The Union government will deploy its entire onion buffer stock through retail sales this year after procuring only about 120,000 tonnes — well short of its 200,000-tonne target — marking a departure from the past two years when it intervened in both wholesale and retail markets to contain prices, officials aware of the matter said.
Meanwhile, the year-on-year consumer price inflation in onion has risen to 22.5% in July, up from the 4.7% it stood at in June. Last year, the Centre sold buffer-stock onions at ₹ 24 per kg through NAFED and NCCF retail outlets across major cities, including Delhi-NCR, Mumbai, Ahmedabad, Chennai, Kolkata and Guwahati. The shortfall follows an unusually difficult procurement season, during which the Centre was forced to raise the Minimum Assured Procurement Price (MAPP) six times as firm market prices discouraged farmers from selling to government agencies. Officials also cited operational challenges involving procurement and storage agencies that slowed purchases. The onion buffer, maintained under the Price Stabilisation Fund, is used to cool prices by releasing subsidised stocks during periods of tight supply. “Major challenge here is storage and then infusing in market.
Officials said this year’s sales will similarly be calibrated to price movements in major consumption centres. Selling in retail has direct effect on consumer prices and hence effective,” said Madan Sabnavis, chief economist at Bank of Baroda.
