Onion Market Faces Surplus Pressure as Arrivals Surge and Prices Soften

The Indian onion market is currently experiencing classic supply-side pressure, particularly in major hubs like Gondal and Mahuva, as hefty inflows of fresh produce outpace existing demand. With arrivals at Gondal breaching the 12,000 quintal mark and Mahuva’s figures reaching 3,000 quintals, average prices have noticeably softened. The delicate balance between robust arrivals and moderate demand has kept market sentiment cautious. Traders report that although some support came from seasonal and festival-related needs, it was insufficient to counter the price drag from sustained inflows.

The trend has kept onion prices under pressure, especially in lower and medium grades, and unless demand perks up or arrivals ease, this downward momentum could persist through the week. Exporters and processors are closely watching how these arrivals might impact export-oriented grades like powder, flakes, and fresh variants. For food processors and traders, the current market dynamic may present opportunities to secure lower cost inputs if swift action is taken.

📈 Prices

Market/Product	Type/Grade	Origin	Location	Delivery	Latest Price	Weekly Change	Sentiment
Gondal Mandi	Fresh	IN	Gondal	Mandi Price	$0.046–$0.40/kg	-5% to -10%	Bearish
Mahuva Mandi	Fresh	IN	Mahuva	Mandi Price	$0.042–$0.38/kg	-4% to -8%	Bearish
Onion Powder	Grade B	IN	New Delhi	FOB	€1.33/kg	0%	Stable
Onion Powder	White	IN	New Delhi	FOB	€1.60/kg	0%	Stable
Onion Powder	Organic	IN	New Delhi	FOB	€2.68/kg	0%	Stable
Onion Flakes	Organic	IN	New Delhi	FOB	€5.15/kg	0%	Stable
Onion (Fresh)	Conventional	EG	Kairo	FOB	€0.81/kg	0%	Stable
Onion (Fried)	Crispy	PL	Lodz	FCA	€3.42/kg	0%	Stable

🌍 Supply & Demand

• Arrivals: Substantial increase, with Gondal crossing 12,000 quintals and Mahuva at 3,000 quintals.
• Market Pressures: High arrivals causing a surplus, outweighing moderate domestic demand and limited festival boost.
• Stock Movements: Stock build-up likely as demand trails arrivals, especially in low and medium grades.
• Export Demand: Exporters showing interest for processed products amid persistent lower fresh market prices.

📊 Fundamentals

• Price Ranges: Marketwide, fresh onions trading as low as $0.042/kg, with top quality at $0.40/kg in major regional mandis.
• Process Product Stability: Processed and value-added products (powder, flakes, fried onions) mostly see stable pricing in EUR terms, suggesting steady overseas demand.
• Speculation and Positioning: Bearish market mood, with limited price support from traders and increasing risk of further downside if arrivals persist at current levels.

☀️ Weather & Yield Outlook

• Gujarat & Maharashtra: Short-term weather projections indicate normal monsoon conditions. No immediate threat from excess rain or drought, ensuring steady harvest flows into key markets.
• Crop Quality: Sound crop health expected, with no weather disruptions forecast in the next week. Continued strong arrivals likely.
• Potential Effects: Normal conditions mean prices could stay subdued, with minimal risk of weather-driven rally in the coming days.

🌐 Global Production & Stock Comparison

Country	2024 Production (est.)	Major Export Destinations	Key Remarks
India	23.6 mln MT	Bangladesh, Malaysia, Middle East, EU	Arrivals strong; domestic stocks up; cautious on fresh exports post-ban periods
Egypt	3.5 mln MT	EU, Russia, Gulf	Firm supply; price competitive in FOB markets
Netherlands	1.7 mln MT	EU, Africa	High quality offered; stable stocks

📆 Market Outlook & Trading Recommendations

• 🟢 Buyers: Consider bookings for processed onion products (powder, flakes) at current flat prices.
• 🟡 Exporters: Monitor domestic arrivals for possible lower grade collection, but be cautious of inventory build-up.
• 🔴 Traders/Stockists: Avoid aggressive long positions as fresh prices likely to remain under pressure with ample arrivals.
• 🟢 Processors: Opportunity to cover raw material at discounts may persist if arrivals stay firm and exports remain capped.
• 🔵 Monitor: Festivals and government policy changes could give unexpected support—track closely.

📉 3-Day Price Forecast

• Gondal Mandi (Fresh): $0.045–$0.39/kg, weak bias. Arrivals set to stay high.
• Mahuva Mandi (Fresh): $0.040–$0.37/kg, drifting lower in absence of sharp demand pick-up.
• Processed Exports (FOB INR/IN & EUR): Flat to mildly weaker, no immediate price upside seen.