and Chitradurga heavily as they will only have a domestic market for their produce. The same problem happened last year too.”

On the losses his concern suffered, Sandeep added, “I had 1 lakh kgs of onions each at both Tuticorin and Mumbai ports for export. I sold them all in the local market last week and suffered a total loss of Rs 7.5 lakh. This is a big sum for a small time exporter like me.”

The exporter that it was crucial that the Centre provides a little time to the traders before such bans are announced. “Trucks from other parts of State take three to four days to reach different ports. Announcing such a move when goods are stuck midway is very tough for our businesses. The same thing was done by the Centre last year too (September 29, 2019),” he added.

President of Horticultural Produce Exporters Association (referred to commonly as Onion Exporters Assn), Mumbai, Ajit Shah told “The Indian Onion market is huge and exports 17 lakh to 18 lakh tonnes of onion annually. A high-level meeting was held yesterday in this connection and those in the know of things tell me that a positive outcome can be expected,” he said.