Onion Procurement Price Increased to ₹1,650 Per Quintal: Big Relief for Farmers, What It Means for Consumers and Inflation

June 13, 2026 Kiran

Government Raises Onion Procurement Price to Support Farmers

In a significant move aimed at improving farmer income and stabilizing the agricultural market, the Central Government has increased the Minimum Assured Procurement Price (MAPP) of onions to ₹1,650 per quintal (₹16.50 per kg). The revised procurement rate will come into effect from June 13 and is expected to benefit thousands of onion growers, especially in Maharashtra, India’s largest onion-producing state.

The decision comes at a time when onion farmers have been demanding better prices due to rising cultivation costs, including labor charges, fertilizers, irrigation expenses, transportation, and storage costs. The government hopes that the increased procurement rate will provide much-needed relief to farmers while ensuring adequate buffer stock for future market interventions.

What Is the New Onion Procurement Price?

The government has revised the onion procurement rate from ₹1,580 per quintal to ₹1,650 per quintal under its buffer stock procurement program. The procurement is carried out through agencies such as NAFED and NCCF to maintain buffer stocks that can be released into the market whenever onion prices become excessively high.

According to the Ministry of Consumer Affairs, the revised pricing has been determined based on prevailing mandi prices and the quality standards required for storage-grade onions. The government has also updated its pricing methodology to make procurement more responsive to changing market conditions.

Why Did the Government Increase Onion Procurement Rates?

Several factors contributed to the decision:

1. Rising Cost of Cultivation

Farmers have been facing increasing production costs due to higher prices of seeds, fertilizers, pesticides, labor, and fuel. Many growers argued that previous procurement rates were insufficient to cover these expenses.

2. Protecting Farmer Income

Onion prices often experience sharp fluctuations. During periods of oversupply, market prices can crash, causing significant losses for farmers. The revised procurement rate is intended to offer a safety net and ensure better returns.

3. Strengthening Buffer Stocks

The government maintains onion reserves under the Price Stabilisation Fund (PSF). These stocks help control retail prices during shortages and protect consumers from sudden inflation spikes.

Major Benefits for Maharashtra Farmers

Maharashtra accounts for a substantial share of India’s onion production, with districts such as Nashik being major onion-growing hubs. Farmers in the state have repeatedly demanded better procurement prices and government intervention due to volatile market conditions.

The revised procurement price is expected to:

Improve farmer profitability.
Reduce distress sales during periods of low market demand.
Provide a more stable income source.
Encourage farmers to continue onion cultivation.
Strengthen confidence in government procurement mechanisms.

However, farmer organizations have stated that the increase may still not fully compensate for rising production costs. Some groups have demanded procurement prices as high as ₹3,000 per quintal to ensure sustainable profits.

Impact on Onion Prices and Inflation

One of the biggest concerns surrounding any onion-related policy is its effect on inflation. Onions are a staple ingredient in Indian households, and sharp price increases often affect household budgets.

Experts believe that the procurement price hike is unlikely to cause an immediate surge in retail onion prices because the increase is relatively moderate. Instead, the move is designed to balance farmer welfare with consumer interests.

The government’s buffer stock strategy allows authorities to release onions into the market whenever prices rise excessively. This mechanism helps prevent sudden inflation while ensuring farmers receive fair compensation.

Government’s Onion Production Outlook

According to official estimates, India’s onion production for the 2025-26 season is expected to remain largely stable at over 307 lakh tonnes. Adequate production levels combined with improved procurement policies could help maintain supply stability and reduce market volatility.

The government has set a procurement target of approximately 2 lakh tonnes for the current season, which will contribute to strengthening the country’s onion buffer stock reserves.

Conclusion

The government’s decision to increase the onion procurement price to ₹1,650 per quintal marks an important step toward supporting farmers and stabilizing agricultural markets. While the increase offers relief to onion growers, especially in Maharashtra, many farmer groups continue to seek higher support prices to offset rising cultivation costs.

For consumers, the move is expected to have a limited impact on retail prices in the short term, thanks to the government’s buffer stock management strategy. Going forward, the success of this initiative will depend on effective procurement operations, market monitoring, and continued efforts to balance farmer welfare with inflation control.

FAQs

1. What is the new onion procurement price announced by the government?

The government has increased the Minimum Assured Procurement Price (MAPP) for onions to ₹1,650 per quintal (₹16.50 per kg).

2. When will the new onion procurement rate come into effect?

The revised procurement price is effective from June 13.

3. Why did the government raise onion procurement prices?

The increase aims to improve farmer income, address rising cultivation costs, and strengthen onion buffer stocks for market stabilization.

4. Which farmers will benefit the most from this decision?

Onion farmers in Maharashtra, particularly those in major producing regions such as Nashik, are expected to benefit significantly.

5. Will onion prices increase for consumers?

Experts believe the procurement hike is unlikely to cause a major immediate increase in retail onion prices due to government buffer stock management.

6. What is the purpose of onion buffer stock procurement?

Buffer stock procurement helps the government regulate market supply and prevent extreme price fluctuations.

7. What are farmers demanding despite the price hike?

Several farmer organizations are demanding a procurement price of around ₹3,000 per quintal, arguing that current rates do not fully cover cultivation costs.