Beginning next month, the Indian government will buy 15,000 tons of onions from farmers in Lasalgaon in Maharashtra, to create a buffer stock, which will be utilised for market intervention in the event of price increases if supplies later become tighter.
Last year, the retail price of onions skyrocketed to about Rs 80-90 per kg. The sharp rise in prices forced the government to boost supply in the market by purchasing onions from the domestic as well as overseas market. The government procured 8,000 tonnes of onions last year, but only after the retail prices had shot up. This year, the Consumer Affairs Ministry has been asked to prepare timely import plans for pulses and onions. It has also been asked to intervene in the market on time, so that consumers are not affected by price rises.
Onion production is estimated to increase to 20.33 million tonnes in 2015-16 from 18.92 million tonnes in the previous year, said Minister of State for Agriculture Mohanbhai Kundariya. In view of the fall in onion prices, the government removed the minimum export price on onions on December 24, 2015, he added. At present, retail prices of onions are at Rs 20 per kg in the national capital. Normally, prices flare up during the August-September period.
