- Average onion prices rise 19% in a month to INR 42/kg, with Delhi at INR 65/kg
- Kanda Express to move buffer stock from Nashik to Delhi, Chennai, Kochi and Guwahati
India’s average retail onion price rose to INR 42/kg on Saturday, up 45% from a year earlier and 19% from a month ago, prompting the Centre to step up market intervention. From Monday, the government will move buffer-stock onions from Nashik to Delhi, Chennai, Kochi and Guwahati through Kanda Express trains, targeting markets where prices are above the national average.
Onion prices rise across major markets
According to consumer affairs department data, retail onion prices in Delhi reached INR 65/kg on Saturday, compared with INR 35/kg a year earlier. In Chennai, prices rose to INR 58/kg from INR 33/kg last year. Prices have also remained elevated in parts of Kerala and Assam.
The government plans to release onions at lower prices in a calibrated manner to contain the price rise. Officials said there may be instances of traders pushing up prices artificially, while maintaining that sufficient stocks are available with both the government and farmers to meet demand in the coming months.
The government had last operated Kanda Express from Nashik to Delhi and other parts of the country in October 2024 to curb rising onion prices.
Lower kharif output adds to price pressure
Market participants attributed part of the recent price increase to expectations of a 5-7% decline in Maharashtra’s kharif onion production. Maharashtra is the largest onion-producing state, and lower output could tighten supplies in major consuming markets.
Two farmer cooperative agencies have procured around 120,000 tonnes of onions for the current fiscal year as part of the government’s buffer stock programme. Their procurement price was initially fixed at INR 1,270/quintal in May but was raised to INR 2,645/quintal last week to accelerate procurement.
According to the agriculture ministry’s second advance estimate, India’s onion production for the 2025-26 crop year is projected at 30.7 million tonnes, broadly unchanged from 2024-25.
Sugar prices continue to rise
Retail sugar prices have also remained elevated. Loose sugar was selling at INR 62.5/kg on Saturday, up 34% from a year earlier and 28.5% from a month ago.
In Delhi and Mumbai, sugar prices stood at INR 65/kg and INR 69/kg, respectively. The food ministry maintained that sufficient sugar is available to meet domestic demand.
Outlook
The movement of buffer-stock onions through Kanda Express is expected to improve supplies in high-priced markets and ease near-term price pressure. However, expectations of lower kharif production in Maharashtra and the pace of farmer selling will remain key factors for onion prices in the coming weeks.
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