Centre remains committed to taming onion prices, to continue to procure bulb

The government said on Monday that it would continue to procure onions from farmers in a bid to ensure fair prices for the consumer. The procurement would continue across the country’s wholesale markets until the rates come down to desired levels, said Consumer Affairs Secretary Rohit Kumar Singh. 

The move would likely benefit the farmer and the consumer alike, he said. 

The development comes at a time when the government has already taken its procured stock buffer of onions to five lakh metric tonnes so far this year, on top of the initial target of three lakh metric tonnes, and has approvals of an additional two lakh metric tonnes in place, said the official.

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The department has already released the buffer of three lakh metric tonnes into the markets to put a lid on the prices. Currently, the buffer stands at 50,000-1,00,000 metric tonnes. 

The Centre has already spent Rs 600 crore on the procurement of onions from growers. 

It remains committed to ensuring the sufficient availability and affordability of onions in the domestic markets. 

Last week, the Centre extended a ban on exports of the kitchen staple till March 31 next year, after the retail sales price of the bulb crossed the Rs 80 per kilogram mark in the national capital while the wholesale rate remained as high as around Rs 60 per kilogram. 

Earlier, it had imposed $800 per metric tonne as the minimum export price to discourage producers from exporting the bulb, in a move aimed at countering surging domestic rates.

Rapid exports hurt the domestic availability of onions in India, the world’s second largest producer and consumer of the crop. 

Meanwhile, the government expects onion prices to fall below Rs 40 per kilogram by January from the current average price of about Rs 57 per kilogram.

Onion consumer inflation hit a four-year peak of 42.1 per cent in October, a fourth straight month of the reading remaining in double digits. 

As of August 4, an estimated 9.75 lakh tonnes of onions have been exported from the country so far this financial year. 

With inputs from agencies