The government on Saturday lifted the ban on onion exports, a politically sensitive move ahead of the elections in Maharashtra. The decision comes with a minimum export price (MEP) of $550 per metric tonne, coupled with a 40 per cent duty on shipments.

Consumer affairs secretary Nidhi Khare said the lifting of the ban would not lead to any price rise in retail markets. “Prices will remain stable. If at all there is any increase, it should be very marginal,” she said, while asserting that the government is committed to protect the interests of both consumers and farmers.

Khare said the “ban on onion exports has been removed from Saturday because the supply situation is comfortable and prices are stable in both mandies as well as retail markets”. The modal price at Lasalgaon mandi in Nashik was ₹15 per kg in April.

She said the decision has been taken after considering the latest estimates of onion production in the rabi season at 191 lakh tonnes, which is comfortable. Availability and prices of onion in global markets were also factored in while taking this decision.

The secretary said the monthly domestic demand of onion is around 17 lakh tonnes. “Lifting of the ban would also encourage the farmers to put more area under onions. The monsoon forecast is above normal,” Khare said.

Analysts predict this could translate to onion prices not dipping below ₹60 per kg, leading to an uptick in onion costs in the coming weeks.

Lasalgaon Agricultural Produce Marketing Committee, Asia’s largest onion market, saw prices skyrocketing to ₹2,100 per quintal on May 4, with peaks reaching ₹2,500. Maharashtra, a significant onion-producing state, exports its produce to at least 20 countries.

The secretary said the government is procuring 5 lakh tonnes of onions as buffer stock so that it can intervene in the market in case of a price rise.

“We are monitoring the prices of all essential food items. We will watch the availability and price situation,” she added.