Context: All-India average onion price rose to ₹49.59/kg on 1 September 2026, up over 74% year-on-year, despite adequate estimated production.
- Production 2025–26: 307.37 lakh tonnes, almost unchanged from 307.67 lakh tonnes in 2024–25; domestic supply considered adequate.
- Key reason: Lower quality of onions, particularly due to delayed rains and delayed harvesting in Maharashtra, India’s largest onion-producing State.
- Seasonal factor: Onion prices typically rise during August–September due to festive demand, weather conditions and supply-chain movements.
- Hoarding: Large farmers/traders reportedly holding stocks in cold storage in anticipation of higher prices; government attributes the sudden surge partly to hoarding and black marketing.
- Government response: Calibrated release of onion buffer stocks; onions being sold at ₹35/kg to increase market supply and discourage hoarding.
- Exports: India exports roughly 15 lakh tonnes of onion annually.
- Prelims Link: Onion is an essential commodity under the Essential Commodities Act, 1955, enabling the government to regulate its supply under specified circumstances.
