In Maharashtra, India's leading onion-producing state, the federal government has increased its procurement price by 74% compared to the previous year. This move comes as the state approaches assembly polls. An official noted, "While last year, the average rate at which onions were procured was Rs 16.93 per kg, this year, procurement is happening at around Rs 29.5 per kg via direct benefit transfer (DBT)." The government's expenditure on onion procurement from Maharashtra is expected to reach Rs 15 bln this financial year, up from Rs 12 bln last year.
Following a significant price surge in August last year, which impacted food costs and inflation, the government banned onion exports to moderate domestic prices. Despite criticisms for limiting farmers' access to international markets, this measure was aimed at stabilizing retail prices. The government plans to procure 500,000 tons of onions to maintain buffer stocks for market intervention. The National Cooperative Consumers' Federation of India (NCCF) and National Agricultural Cooperative Marketing Federation of India Ltd (Nafed) have been set a target of 250,000 tons each for onion procurement.
With a 38% increase in retail onion inflation year-on-year in May, efforts are underway to expand onion cultivation beyond Maharashtra and Karnataka. The official expects "10,000 farmers to benefit from rabi procurement of onion in 2024 against last year's 6,100."
[ Rs 100 = €1.10 ]
Source: business-standard.com