Govt Boosts Onion Procurement Price by 13% to ₹2,125 per Quintal as Buffer Stock is Strengthened

Govt Boosts Onion Procurement Price by 13% to ₹2,125 per Quintal as Buffer Stock is Strengthened​

The Government has significantly enhanced support for onion farmers by increasing the procurement price for onions utilized in the Price Stabilisation Buffer. Effective from July 4, 2026, the purchase rate through NAFED and NCCF has been raised by 13%.

The revised procurement price moves from ₹1,875 per quintal to the new rate of ₹2,125 per quintal. This increase is specifically intended to ensure better returns for onion farmers while strengthening efforts related to buffer stock creation. Procurement operations are currently underway through these designated agencies.

Government Elevates Farmer Welfare and Buffer Procurement​

The price enhancement is part of a sustained effort by the government to stabilize markets and support primary producers. The increased rate signifies greater commitment toward farm income security amidst fluctuating market conditions. This action aims to ensure that farmers receive a fair return for their harvest during this crucial period.

Market Supply Dynamics and Current Stock Levels​

Current supply availability appears stable, although seasonal price increases remain possible. The Department of Agriculture & Farmers' Welfare estimates onion production at 307.37 lakh metric tonnes (LMT) in the current year. This estimate is comparable to the 307.67 LMT recorded during the 2024-25 season.

Stock levels across major producing regions like Maharashtra, Madhya Pradesh, and Gujarat are currently adequate. There are no indications of any shortage concerning stored onions at present. Daily mandi arrivals across all India remain robust, registering over 50,000 metric tonnes (MT). Maharashtra alone recorded more than 30,000 MT in daily arrivals.

Retail Price Trends and Speculative Trading Activity​

The current All-India average retail price for onions stands at ₹31 per kg. The average modal price observed during mandi transactions is approximately ₹18 per kg. Better quality stocks continue to be maintained in storage facilities, with a plan in place to release these into the market during periods of scarcity.

In production hubs such as Nashik and parts of Madhya Pradesh, speculative trading activity has been noted. This trend is fueled by expectations of future market recovery rather than strong underlying immediate demand. Speculative buying has also occurred due to delayed monsoon arrivals and lower-than-normal rainfall in specific regions.

Farming Progress and Global Export Outlook​

The sowing progress across various states shows mixed results regarding timely farming cycles. The Nashik region of Maharashtra has reported approximately a 15-day delay in Kharif sowing. In contrast, the Chitradurga and Challakere belt of Karnataka is estimated to be operating at around 60 per cent of normal sowing.

Onion exports are currently operating normally, with about 1.50 LMT exported during June 2026. However, traders anticipate a short duration slowdown in the pace of onion exports. This expectation is attributed primarily to competitive fresh crop availability from Pakistan and China crops entering key export destinations like Sri Lanka, the Far East, and Gulf countries.