The Centre has decided to buy 5 lakh tonnes (lt) of onion directly from farmers from April 1 so that it ensures farmers are not stressed due to the export ban. The Government will simultaneously sell those quantities which need immediate disposal while keeping the remaining for the buffer.

Announcing the decision, Consumer Affairs Secretary Rohit Singh and Special Secretary in the Consumer Affairs Ministry Nidhi Khare said earlier the purchases were announced in tranches. In contrast, this year, it is at one go and if needed more onions will be purchased so that farmers are not distressed.

The officials said farmers at Lasalgaon in Maharashtra, the largest trading hub for onion in the country, are getting  ₹14/kg now against about  ₹8/kg a year ago. Still, the government decided to intervene as farmers should not be feeling that they were selling at a loss. “The Government never purchased onion at below cost and last Rabi season onion was bought at an average ₹17/kg,” Singh said.

Buffer stocks down to 25,000 tonnes

The government had procured 7 lt of onion in 2023-24 (April-March) season including 5 lt from Rabi crop which started in June. This year, the purchase period has also been advanced, Singh said. Out of the 7 lt onion purchased, only about 25,000 tonnes are in the buffer stock while remaining quantity has been sold, he said.

Asked about the selling price if the government will keep to the earlier policy of ₹25/kg retail sales, the officials said t it will be sold in wholesale market at the prevailing rates and there is no decision yet on retail sales.

The official also said they are very concerned about the onion prices and have started planning for the next Diwali season considering a fall in Rabi onion production has been estimated by the Agriculture Ministry. While on the one hand, the shelf life of onions would be increased by using the irradiation technology, the government will also try to ensure early sowing of kharif crop so that there is ample availability during festival period.

The Rabi onion production is set to dip to 193 lt in 2023-24 as against 236 lt year-ago, a fall of 18 per cent.