The Agricultural Produce Market Committee (APMC) in Lasalgaon of Nashik, India's biggest wholesale market for onion, has demanded lifting of the ban on the export of the kitchen staple arguing the supply of the bulb has gone up due to the arrival of Rabi crop.

In December last year, India banned onion exports until March 31 this year to tame its rising domestic prices.

India has recently okayed export of 50,000 tonnes of onion to Bangladesh following a specific request from Dhaka for Ramzan and Eid-ul-Fitr, which is slated for April.

"Since the imposition of exports ban last year, the mandi (wholesale market) prices declined to Rs 1,500 a quintal on Tuesday from around Rs 4,500 a quintal prevailed prior to the imposition of shipment ban last year," Jaydutt Holkar, APMC director in Lasalgaon, told reporters.

He said onion prices are expected to fall further with the arrivals of Rabi crops, which is set to peak in the next few weeks.

The Rabi harvest makes up nearly 60 percent of the total onion production.

"Current prices of Rs 1,500 a quintal does not even cover the cost of the production of onion," Balasaheb Misal, former director of Manmard (Maharashtra) mandi board and an onion farmer, told Financial Express.

In August last year, India had imposed a minimum export price (MEP) of onion at $800 a tonne to disincentivise overseas shipment of the commodity.

The agriculture ministry estimates onion production to fall by 16 percent to 25.47 million tonnes in the current crop year due to a production decline of 3.43 million tonnes in Maharashtra, the biggest producer of the bulb.