Onion supply comfortable for the coming months, says consumer affairs secretary

Onion availability is comfortable to meet domestic demand in the coming months, even as the Centre has begun a calibrated release of buffer stocks ahead of the festive and wedding seasons, consumer affairs secretary Nidhi Khare said on Wednesday.

The government has started moving buffer-stock onions through railway and road transport, with the first Kanda Express leaving Nashik for New Delhi. More than 15 trucks will also leave for more than 10 destinations, Khare said.

The move comes ahead of festivals, including Ganesh Chaturthi, Durga Puja, Dussehra and Diwali, as well as the wedding season, when onion prices typically see a seasonal uptick because of higher demand and supply-chain factors.

“The calibrated and targeted mechanism to keep onion prices in check has yielded immediate results, with retail onion prices declining by 13% in two days,” she said. “As of 26 August, the all-India average retail price of onion stood at ₹37.87 per kg, down 13% from ₹43.53 per kg on 24 August.”

Khare said that comfortable production, availability of buffer stocks and proactive market interventions are expected to ensure adequate supplies and moderate seasonal price pressures in the coming months.

Government expands buffer sales

Onion production is estimated at 307.37 lakh tonnes (LMT) in 2025-26, broadly in line with 307.67 LMT in the previous year. The government has set a procurement target of 2 LMT of rabi onion for the price stabilization fund (PSF) buffer for 2026-27, of which around 1.21 LMT has been procured so far, she said.

The Centre is selling onions at ₹35 per kg through mobile vans and retail outlets of NCCF and NAFED, besides Safal and Kendriya Bhandar outlets in Delhi. The sales are being carried out through 9 NCCF outlets and 40 mobile vans, 13 NAFED outlets, and about 100 Kendriya Bhandar outlets.

The railway-based movement of buffer onions has expanded significantly in recent years. During 2024-25, 14 railway rakes transported nearly 12,000 tonnes of onions to five cities. This increased to 86 rakes carrying around 88,000 tonnes to 16 cities in 2025-26.

This year, Kanda Express consignments from Nashik are being moved to Delhi-NCR, while supplies are simultaneously being transported to Chennai, Kolkata, Ernakulam, Guwahati, Varanasi, Lucknow, Patna, Chandigarh, Jammu and Amritsar, Khare said, adding that the quantity, coverage and disposal channels will be widened depending on prevailing market conditions and price trends.

The government has also engaged the Central Warehousing Corporation (CWC) for the first time as the storage agency for the PriSF onion buffer during 2026-27, with the aim of improving transparency and operational efficiency.

Meanwhile, India exported about 3.82 LMT of onions during April-June, with Malaysia, Sri Lanka, the UAE and Nepal among the major destinations, according to consumer affairs ministry data.

The department of consumer affairs monitors daily prices of 41 essential commodities, including onions, across 579 centres. These price trends, along with arrivals and demand conditions, are used to determine the scale and destinations of buffer-stock releases.

The rise in onion prices is also feeding into household food budgets. According to Crisil Intelligence's latest Roti Rice Rate report, the cost of a home-cooked vegetarian thali rose 4% year-on-year in July, while that of a non-vegetarian thali increased 9%. Onion prices rose 8% year-on-year in July and 10% from the previous month, adding to the cost of home-cooked meals.

Under the revised Consumer Price Index (CPI) series (Base: 2024=100), onions carry a weight of 0.7006% in the overall CPI basket.

The planned intervention also assumes significance as retail inflation has moved above the Reserve Bank of India's 4% target. CPI-based retail inflation rose to 4.45% in July from 4.38% in June, remaining above the central bank's 4% medium-term target for the second consecutive month. The rise was driven largely by food prices, with food inflation accelerating to 5.52% in July from 5.32% in June.