Government Increases Onion Procurement Price by 13% to ₹2,125 per Quintal

On July 4, 2026, the government announced a 13% increase in the procurement price of onions for the Price Stabilisation Buffer, raising it from ₹1,875 to ₹2,125 per quintal as per the press release of PIB news report.  

This adjustment aims to provide better returns for onion farmers while supporting buffer procurement through NAFED and NCCF. 

Onion Production and Availability 

According to the Second Advance Estimates by the Department of Agriculture & Farmers' Welfare for 2025-26, onion production is estimated at 307.37 lakh metric tonnes (LMT), closely matching the 307.67 LMT produced in 2024-25.  

Current stock levels in Maharashtra, Madhya Pradesh, and Gujarat are adequate, with no signs of a shortage in stored onions. 

Market Dynamics and Pricing 

Daily mandi arrivals at the all-India level exceed 50,000 metric tonnes (MT), while Maharashtra sees over 30,000 MT, with average modal prices around ₹18 per kg.  

The all-India average retail price stands at ₹31 per kg. Despite a delay in monsoon arrival and lower-than-normal rainfall in some regions, speculative buying by traders is noted, although demand remains stable at prevailing price levels. 

Read More: MEIL to Invest Up to ₹40,000 Crore in 3 Years, Targets ₹2 Lakh Crore Topline in 5 Years! 

Onion Exports and Regional Sowing Updates 

Onion exports are ongoing, with 1.50 LMT exported in June 2026. However, traders anticipate a temporary slowdown due to competitive pricing from fresh crops in Pakistan and China. In Maharashtra's Nashik region, Kharif sowing is delayed by about 15 days, while Karnataka's Chitradurga and Challakere belt reports sowing progress at 60% of normal levels. 

Conclusion 

The government's decision to raise the onion procurement price to ₹2,125 per quintal reflects a 13% increase, aimed at ensuring better returns for farmers. With onion production estimated at 307.37 LMT and daily arrivals robust, the market remains stable despite regional sowing delays and speculative trading activities. 

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