Bangladesh Chooses Indian Onions Over Others

Bangladesh now imports more onions from India, focusing on supplies from southern regions. The Indian Government reduced the export duty on onions to 20 percent, which boosted exports. "We send 20-25 tonnes of onions to Bangladesh every day from Bangalore. Shipments also go out from Tadepalligudem in Andhra Pradesh," said M Madan Prakash, President of the Agricultural Commodities Exporters Association (ACEA).

Ajith Shah, President of the Horticultural Crops Exporters Association (HCEA), added, "Bangladesh prefers fresh onions. They pick from the new crop now arriving in southern India."

Trade Increases After Duty Cut

India’s recent reduction in export duty and removal of the USD 0,55 per kg minimum export price (MEP) on September 15 led to a rise in onion exports. India had imposed an export ban in December 2023 after the kharif crop suffered from drought, particularly in Maharashtra.

The Ministry of Agriculture estimates that onion production for 2023-24 will reach 24,21 million tonnes, down from 30,2 million tonnes last year. India lifted the export ban in May, but the 40 percent duty and USD 0,55 per kg MEP remained in place until recently. By August, Union Minister BL Verma announced that India had already exported 260,000 tonnes of onions since the ban lifted.

Smaller Onions Are in Demand

Bangladesh prefers onions sized 45 mm and below, avoiding the larger ones over 50 mm. "They stick to smaller onions, while other markets demand the larger ones," said Shah. Prakash noted that onions of 45 mm sell for USD 0,42-0,46 per kg, while smaller ones go for USD 0,31-0,34 per kg.

Shah emphasized that Bangladesh remains the primary buyer right now. Other markets prefer larger onions, but Pakistan competes by offering lower prices. Pakistan sells onions above 50 mm at USD 0,60 per kg, while India's price sits at USD 0,80 per kg for the same size.

Onion Prices Hit a 10-Year High in India

Onion prices in India have surged to a decade-high. At Nashik's APMC yard, which serves as the onion trading hub, prices recently hit USD 0,54 per kg. Domestic and export demand has driven this sharp increase.

Conclusion: Bangladesh Drives Indian Onion Exports Despite Price Surge

Bangladesh’s preference for smaller onions has pushed India's exports higher. The reduction in export duty fueled this trade, though domestic onion prices keep rising. India must balance local and international demand while Pakistan offers cheaper options for larger onions.

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