India's onion exports are back on stable ground this season, supported by strong production, eased government policies, and a growing demand in Asian markets, says Harsh Jariwala, Managing Partner at onion exporter Raion Export. "So far it's been a promising season compared to last year, particularly after the government removed export duties and restrictions," he mentions.
"In May 2024, the Indian government had imposed a 40% export duty and a Minimum Export Price (MEP) of $550 per metric ton," Jariwala explains. "This was later relaxed in September, with the duty reduced to 20% and the MEP being removed. Now, there is no duty or MEP at all, which has made Indian onions more competitive," he adds.
© Raion Export
On the supply front, Jariwala notes India is seeing a substantial increase in onion production this year: "Compared to last season, onion production is up by about 25%, with farming activity in Nashik increasing by nearly 60%. The rise in output has helped stabilize prices and improve export volumes in contrast to last year's low production and export restrictions straining the market."
While the season has been more favorable overall, exporters continue to face some challenges. "Unseasonal rainfall created supply-chain hurdles and affected onion quality during procurement. Additionally, high freight charges have put pressure on exports to Gulf countries. Asian markets are more cost-effective, although with longer delivery times. To address these, we focus on bulk procurement to reduce per-unit costs and offset high freight charges to some extent," Jariwala shares.
© Raion Export
According to him, demand from countries such as Malaysia, Vietnam, and Sri Lanka has remained strong. "Malaysia household and food service consumption for onions is high, while Vietnam is becoming a major re-export hub for supplies to countries like Cambodia and Laos. Sri Lanka continues to rely heavily on imports due to domestic supply gaps," he adds.
Compared to last year, wholesale prices are slightly lower due to higher production. "In July 2024, wholesale prices were around USD 0.3 per kg; this year, they are closer to USD 0.23 per kg," Jariwala shares. "The stock that was stored post-harvest is now entering the market, and with the festive season approaching, we expect both domestic and international demand to push prices higher," he concludes.
For more information:
Harsh Jariwala
Raion Export
Tel: +91 93283 10916
Email: [email protected]
www.raionexport.com
