Indonesia's Plea For Onions In The Middle Of Export Restrictions 

Indonesia’s Plea For Onions In The Middle Of Export Restrictions  Indonesia Requests 900,000 Tonnes Amid India's Onion Export Ban

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In a surprising turn of events, Indonesia has approached India, urging the export of a whopping 900,000 tonnes of onions. This comes in the wake of India imposing stringent measures, including a 40% export tax, aiming to stabilize domestic onion supply and prices. Despite these efforts, soaring prices forced a complete export ban in December, slated to continue until the end of the 2023-24 financial year.

India’s Dominance and Indonesia’s Contradictory Figures

India, a significant global player with a quarter of the world’s onion output, faces a unique challenge. Indonesia’s request gains significance as it stands as India’s largest trade partner. Intriguingly, Indonesia primarily imports onions from the US, India, and New Zealand. Despite the reported request, the Indonesian embassy in New Delhi offers contradictory figures, stating that India accounts for only 79,000 tonnes out of a total import of 194,107 tonnes in 2023. Post the export ban, exporters encountered setbacks, with detained containers at port gates. Market experts, shed light on the grim situation, highlighting the $0,30 or €0,27 per kg losses faced by exporters for each container. Unanswered queries to key ministries add to the uncertainty around this onion exports.

Production Challenges In Onion and Political Debates

India grapples with onion production challenges stemming from erratic rains and extended dry spells, resulting in a decline in cultivation area and production. In Maharashtra, the top onion grower, cultivation area plummeted by 96%, leading to a 94% decline in production. Karnataka, the second-largest grower, witnessed a significant reduction in acreage and production. Government assessments project a substantial drop in onion production for the 2023-24 kharif and late kharif seasons. Farmers face mounting challenges, with debt burdens increasing significantly. Despite adverse weather conditions, onion farmers exhibit resilience.

Onion Market Forecast

On the retail front, the average price of onions surged by 49.6%, standing at $0,50 or €0,45 a kg. The absence of exporters from the market due to this ban has contributed to further declines, with expectations of continued price drops. Looking ahead, the onion market is experiencing complex movements, balancing export demands, production challenges, and the resilience of farmers.

The clash between India’s export restrictions and Indonesia’s plea underscores the intricate global interdependence in food trade. India’s challenges in onion production raise concerns about food security. The impact on exporters and the uncertainty surrounding the situation reveal the need for transparent communication and cooperative solutions.

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