The government is selling onions from its buffer stock at Rs 35 a kg, but consumers in several parts of the country are still paying around Rs 60-70 a kg, and prices could be even higher in some markets.
The all-India average retail price of onion stood at Rs 53.84 per kg on September 16, up nearly 94% from Rs 27.71 a year ago, according to the Department of Consumer Affairs. The average wholesale price was Rs 45.65 per kg.
The sharp gap between the government’s Rs 35 onion and the price many households are paying highlights the challenge of getting buffer stocks from producing centres to consumers at scale.
The government began releasing onions from its Price Stabilisation Fund buffer on August 24. It has been using NCCF, NAFED, Kendriya Bhandar and mobile vans to sell onions at Rs 35 a kg, while railway rakes and trucks are being used to move supplies from producing regions to major consumption centres.
The government says the intervention is already having an impact in some markets. It has expanded the buffer-stock operation to 19 cities, using the Kanda Express railway service and more than 30 trucks to move onions to consumption centres.
But .
The government itself has identified the rabi-to-kharif transition as a period when onion prices typically rise. Stored rabi onions gradually run down before the next crop arrives, creating a temporary supply squeeze. It may be noted that the government’s own guidelines say buffer onions are released during the lean season, typically from September to December, to help keep prices affordable.
This year, the transition has been complicated by delayed kharif sowing in some major producing regions. In July, the government said kharif sowing in the Nashik region was around 15 days behind schedule, while sowing in the Chitradurga-Challakere belt of Karnataka was estimated at around 60% of normal.
Weather has added to the uncertainty. The government had earlier flagged the and said speculative buying by some traders was also contributing to market sentiment around onion prices.
The government, however, maintains that India does not have an overall onion shortage. Its 2025-26 production estimate stands at 307.37 lakh tonnes, broadly unchanged from 307.67 lakh tonnes the previous year. It had also said stocks in Maharashtra, Madhya Pradesh and Gujarat were adequate when it assessed the situation in July.
It had set a target of procuring 2 lakh tonnes of rabi onions for the 2026-27 buffer and had procured around 1.21 lakh tonnes. The buffer is meant to provide supplies during lean months and prevent sharp seasonal price spikes.
The government has also raised the procurement price paid for onions entering the buffer from Rs 1,875 to Rs 2,125 per quintal, or Rs 21.25 a kg, to provide farmers better returns while strengthening buffer procurement.
There is therefore a delicate balancing act underway. Release too little and consumers continue to feel the pinch; release too much and the government has less buffer to rely on during the remaining lean period.
For now, the government’s intervention is visible, but so is the price gap. A household able to access a government outlet can buy onions at Rs 35 a kg. A household shopping in the open market may pay nearly twice that.
The next big test will be fresh kharif arrivals. If supplies begin reaching mandis in larger quantities, prices should get some relief. Until then, shrinking rabi stocks, delayed arrivals and uneven distribution of buffer onions could keep the humble kitchen staple unusually expensive.