Centre to sell subsidised onions at ₹35 per kg in Delhi amid rising market prices

The Central Government is set to begin the retail sale of onions at a subsidised rate of ₹35 per kg in the national capital starting Thursday. Union Food Minister Pralhad Joshi is scheduled to inaugurate the subsidised sale, according to a senior official in the consumer affairs ministry.

The market intervention comes in response to a steep spike in onion prices over the past month. The all-India average retail price rose over 28 percent to ₹44.72 per kg on August 25, up from ₹34.80 per kg a month earlier. Compared to the previous year, when onions retailed at ₹28.67 per kg, prices have jumped by 56 percent. In several metropolitan areas, retail prices reached ₹60 per kg in Chennai and Kolkata, ₹55 per kg in Delhi, ₹48 per kg in Mumbai, and ₹38 per kg in Ranchi on Wednesday.

Wholesale prices have followed a similar upward trajectory, with the average wholesale price standing at ₹36.73 per kg on August 25. This marks a 63 percent increase year-on-year and a 33.5 percent rise over the past month. Government officials attribute the price increase to a usual seasonal uptick between August and September, driven by festive demand, weather-related disruptions, supply chain movements, and shifting consumption patterns.

To manage the price surge, the government is releasing onions from a buffer stock of 1.21 lakh tonnes maintained across producing states for 2026. The retail intervention is being carried out through three primary agencies: Nafed, NCCF, and Kendriya Bhandar.

Anice Joseph Chandra, Managing Director of the National Cooperative Consumers' Federation of India (NCCF), stated that the agency will start sales in Delhi and extend them to the NCR region by the weekend. NCCF, holding a buffer stock of 62,000 tonnes of onions, is transporting 400 tonnes from Nashik, Maharashtra, via a dedicated railway rake christened 'Kanda Express'. The cooperative agency will retail onions through 100 Kendriya Bhandar stores, discussions are underway with Mother Dairy for sales through its 300 outlets, and an initial deployment of 15 mobile vans will scale up to 40.

Supplies arriving via rail rakes will also be used for retail distribution in Chandigarh, Ludhiana, Varanasi, and other cities. Nafed, which maintains a buffer of less than 55,000 tonnes of onions, will similarly sell onions in Delhi and other centres including Kochi and Guwahati. In addition to Delhi, four other centres—Chennai, Ernakulam, Madurai, and Guwahati—are set to receive onion supplies through dedicated rakes, although bookings for these specific routes are pending.

Despite the current price surge, the government maintains that overall onion availability remains adequate to meet domestic demand in the coming months. This assessment is supported by an estimated 2025-26 production of 307.37 lakh tonnes, which is broadly on par with the 307.67 lakh tonnes recorded in the previous year.

"Government interventions through strategic buffer stock releases and dedicated transport logistics like the Kanda Express play a crucial role in stabilizing consumer markets during seasonal supply chain shocks. For businesses operating in the retail and agricultural supply sectors, monitoring these governmental price stabilization measures is essential for anticipating market corrections and managing input costs effectively during periods of high inflationary pressure." — Dr. Shishir Gupta, Founder & CEO, StartupLanes