Is the price increase of Indian onions an opportunity for Chinese exporters?

In recent years the price of Chinese onions was around 1 yuan [0.14 USD] per 0.5 kg. In the first half of this year the price of Chinese onions dropped to 0.5 yuan [0.07 USD] per 0.5 kg. In the second half of this year, however, the price began to rise again. At this point, many farmers began to pay attention to onions.

The reason that Chinese farmers began to pay attention to onions is that the Indian onion market experienced significant changes. Under normal circumstances the price of Indian onions is around 1 rupee [0.01 USD] per 0.5 kg. That is the same as 0.1 yuan [0.01 USD] per 0.5 kg. However, recently the price of Indian onions suddenly increased to 80 rupees [1.13 USD] per 0.5 kg, which is the same as 8 yuan [1.13 USD] per 0.5 kg. This sudden price increase created a great contrast between the price of Indian onions and the price of Chinese onions.

Why did the price suddenly rise? The production volume of Indian onions rapidly declined because of excessive rainfall in onion production areas in September. The price then began to rise.

In order to secure a sufficient supply to the domestic onion market, the Indian government halted onion export. Many nearby countries are unable to purchase their usual amount of onions from India. Furthermore, many of these countries heavily rely on these onions. They are therefore turning their attention to the Chinese onion market.

This opportunity is also a challenge. Next year, Indian onion production will resume and this will affect Chinese onion export. The price of Chinese onions is likely to drop back to 0.5 yuan [0.07 USD] per 0.5 kg again. The domestic market can only absorb a limited amount of onions.

Source: Jinri Toutiao


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