Govt raises onion procurement price by 13% to Rs 2,125/quintal to ensure better returns for farmers
New Delhi, July 4
The Government has increased the procurement price of onions for the Price Stabilisation Buffer by 13 per cent, from Rs 1,875 per quintal to Rs 2,125 per quintal.
According to the Ministry of Consumer Affairs, Food & Public Distribution, the revised procurement price is effective from 4 July 2026. Procurement of onions through NAFED and NCCF for the Government's Price Stabilisation Buffer is in progress. The revised procurement price will ensure better returns for onion farmers while supporting buffer procurement efforts.
As per the Second Advance Estimates of the Department of Agriculture & Farmers' Welfare for 2025-26, onion production is estimated at 307.37 lakh metric tonnes (LMT), which is comparable to the production of 307.67 LMT in 2024-25.
Going by the production estimates, the overall availability of onions is not a concern at this stage, though prices may be expected to inch up in line with the normal price seasonality, the Ministry said.
"Current stock levels in Maharashtra, Madhya Pradesh and Gujarat are adequate. At present, there are no indications of any shortage of stored onions," the Ministry added.
Daily mandi arrivals at the all-India level remain robust at over 50,000 metric tonnes (MT), while arrivals in Maharashtra are over 30,000 MT, with average modal prices of about Rs 18 per kg. Better-quality stocks continue to remain in storage and are expected to be released during the lean period. The all-India average retail price is Rs 31 per kg.
As per the Ministry, the delay in monsoon arrival and lower-than-normal rainfall in some regions have led to speculative buying by a section of traders, though there is no significant demand at the prevailing price levels in major consuming centres. Despite the sentiment in consumer markets, production centres such as Nashik and parts of Madhya Pradesh are witnessing a tendency for speculative trading activity, largely on expectations of a future market recovery rather than on strong underlying demand.
Onion exports are normal, with about 1.50 LMT exported during June 2026. However, traders expect that the pace of onion exports may slow down for a short duration, primarily because fresh crops from Pakistan and China are available at competitive rates in key export destinations such as the Gulf countries, Sri Lanka and the Far East.
While the Nashik region of Maharashtra has reported about a 15-day delay in Kharif sowing, the sowing progress in the Chitradurga and Challakere belt of Karnataka is estimated to be around 60 per cent of normal.
— ANI
Reader Comments
As a consumer, I am happy for the farmers, but worried about retail prices. Current ₹31/kg is already high compared to last year. Will this increase lead to even higher prices for common people? The government should balance both farmer welfare and consumer protection.
Finally some sensible policy! NAFED and NCCF doing good work. But the speculative trading in Nashik is concerning. Government should crack down on hoarders who create artificial shortages. Remember how onion prices touched ₹100/kg in 2020? Hope we don't repeat that nightmare.
Good initiative but why only 13%? Inflation is much higher. Farmers deserve fair compensation for their hard work. Also, the delay in monsoon is worrying - if Kharif crop is delayed, prices might spike anyway. Need proactive measures, not reactive ones.
Let's appreciate the transparency in this announcement - production estimates, arrival data, export figures all shared. Good to see data-driven policymaking. But the 15-day delay in Kharif sowing is a red flag. Hope buffer stocks are sufficient for lean periods.
This is classic election-year economics! Why not implement MSP properly instead of ad-hoc price hikes? Farmers in Maharashtra are still recovering from last year's floods. ₹2,125/quintal is better but still not enough when input costs have doubled.
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.