ISLAMABAD: Despite a bumper crop of onion this year, the export target is not being met due to barriers including high export value of $400 per metric tonne (MT) and exorbitantly high freight charges by shipping companies.
All Pakistan Fruit & Vegetable Exporters, Importers & Merchants Association (PFVA) has sent a letter to the Ministry of Commerce (MoC) and Ministry of National Food Security & Research (MNFS&R) in this regard.
As per the letter, following bumper crop, the price of onion has been slashed to Rs20 per Kg in the local market; however, despite surplus production, export of the vegetable remains low.
The association has urged the government to reduce the export value to $300 per MT in accordance with ground realities.
On the other hand, the letter states that an acute shortage of reefer containers and exorbitant high freight charges by shipping companies is most likely to jeopardise PFVA’s efforts to enhance the export of onion by taking advantage of the current bumper crop.
“If the country experiences shortage of onion leading to an increase in price in the local market, the PFVA would play its role effectively suspending exports to stabilise local prices, as it has done in the past,” the letter assures.
According to the association, currently, 150- 175 trucks of onions are arriving in the local fruits and vegetable market of Karachi wherein one truck carries 12 tonnes of onion per day. “This amount is going to further multiply in days to follow thus exceeding much beyond the local demand and hence the current price is likely to drop significantly. If the export is not facilitated by resolution of the above stated issues, growers as well exporters would sustain high financial losses,” the letters adds.
The letter explains that if the export of onion drops or is stopped by exporters, growers are likely to suffer the most as they may be unable to recover the cost of harvesting, let alone making the thinnest profit, which would mean that they would naturally switch over to other crops that pay rich dividends.
“It would then lead to an acute shortage of onions next year and the government may not have any other option but to import the same, having a negative impact on our foreign currency reserve,” an official of PFVA said.
