Government Raises Onion Procurement Price to Rs 2,125 per Quintal

PTI, July 4, 2026, New Delhi : The government has raised the procurement price of onions for buffer stock purposes by 13 per cent, from Rs 1,875 per quintal to Rs 2,125 per quintal, in a bid to boost procurement and ensure better returns for farmers.

The revised rate comes into effect from July 4, 2026, an official statement said.

This marks the fifth upward revision in the procurement price this season, as the government’s onion buying for the 2026 buffer stock under the Price Stabilisation Fund has got off to a slow start.

Only around 2,000 tonnes have been procured since June 1 despite repeated hikes in the purchase price. The procurement price has climbed in quick succession since the season opened—from Rs 12.70/kg to Rs 15.80/kg on May 22, then to Rs 16.50/kg on June 13, Rs 17.30/kg on June 20, and subsequently to Rs 18.75/kg, before the latest increase to Rs 21.25/kg (Rs 2,125/quintal).

According to the Second Advance Estimates of the Department of Agriculture & Farmers’ Welfare for 2025–26, onion production is pegged at 307.37 lakh tonnes, broadly on par with 307.67 lakh tonnes in 2024–25.

The consumer affairs ministry said overall availability is not a concern at this stage, though prices may inch up in line with normal seasonal trends.

Stock levels in Maharashtra, Madhya Pradesh and Gujarat remain adequate, with no indication of shortages in stored onions.

Daily mandi arrivals at the all-India level stayed robust at over 50,000 tonnes, with Maharashtra alone accounting for more than 30,000 tonnes at an average modal price of about Rs 18/kg.

The all-India average retail price stands at Rs 31/kg. Better-quality stocks continue to be held back in storage and are expected to be released during the lean period.

A delayed monsoon and below-normal rainfall in some regions have triggered speculative buying by a section of traders, even though actual demand in major consuming centres remains muted at current price levels.

Production hubs such as Nashik and parts of Madhya Pradesh are seeing speculative trading activity, driven more by expectations of a price recovery than by real demand.

Onion exports remained normal in June, with about 1.50 lakh tonnes shipped out during the month. However, traders expect export momentum to ease in the near term, as cheaper fresh crops from Pakistan and China are undercutting Indian onions in key markets such as the Gulf, Sri Lanka and the Far East.

Meanwhile, Kharif sowing has been delayed by about 15 days in Maharashtra’s Nashik region, while progress in Karnataka’s Chitradurga and Challakere belt is running at around 60 per cent of normal.