Govt Directs NCCF, NAFED To Start Buying 5 Lakh Tonnes of Onion Directly from Farmers
The government has directed the NCCF and the NAFED to start buying 5 lakh tonnes of onion for the country’s buffer requirement directly from farmers as the Rabi-2024 harvest has begun arriving in the market, the food ministry said on Tuesday.
Government procurement agencies NAFED and NCCF have been told to pre-register the onion farmers to ensure that payments for the produce are transferred to their bank accounts through direct benefit transfer (DBT).
Rabi onion crop is critical for the country’s onion availability as it contributes 72% -75% of annual production in the country. The Rabi onion is also crucial for ensuring year-round availability of onion as it has a better shelf life compared to the Kharif onion and can be stored for supplies till November-December.
The Department of Consumer Affairs had, through NAFED and NCCF, purchased about 640,000 metric tonnes of onion during 2023-24 for buffer stocking as well as intervention by way of simultaneous procurement and disposal. The continuous procurements by NAFED and NCCF had guaranteed remunerative prices for onion farmers all through 2023.
Subsequently, the department of consumer affairs adopted the retail sale intervention for making onion available to consumers through retail outlets and mobile vans operated by NCCF, NAFED, Kendriya Bhandar and other State-controlled cooperatives at a subsidised price of Rs25 per kg during last year. The timely intervention and calibrated release ensured the stabilisation of retail prices effectively without impacting the earnings of farmers.
The global supply scenario and dry spell induced by El Nino necessitated the government to take up policy measures to regulate onion exports during FY23-24. These measures included a 40% duty on onion exports imposed on 19 August 2023, imposition of a Minimum Export Price (MEP) of US$800/MT with effect from 29 October 2023, and export prohibition w.e.f. 8 December 2023, to ensure the availability of onion to domestic consumers at affordable prices.
The recent decision to extend onion export prohibition has been necessitated by the overall domestic availability against the prevailing international prices and global availability concerns.
Meanwhile, the government has allowed exports to neighbouring countries that rely on India for their domestic consumption requirements. These countries include Bhutan (550MT), Bahrain (3,000MT), Mauritius (1,200MT), Bangladesh (50,000MT) and the UAE (14,400MT i.e. 3,600MT/ quarter).
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