Govt to procure 2 lakh tn of onions to create total 5-lakh-tn buffer stock this year

To meet any exigencies stemming from any short supply of onions, the government on Sunday (August 20) announced that it will procure an additional 2 lakh tonnes of onions to build up its total buffer stock to 5 lakh tonnes this year. This additional stock will be used for retail intervention to ensure continuous supply of this staple food item for consumers.

This development comes a day after the government slapped a 40 per cent duty on onion exports to boost local supplies and keep a check on its prices.

Improve local availability, check price rise

For the current 2023-24 fiscal, the target for onion buffer was kept at 3 lakh tonnes, which has already been procured. Currently, the same buffer stock is being disposed of in the targeted markets in select states to improve the local availability and check price rise.

According to the official data, all-India average retail price of onion was ruling 19 per cent higher at ₹29.73 per kg on Sunday, compared to ₹25 per kg in the year-ago period. In Delhi, retail price of onion has increased to ₹37 per kg from ₹28 per kg in the said period.

"In an unprecedented move, the government raised the quantum of onion buffer to 5 lakh tonnes this year, after achieving the initial procurement target of 3 lakh tonne," consumer affairs ministry said in a statement.

The National Cooperative Consumers' Federation of India (NCCF) and the National Agricultural Cooperative Marketing Federation of India (NAFED) have been directed to procure one lakh tonne each to achieve the additional procurement target alongside calibrated disposal of the procured stocks in major consumption centres, it said.

The buffer stock is maintained under the Price Stabilisation Fund (PSF) to meet any exigencies, if rates go up significantly during the lean supply season. The government had maintained a buffer onion of 2.51 lakh tonne during the 2022-23 fiscal.

Buffer stock being used

On disposal of onion from the buffer stock, the ministry said it has already commenced in target major markets in states and Union territories, where retail prices are above the all-India average and/or are significantly higher than the previous month.

"As of date, about 1,400 tonnes of onions from the buffer have been dispatched to the targeted markets and are being continuously released to augment the availability," it said.

Apart from releasing in major markets, onions from the buffer are also being made available to retail consumers at a subsidised rate of ₹25 per kg through retail outlets and mobile vans of NCCF from August 21 in key markets.

"Retail sale of onion will be suitably enhanced in coming days by involving other agencies and e-commerce platforms," said the ministry.

The multi-pronged measures taken by the government to procure onions for the buffer stocks, targeted release of stocks and imposition of export duty will benefit the farmers and consumers by assuring remunerative prices to the onion farmers, while ensuring continuous availability to the consumers at affordable prices, it added.

(With inputs from agencies)