Onion Guide

Production Supply Chain

What Factors Affect Onion Prices?

According to the FAO, here’s the list of the factors that tend to be the most responsible for price changes:

- Handling cost

- Refrigerated storage cost

- Shipping cost

- Labor cost and packing materials

- Input costs: labor, mechanization, fertilizer, insecticides, pesticides, herbicides, fuel, and electricity

- Yield quantity

- Onion exporter union

- Price of the goods/products on the market

- Technological factors

- Climate condition

- Storage possibilities

General Product Introduction

What does worldwide consumption of onions look like?

Worldwide consumption of onions is thought to be around 105B annually, approximately 13.67 pounds per person. Onions are some of the oldest cultivated vegetables. A staple product in Southeast Asian and Middle Eastern cuisine and is used widely throughout the world. Consumption has grown substantially in the US, the top importer, as well as worldwide in the last two decades. 

Which country tends to have the cheapest onions?

As of 2020, along with Indian onions, China is considered to have some of the cheapest onion prices in the world. In China, onions are produced across the country throughout the year, with red onions particularly popular in Southeast Asian markets such as Malaysia, Thailand, and the Philippines. There is ample availability of onions for this season as well as increases in planting areas, adding pressure to an already hard year for suppliers from a bumper harvest in India.

Trade Overview

What are some promising/emerging markets for onion production and/or export?

Quite a few markets in Central Asia seem to be emerging. For example, Uzbekistan wasn’t exporting more than USD 7 million before 2018. In 2019, exported almost USD 70 million, almost cracking into the top 10 exporters in the world. Pakistan similarly went from exporting USD 12 million to 67 million in the same period, while Afghanistan suddenly jumped to USD 38 million in 2019 having not recorded any export values in previous years. While none of it is necessary major markets, it may only be a matter of time.

Otherwise, the top five exporters are the Netherlands, China, India, Mexico, and the United States. The latter three countries have seen varying but relatively stable export values since 2010, while the Netherlands and China, outside of a few outlier years, have been growing in export values, reaching the highest values in 2019.

Here’s a graph based on ITC Trade Map Information concerning the export values of the top 10 exporters of onions:

And here’s a graph based on more ITC Trade Map Information concerning the overall change in total exports since 2010:

What are the fastest changing import markets for onion?

In terms of growth, the fastest-growing buyer of onions is the Netherlands. From 2010 to 2016, they typically ordered less than USD 100 million worth of onions each year. In 2019, they imported USD 197 million, more than double what they imported in just 2015.

In terms of decline, the three markets that have regressed the most are Bangladesh, Russia, and Brazil. In 2010, Brazil imported USD 107 million worth of onions. Recently, they have struggled to exceed values higher than USD 80 million, averaging between USD 30-65 million each year since 2010. Bangladesh had an outlier year where they imported USD 2020 million in 215, but otherwise, they returned to under USD 100 million levels. Finally, Russia, which once imported between USD 170-200 million, has rarely imported values over 100 million.

Which countries are the largest importers of onion?

The main importing markets of onion by value are:

1. USA - $471.3M

2. Malaysia - $211.3M

3. United Kingdom - $188.2M

4. Germany - $180.6M

5. Bangladesh - $169.2M

Seasonality of Main Producing Regions

What are the most popular varieties of onion produced for export?

While there are various types of onions, they are mainly categorized into Yellow (Brown), Red (Purple), and White onions.

• The Yellow (Brown) onion is a dry onion variety with a strong flavor and tough outer skin. With a balance of astringency and sweetness, yellow onions are often the go-to variety for cooking and become sweeter the longer they are cooked.
• Red (Purple) onions are generally medium to large in size and are round to oval in shape, containing higher levels of flavonoids and fiber compared to their yellow and white counterparts.
• White onions are the least common types of onions, exhibiting very thin skin almost akin to paper. They are popularly used in Mexican cuisine and are more pungent than yellow onions.
• Sweet Onions are not as pungent, due to lower sulfur content and higher water content as the other varieties. Walla Walla and Vidalia are the most commonly known types of sweet onions.
• Shallots are generally smaller and exhibit purple flesh, with bulbs consisting of a structure similar to cloves on garlic. Not commonly used for consumption in the United States, shallots are frequently used in Southeast Asian dishes and are considered to be sweeter “regular'' onions.
• Green Onions often referred to as scallions, are onions that have not fully matured and formed bulbs, or varieties that do not actually form bulbs. They are long with a green upper part and a white stem at the bottom.

What are the UNECE grades for onions?

• Class I: For the Class I grade, onion bulbs must be firm and free from externally visible shoots, and swelling caused by vegetative development and be free of root tufts for mature products. Slight defects in shape and coloring are allowed, with light staining and superficial cracks allowed as long as it does not affect the product more than a certain degree.
• Class II: Class II onions are products that do not qualify for Class I but should nevertheless meet the minimum requirements in bulb firmness, with defects in shape and coloring, etc. allowed to the degree that the products keep the quality and presentation. 

Which countries are the largest producers of onion?

These are the top producing countries of onion by volume:

1. China - 20.51 million MT

2. India - 13.37 million MT

3. United States - 3.32 million MT

4. Egypt - 2.21 million MT

5. Iran - 1.92 million MT

6. Turkey - 1.90 million MT

Packaging

What is the industry norm packaging?

Mesh bags of 20/25 KG are most commonly used for onion.