The Indian government on Friday announced the release of onion in the open market from its 3-lakh tonne buffer stock, targeting key markets in States or regions where retail prices are ruling above the all-India average.

The decision comes on the heels of onion prices rising by 60 per cent since the beginning of this month. However, there will be no subsidised sales of onion in the market, unlike tomato.

Also read: Despite record high arrivals, onion prices up 28% in a month

“The Department of Consumer Affairs has decided to commence the release of stocks from the onion buffer of three lakh tonnes (lt) created this year,” the Consumer Affairs and Food Ministry said in a statement. The Government will release the onion also where the rates of increase in prices (over the previous month and a year ago) are above the threshold level, the statement said.

Meet on modalities

Official data show that all India average retail price of onion has inched up to ₹27.51/kg this month from ₹26.51 in July and ₹25.55 in August 2022. However, Consumer Affairs Ministry officials said there has been an increase of ₹8-10/kg at some places like Shamli, Rampur, Chandauli and Santkabir Nagar in Uttar Pradesh and Bhind and Satna in Madhya Pradesh over the past month.

“Though there could be local factors for the increase in UP and MP, since mandi prices, too, have started rising, the sale from the buffer stocks will help contain the rising trend as the festival season is about to start,” an official said.

Also read: Onion sowing set to gain pace as monsoon gathers pace in Karnataka, Maharashtra 

Consumer Affairs Secretary Rohit Kumar Singh on Thursday held a meeting with the Managing Directors of co-operatives NAFED and NCCF and discussed the modalities for the disposal to finalise the plan, the Ministry said.

Ensure ample availability

Asked about the plan, Singh told businessline that, unlike tomato, the situation in onion has not yet warranted a differential selling rate. The Government would sell at market rates and ensure higher availability so that prices are under control, Singh said d.

Disposal through e-auction and retail sales on e-commerce platforms are also being explored, an official said. The quantity and pace of disposal will also be calibrated with the prices and availability situations with the objective of making onion available to consumers at affordable prices, officials said.

Besides, the Centre has also decided to offer States at discounted rates for further distribution through retail outlets of their consumer cooperatives and corporations, the ministry said.

Cutting storage losses

In the current year, as much as 3 lt of onion – both NAFED and NCCF bought 1.50 lt each during June-July from Maharashtra and Madhya Pradesh — has been procured for buffer stocks and the government may enhance the purchase if required, after seeing the response to the sales, officials said.

This year, irradiation of onion had also been taken up on a pilot basis in collaboration with Bhabha Atomic Research Centre (BARC) with the objective of minimising storage loss. About 1,000 tonnes had been irradiated and stored in controlled atmosphere storage.

The Centre has been maintaining an onion buffer under the Price Stabilisation Fund to check the volatility in prices. Onion purchase for the buffer stock has tripled in the past four years — to 3 lt in 2023-24 from 1 lt in 2020-21.

Prices of the bulb have increased by 28 per cent over the past month despite record arrivals month-on-month and year-on-year.

According to official data, the modal price of onion at Asia’s largest market for the commodity in Lasalgaon (Maharashtra) was ₹2,200 a quintal on August 11 against ₹1,370 on August 1. On the other hand, arrivals between July 1 and August 7 at agricultural produce marketing committee (APMC) yards across the country are a record 22.33 lt, compared with 18.25 lt during the year-ago period.

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