1. Commodity News

Centre to Create 1 Lakh-tonne Buffer Stock to Tackle Onion Crisis in 2020

Pronami Chetia
Pronami Chetia

To manage the huge onion crisis that created lots of hue and cry across the nation last year, the central government has decided to create a buffer stock of 1 lakh tonnes of the key kitchen staple in 2020, said a senior government official. As per reports, the government had created a buffer stock of 56,000 tonnes for the current year. But reports claimed that it was not sufficient to contain the prices which are still ruling above ₹100 a kg in most cities. As a result, the government has been compelled to import via State-run MMTC.

“The issue was discussed at the recent meeting of the Group of Ministers (GoM), headed by Home Minister Amit Shah. It was decided that a higher buffer stock of about 1 lakh tonne will be created for the coming year,” said the official to media.

Cooperative Nafed, which had maintained the buffer stock of onion on behalf of the government, will continue to do so next year. It will source the rabi (winter) onion crop — which has a longer shelf-life — between March and July directly from farmers, the official added.

Last year, onion prices witnessed a sudden hike due to a 26 percent drop in Kharif and late Kharif (summer) production due to the late monsoon and later untimely rains in key growing states like Maharashtra and Karnataka.

Moreover, the government took several measures to boost domestic availability including a ban on exports, stock limits on traders besides the sale of onion at subsidized rates from its buffer stock and imports.

The government has decided to exhaust its buffer stock of onion which was disposed at a subsidized rate in the local market. Moreover, the government has contracted about 45,000 tones of onion from Turkey, Afghanistan, and Egypt which shipments are underway.

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