Onion prices surge 59 pc, govt moves bulk supplies via ‘Kanda Express’ to cool market

The Centre has started moving bulk onion stocks through dedicated railway rakes – the “Kanda Express” – from Nashik in Maharashtra to major consuming centres, as part of efforts to augment supplies and check the seasonal rise in prices, Consumer Affairs Secretary Nidhi Khare said on Monday (August 24).

Stocks currently being loaded onto these rakes are expected to reach the identified centres by Wednesday (August 26), she said.

Price rises sharply

Data maintained by the ministry shows the all-India average retail price of onion rose 59 per cent year-on-year to Rs 43.53/kg on August 24, from Rs 27.37/kg a year ago. The average wholesale price was up 68 per cent at Rs 35.58/kg, against Rs 21.23/kg in the year-ago period.

Among major cities, retail onion prices on Monday stood at Rs 60/kg in Chennai (Rs 33 a year ago), Rs 55/kg in Delhi (Rs 35), and Rs 53/kg in Kolkata.

"Initially, the onions will be supplied to five major consumption centres, namely Chennai, Madurai, Delhi, Ernakulam, and Guwahati, with additional destinations to be included subsequently based on emerging market requirements," Khare told PTI.

Also Read: Red vs White | Maharashtra farmers fume over 'pro-Gujarat' onion export ban

The buffer stock of onions maintained at Nasik is being moved in bulk through rail rakes and the supplies will be offloaded in both wholesale and retail markets in these select consuming centres. Onion will be sold at Rs 35 per kg in the retail market through agencies NCCF and NAFED, she added.

Khare said the government is keeping a close watch on prices to take further steps.

“Mandi prices in Nasik are ruling higher than Delhi, which should not be the case. It means cartelisation and speculation are at work,” she noted.

Buffer stock – Centre’s strategic reserve

The onion buffer stock is the Centre's strategic reserve, built up primarily to cushion the market against price spikes when supplies tighten.

It is procured mainly through agencies such as NAFED and the NCCF under the Price Stabilisation Fund, and released into the market in a calibrated manner during periods of seasonal shortage or sharp price escalation.

Khare said the government has a buffer stock of 1.21 lakh tonnes of onion for the current year, sufficient to meet the demand.

‘Onion availability comfortable’

Khare said onion availability remains comfortable to meet domestic demand over the coming months, supported by estimated 2025-26 production of 307.37 lakh tonnes, 'broadly on par with 307.67 lakh tonnes in the previous year. Buffer stocks are also available for calibrated intervention, she added.

Khare said the government continues to monitor prices, market arrivals, and availability across states, and will undertake further interventions as required.

Also Read: Maharashtra: Unseasonal rains dampen mood in onion farming belt

She noted that stable production, buffer stock availability, and proactive market interventions are together expected to moderate seasonal price pressures, even as the price-stabilisation approach seeks to balance consumer and farmer interests.

Seasonal volatility a recurring trend

Onion prices typically see a seasonal uptick from August-September, on account of festive demand, weather-related disruptions, supply-chain movements, and shifting demand patterns.

To counter this, the ministry undertakes calibrated release of buffer stocks “through bulk mandi releases and targeted retail sales in consumption centres”, a strategy it said has been consistently followed in recent years.

Also Read: Remove 20 per cent export duty on onions: Ajit Pawar urges Centre

The timing, quantity, and destination of releases are decided based on continuous monitoring of prices and market conditions across States.

Kanda Express – from 14 to 86 rakes

The Kanda Express initiative “aimed at enhancing logistical efficiency for large-scale onion movement” was launched in 2024-25, and has since been scaled up considerably.

Also Read: India exports over 45,000 tons of onion after Centre lifts ban

In 2024-25, 14 railway rakes carrying nearly 12,000 tonnes of onion buffer stock were dispatched to five cities.

In 2025-26, this has expanded to 86 rakes carrying about 88,000 tonnes of onions to 16 major cities across the country.

(With agency inputs)