Govt to create 1 lakh tons of onion buffer stock in 2020

To prevent the repeat of this year's onion crisis, the Centre has decided to create a buffer stock of 1 lakh tonnes of the key kitchen staple in 2020, a senior government official said on Monday.

The government had created a buffer stock of 56,000 tonnes for the current year but it was not sufficient to contain the prices which are still ruling above Rs 100 per kg in most cities across the country. As a result, the government was compelled to import through state-run MMTC.

"The issue was discussed in detail in the recent meeting of the group of ministers (GoM), headed by Home Minister Amit Shah. It was decided that higher buffer stock of about 1 lakh tonne will be created for next year," the official told PTI.

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 higher shelf life -- between March and July directly from farmers, the official added.

This year, onion prices fell sharply due to 26 per cent fall in kharif and late kharif (summer) production due to late monsoon and later untimely rains in key growing states especially Maharasthra and Karnataka.

To check rising prices, the government took several measures to boost the domestic availability including ban on exports, stock limits on traders besides sale of onion at subsidised rates from its buffer stock and imports.

Already, the government has exhausted its buffer stock of onion which was disposed at a subsidised rate in the local market. Now, it is selling imported ones.

MMTC, which is importing on behalf of the government, has contracted about 45,000 tonnes of onion from Turkey, Afghanistan and Egypt. The shipments are underway.