Onion prices soar by 57%; Govt increases buffer stock sales for consumer relief

The retail price of onions in India has increased by 57 per cent in the past year, to Rs 47 per kg. This is due to a number of factors, including delayed kharif onion sowing and a tight supply situation.

The government has been offloading buffer onions since mid-August to try to stabilize prices. On Friday, the government decided to step up the sale of buffer onions in order to provide relief to consumers.

As per the data shared by the government, the retail price of onion was at Rs 40 per kg on Friday as against Rs 30 per kg in the year-ago period in Delhi.

"We have been offloading buffer onions since mid-August and we are stepping up the retail sale in order to check further rise in prices and provide relief to the consumers," Consumer Affairs Secretary Rohit Kumar Singh told PTI.

According to the ministry, onion is being depleted from buffer stock in both wholesale and retail sectors in states where prices have skyrocketed. Since mid-August, around 1.7 lakh tonne of buffer onion has been offloaded at various locations in 22 states.

Buffer onion is sold in retail markets at a reduced rate of Rs 25 per kg through two cooperative entities, NCCF and NAFED stores and vehicles. Buffer onion is also sold at a reduced price in Delhi.

The weather conditions have been the main factor responsible for this delay, leading to less coverage and late crop arrival, PTI quoted a senior official as saying. During a typical cycle, the new kharif onions would already be hitting the market. 

However, this year, their absence is being acutely felt. The dwindling supplies of stored 'rabi' onions are adding to the woes, resulting in a tightening supply situation. This combination of low accessibility and high demand has inevitably pushed the rates of this kitchen staple northwards in both wholesale and retail markets. 

The official further mentioned that in order to control soaring onion prices and ensure a stable supply within India, the government has proactively doubled its buffer onion stock for the ongoing year. This strategic move has been implemented in light of the expected impact on availability and pricing in the domestic market. 

As per the announcement, for the fiscal year 2023-24, the Consumer Affairs Ministry, acting through the National Cooperative Consumers' Federation of India (NCCF) and the National Agricultural Cooperative Marketing Federation of India (NAFED), has maintained a buffer onion stock of 5 lakh tonnes. Simultaneously, the ministry has made provisions to procure an additional 2 lakh tonnes of onions in the short term.

With PTI inputs

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