Government hikes onion procurement rate to Rs 16.5 per kg from June 13 to help farmers

📌 Summary:

• The government raised the onion procurement price under its buffer stock (Price Stabilisation Fund) programme to Rs 16.50 per kg from June 13, up from Rs 15.80 per kg
• Aim: support farmers' incomes amid soft market prices, especially in Maharashtra, the largest onion-producing State
• Maharashtra farmers are demanding Rs 30 per kg, citing high input costs
• Buffer stock procurement helps stabilise prices in both directions — supporting growers when prices crash and releasing stocks to cool retail prices during spikes
• Reflects the dual policy challenge of protecting producers without stoking food inflation for consumers

🎯 UPSC Relevance: GS3 Economy — agricultural marketing, price stabilisation, buffer stocks, and balancing farmer incomes against consumer food inflation.

📝 Prelims Facts:

• The Price Stabilisation Fund (PSF) supports buffer stocks of onions and pulses; NAFED and NCCF are key procurement agencies
• Maharashtra is India's largest onion-producing State; Lasalgaon (Nashik) hosts Asia's largest onion wholesale market
• New procurement rate: Rs 16.50/kg (from Rs 15.80/kg), effective June 13, 2026

🔑 Key Term: Buffer stock — government-held reserves of a commodity built up to stabilise prices and ensure supply during shortages or gluts.