The government will be procuring 15,000 tonnes of onion from farmers in order to create a buffer stock which will be utilized for market intervention in the event of price rise during a lean season. The procurement of onions would begin from next month from Lasalgaon in state of Maharashtra. The government’s nodal agencies NAFED and SFAC will do the procurement of onion. The Price Stabilisation Fund would be utilized for this purpose.
The retail price of onion last year had skyrocketed to about Rs 80-90 per kg. The sharp rise in prices had forced the government to boost supply in the market by purchasing onions from domestic as well as overseas market. The government procured 8,000 tonnes of onion but it was done after the retail prices had gone through the roof.
The production of onion is estimated to be increase to 20.33 million tonnes in 2015-16 from 18.92 million tonnes in the previous year. The retail price of onion is currently ruling at Rs 20 per kg in the national capital. Normally, prices flare up during August-September period.