Home / Business and Economy / Onion Buffer Saves Consumers Millions!
Onion Buffer Saves Consumers Millions!
12 Dec
Summary
- Onion price volatility dropped by 24% due to buffer stock.
- Consumers saved 36-45% on onions during disposal months.
- Farmers received 3-19% higher prices and faster payments.
A new evaluation reveals the Indian government's onion buffer program, managed by the Price Stabilisation Fund (PSF), has successfully reduced retail price volatility by 24%. During disposal months, consumer prices were 36-45% below market rates, despite the PSF procuring only a small fraction of national output. This initiative has become central to India's price stabilization strategy. Reforms such as faster farmer payments, dual-season procurement, and improved logistics have boosted farmer incomes by 3-19% above mandi rates, reducing distress sales. Direct benefits have reached over 18,000 farmers, with significant indirect beneficiaries across the value chain. The PSF's scale of operations has expanded dramatically since 2018. Technological integration and diversified distribution channels have further enhanced the PSF's effectiveness, reducing transportation losses and costs. The fund, originally established for plantation crops in 2003, was expanded in 2014-15 to cover essential agri-horticultural commodities, demonstrating its evolving role in ensuring market stability.
