To curb spurt in retail prices of onion following the recent removal of export duty, the government has stated bulk sale of staple vegetable in the wholesale markets like Azadpur mandi in Delhi from its buffer stock.
Trade sources said that the government agencies such as farmers’ cooperative Nafed and NCCF have sold onion through auctions in country’s biggest mandi for vegetable in Delhi in the price range of Rs 38/kg-Rs 42/kg in the last two days from their buffer of 0.47 million tonne (MT).
Recently the government agencies had started to sell onion at a subsidised rate of Rs 35/kg retail points across various parts of the country.
“With robust kharif sowing, the aim is to keep prices under control by offloading stocks in the market till new harvest arrives next month”, Nidhi Khare, secretary, department of consumer affairs, told FE.
Khare said a spurt in price following lifting of restrictions on onion exports recently has started to moderate. The modal retail price of onion on Saturday was Rs 50/kg according to the consumer affairs department while retail prices in key metro cities ranged from Rs 50/kg to Rs 65/kg.
“Enhanced retail and bulk sale strategies along with the available buffer stock of 0.47 million tonne (MT) of onion and increased kharif sowing area as compared to the previous year, onion prices will remain under control in coming months,” according to an official statement.
The kharif harvested onions have started to arrive in the market in Karnataka while new crops from Maharashtra, Madhya Pradesh and Rajasthan are likely to enter the market by the middle of next month. There is an expectation of a bumper harvest given the higher sowing
A joint team consisting of officials from the agriculture and department of consumer affairs will be visiting key growing regions to assess the output of kharif onion for 2024-2025 crop year (July-June)
So far, 0.36 million hectare (MH) of kharif onion has been sown against 0.22 MH reported last year during the same period.
The government recently abolished minimum export prices (MEP) for onion and also reduced the export duty on the staple vegetable to 20% from 40% on robust kharif prospects.
According to the agriculture ministry, output of onion in the 2023-24 crop year was estimated at 24.24 MT, a decrease of 20% compared to previous year.
Retail inflation in onion was 54.04% in August on year because of lower production.
The government agencies such as farmers’ cooperative Nafed and NCCF have procured 0.47 MT of onion for the price stabilisation fund buffer from the rabi 2024 harvest this year from farmers, against 0.3 MT purchased in the previous year.
In addition, 3.8 MT of onions are still stored by private traders and farmers.
The two agencies have purchased onion from farmers at an average price of Rs 28.33/kg this fiscal, compared to procurement of staple vegetables at an average price of Rs 17.24/kg in FY24.