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Onion prices kept below production cost in 2025, farmers under pressure
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Saturday, 03 January, 2026, 13 : 00 PM [IST]
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Our Bureau, New Delhi
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Onion prices remained below the cost of production for a large part of 2025, putting significant financial stress on farmers, even as consumers benefited from stable retail prices, according to industry and trade sources.
Despite steady arrivals from major producing states such as Maharashtra, Madhya Pradesh and Karnataka, farmgate prices failed to keep pace with rising input costs. Higher expenditure on seeds, fertilisers, labour, transportation and storage pushed up the cost of cultivation, while market prices remained subdued due to policy interventions and ample supply.
Traders said average wholesale prices in key mandis frequently hovered below levels considered remunerative for farmers. In several instances, onion prices dipped to Rs 800–1,200 per quintal, while production costs were estimated to be significantly higher, eroding farmer margins.
Government measures aimed at protecting consumers—including restrictions on exports, stock limits and calibrated market interventions—played a role in keeping prices under control. While these steps helped prevent sharp price spikes, farmer groups argue that prolonged suppression of prices has discouraged investment and affected income sustainability.
The situation was further compounded by higher post-harvest losses, limited cold storage availability and weak bargaining power for small and marginal farmers. Many growers were forced to sell produce immediately after harvest due to lack of storage, adding to downward pressure on prices.
Experts caution that consistently low realisations could impact future sowing decisions, potentially leading to acreage shifts in the coming seasons. Any reduction in onion cultivation may result in supply volatility and price spikes later, a recurring challenge in India’s onion market.
The government has reiterated its commitment to balancing farmer welfare with consumer interests and said it is closely monitoring price trends and supply dynamics. Industry stakeholders have called for long-term solutions, including improved storage infrastructure, predictable export policies and price stabilisation mechanisms.
As the new year begins, onion farmers continue to seek policy support that ensures fair returns while maintaining market stability an issue that remains central to India’s agri-pricing debate.
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