2010

DEHYDRATED ONION
PROJECT

I. Preliminary Report

Shreekant Nair
Synthite Industries Limited
27/10/2010

Introduction:
Onion is one of the important vegetable crops grown in India. Onion is produced in several states
in India, with Maharashtra being the leading producer accounting for about one-fourth of the
countrys onion production. India largely produces red onions used as fresh produce in the
domestic market. White onions (used for dehydration) are grown on commercial scale only in the
states of Maharashtra and Gujarat and that too only in a few districts
Overview of onion production in country1 as on 19th July 2010

Year
200102
200203
200304
200405
200506
200607
200708
200809

Area in '000

Production in 1000

HA

MT

495.8

5252.1

424.7

4209.5

553.8

6267.6

613.8

7760.6

703.6

9432.5

768

10847

821

13900

834

13565

STATE/UTs

ONION
A

MAHARASHTRA

200.0

3146.0

KARNATAKA

141.3

2266.2

MADHYA PRADESH

57.3

952.3

BIHAR

53.0

972.0

http://www.nhb.gov.in/statistics/area-production-statistics.html

RAJASTHAN

45.0

742.5

GUJARAT

43.4

1078.6

ANDHRA PRADESH

39.0

662.6

TAMIL NADU

35.3

339.7

The production trend of onion from 1991 to 2009 is:

In India, only fresh market onions are grown and that too mostly red onions. White onions are
grown on commercial scale in few states - Maharashtra, Gujarat, that too restricted too few
districts. Red onion is not suitable for dehydration and export primarily due to poor quality, low
productivity, low solids, low pungency level and high reducing sugars. Dehydrator onions are
mostly white, having high solids > 17%; even upto 22-26% total soluble solids (T.S.S.) in some
hybrids; comparatively low moisture content < 84%, globe shaped, having small root base with a
minimum 70 mm diameter. These onions usually have longer shelf-life, free from diseases. Many
white varieties and hybrids suitable for dehydration are cultivated in Europe and North-America.
But they are mostly long-day ones suitable for temperate and sub-tropical long-day conditions.

The white varieties grown in the state is approx 10% of the area under onions. Hence the total
area covered for the production of onion as of 2008-2009 is 83400 HA.
Application of dehydrated onion product:
1.Onion Flakes
Widely used in varied food preparations wherever alongwith onion flavor & taste, onion's appearance
& texture is desired and can be easily used in salads & other preparations / servings after redehydration.
2.Onion Chopped (Size: 3.0 - 5.0 mm)
Used in dry soups, mixes, specialty ethnic food preparations, canned/dried/frozen vegetable mixes,
dry casserole mixes, stuffing mixes, food service & fast food and particularly when large onion pieces
are desired.
3.Onion Minced (Size: 1.0 - 3.0 mm)
Mainly used in preparation of soups, sauces, canned/dried/frozen foods, salad dressings, meat
products and other food products whenever onion flavor or taste is required.
4.Onion Granules (Size: 0.1 - 0.5 mm & 0.5 to 1.0 mm)
Particularly applied in Vegetables & Meat preparations, gravies, sauces, seasoning salad dressings,
cheese, crackers etc.
5.

OnionPowder

Free flowering powder is used in soups, sauces, seasoning, and meat products and suitable for varied
food preparations, particularly when strong onion flavor and taste is desired.

Major Market :
UK, Canada, Germany, Poland, Finland, Denmark, Australia, Spain, Italy, Greece, UAE, France,
Belgium, Netherlands, South Africa, Latvia, Brazil, Colombia, Chile, Argentina, Saudi Arabia,
Bahrain, Philippines, Korea, New Zealand, Japan, Singapore, Israel, South Africa, Russia, East
European countries and many more are the major countries where dehydrated onion products are
exported. According to Maharashtra State Agriculture Marketing Board the export value of onion
from last five years are :

Sr. Year

Onion export from India (Qty. in Lakh Export value in croresRs.

No.

M.T.)

2004-2005

9.44

817.49

2005-2006

7.70

620.27

2006-2007

11.61

1135.42

2007-2008

11.01

1285.82

2008-2009

16.71

1816.14

Source: www.msamb.com

Companies in onion dehydration business.

Name

State

Nature Exports

Gujarat

Jain Irrigation Systems Ltd

Murutuza foods pvt ltd
Pardes Dehydration Company
ABS food technologies
PoojaDehy Foods Pvt Ltd
Natural Dehydrated Veg Pvt Ltd

Maharashtr
a

Gujarat
Gujarat
Gujarat
Gujarat
Gujarat

Market Potential Analysis of dehydrated onion: U.S.A,

Canada & European market

Consumption of Dehydrated Onion In

1. USA market:
In terms of both farm value and per person domestic consumption, onions are one of the top five
vegetables in the United States. In 2008, the average American consumed approximately 20
pounds of onions. Libya has the highest average consumption rate with approximately 66.8
pounds per year. The demand rapidly increased during the 1970s as the popularity of fast food
hamburger chains featuring onions on burgers and onion rings as side orders increased. In the
1980s, the booming popularity of salad bars increased onion demand. By the end of the decade,
demand continued to moderately increase as the growing popularity of pizza, pasta, salsa and
other ethnic cuisines increased. The booming economy of the 1990s propelled demand for awayfrom-home foods, many of which feature onions.

Percent of consumers reporting onion consumption on any given day

Market Potential of dehydrated onion

Onions: Per capita availability (fresh weight equivalent)
Year

Total

Fresh

Total

Processed
Dehydrating

Pounds

1970
1971
1972
1973
1974
1975
1976
1977
1978

11.3
12.2
11.6
11.4
12.7
12.5
11.8
12.4
12.2

10.1
10.7
10.7
10.2
11.2
10.5
11.0
11.1
10.9

1.2
1.5
0.9
1.2
1.5
2.0
0.8
1.3
1.3

1.2
1.5
0.9
1.2
1.5
2.0
0.8
1.3
1.3

1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008

13.4
12.1
11.6
14.2
13.8
14.6
15.2
15.6
14.9
16.2
16.4
16.8
16.6
17.1
18.1
18.1
18.2
18.6
19.2
19.9
20.7
20.0
19.9
19.6
21.2
21.0
23.1
22.7
21.0
23.1

11.4
11.4
10.7
12.2
12.2
13.1
13.6
13.7
13.4
14.5
14.8
15.1
15.7
16.1
17.2
16.9
17.8
18.3
18.8
18.4
18.5
18.9
18.5
19.3
19.5
21.9
20.9
19.9
21.6
19.2

1.9
0.8
0.8
2.0
1.7
1.5
1.6
1.9
1.5
1.7
1.6
2.0
1.6
1.4
2.0
0.9
1.3
0.8
0.9
1.1
2.3
1.6
1.0
1.1
1.8
1.5
1.1
1.8
1.0
1.4

1.9
0.8
0.8
2.0
1.7
1.5
1.6
1.9
1.5
1.7
1.6
2.0
1.6
1.4
2.0
0.9
1.3
0.8
0.9
1.1
2.3
1.6
1.0
1.1
1.8
1.5
1.1
1.8
1.0
1.4

Source: USDA/Economic Research Service. Data last updated Feb. 1, 2010.

If we look at the per capita availability of fresh and dehydrated onion, we can clearly see that the
trend is increasing year by year. Currently the market of dehydrated onion in U.S.A in terms of
quantity is nearly 1.9 Lakh Ton and in terms of value is $ 391 Million

Per capita availability of dehydrated

1.4 pounds (0.63 kg)

onion
Population of USA

310362000

Total market in terms of quantity

1.9 Lakh Tons

1 Kg FOB price of dehydrated onion

(average)

$2

Total market in terms of value

$ 391 Million

Market Potential

Quantity

1.9 Lakh Tons

Value

$ 391 Million

2. CANADA MARKET
The dry onion grown for processing market is

Year

Production (000 T )

Value ( $ Dollar Million)

2004

2005

2006

2007

2008

10

Source: Statistics Canada/ Agriculture and Agri-Food Canada Fall Survey

Dry onion import and export figures in Canada from 1995-2005

Year

Import
000

Export
000

1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005

Tons
120.6
7
114.8
6
126.6
7
127.8
4
134.8
8
133.6
9
156.4
3
157.5
3
166.1
2
150.5
8
154.5

Tons
30.28
37.89
28.79
49
35.66
36.78
59.91
57.38
54.98
61.38
58.23

Source: UN Food & Agriculture stats.

3. Europe Market

Dry onion import and export figure in major European countries from 1995-2005

IMPORT Volume in '000 Tons

Avera
ge

Countries

Germany

1995
303,84
0

1996
314,07
6

1997
233,66
3

1999
256,35
0
114,90
6

70,928

1998
269,03
7
107,16
8
116,06
1
106,04
2

Belgium

83,956

91,693

99,431

France
Netherlan
ds

91,318

76,760

98,830

92,576

84,920

Italy

16,264

24,684

30,559

22,679

20,362

85,077
118,92
8

2000
244,4
02
117,9
81
90,25
5
101,5
27
39,19
0

2001
269,5
00
128,8
02
122,9
05
82,00
0
52,09
3

2002
263,0
59
144,4
35
123,6
09
107,5
28
49,47
1

2003
276,4
97
148,8
20
117,5
30
83,93
0
61,92
3

2004
272,7
96
158,3
33
118,2
93
84,45
5
60,10
8

2005
227,4
58
153,5
50
95,22
6
87,84
0
44,93
7

266,42
5
122,64
3
103,26
0
92,789
38,388

44,34
2
21,39
5
35,98
1
33,70
0
16,19
7

34,76
1
25,14
1
35,93
0
43,82
5
13,03
0

9,758

16,302
6,734

30,19
9
23,90
8
26,79
3
20,78
9
12,60
1
18,40
2
23,16
4
15,32
2
14,56
8
6,390

5,268
4,262

Portugal

10,875

21,477

23,097

27,260

22,096

Sweden

26,090

26,862

20,250

22,344

20,689

Spain

30,008

23,484

33,136

42,435

19,972

Poland

32,696

4,973

36,959

75,823

22,240

Austria

11,958

15,084

16,819

20,562

10,184

Slovenia

7,976

8,599

9,034

9,667

24,752

Hungary

385

83

8,687

7,195

1,449

13,248

10,602

13,862

9,804

3,247

9,858
5,338

9,102
5,565

11,329
5,206

9,967
7,609

7,879
3,665

3,336
1,406

3,063
1,719

8,047
4,891

Greece
Denmark
Finland
Switzerlan
d
Norway
Luxembo
urg

--

--

--

--

--

9,344
15,86
4
14,34
7
4,473

9,457
10,28
5
22,91
9
10,74
5
5,217

36,76
4
24,31
7
20,43
5
54,93
5
15,16
5
12,34
2
22,51
5
29,63
2
11,59
3
5,423

35,57
8
29,82
2
50,48
0
51,06
4
16,53
6
10,53
5
13,61
3
23,09
2
10,98
2
6,290

30,24
6
29,61
4
27,84
8
18,45
5
12,03
1
12,00
4
10,83
1

4,334
4,220

6,325
5,035

7,665
5,453

5,713
4,178

1,366

2,346

2,015

1,901

28,791
24,585
31,500
35,951
14,561
12,048
9,777

9,183

15,161

8,717
5,164

11,592
5,764

9,706
3,404

3,297
3,114

5,876
3,759

1,841

1,526
Total

1,833
82402

4. International Pricing Trend of Dry Onion Bulb

*cents/pound

Season
Commodity

Year

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sep.

Oct.

Nov.

Dec.

average

Onions,

2006

8.53

8.19

7.60

15.20

16.30

17.80

14.90

13.30

12.40

10.40

11.40

16.60

16.10

dry bulb

2007

22.10

26.20

35.00

55.20

24.20

24.60

15.40

10.80

5.57

4.47

4.70

4.39

11.10

2008

4.13

3.15

2.53

10.60

23.90

17.60

13.10

8.72

11.20

11.50

10.90

9.71

12.50

2009

9.47

8.44

6.99

18.40

13.40

18.00

10.80

8.58

9.24

8.23

7.97

7.93

12.20

2010

11.90

16.70

40.00

60.40

43.90

29.20

24.20

The market for dehydrated vegetables is estimated at 900,000 tones. Onions and garlic account
for the biggest portion of this demand, 27% and 13%, respectively. The global market for
dehydrated onions is expected to grow at a compounded annual rate of 5% for the next four
years. The major markets for dehydrated onions are in the USA, Europe and Japan. Dehydrated
onions are widely used by manufacturers of soups, sauces, pizzas, ketchups, and fast-foods.

II.

SWOT Analysis

Strengths

Weakness

Established in market as quality

ingredient manufacturer

Strong customer base, they will

be the potential customer for
dehydrated onion.

Our major strengths would lie

in producing quality products.

Opportunities

Highly untapped market hence

Threats

Competition faced by highly

huge potential is there

established

player

Market is estimated at 243000

Irrigation Systems Ltd whose

Tons

current

revenue

Jain

from

this

sector is 400 Cr.

Procuring raw material from the

belts

of

Maharashtra

where

Jains have good control over

farmers
farming.

through

contract

Conclusions:

The dehydrated onion market looks highly potential because the market is estimated at
243000 Tons.

There is a growing demand for dehydrated onion products in Western countries.

The dehydrated onion plant can be used for the dehydration of vegetables during off
season. Dehydrated garlic, carrot, peas, tomato are in great demand from Western
countries.

The location would be a major factor: Gujarat (Rajkot, Mahuva) and Maharashtra
(Nashik) seems to be the potential location due to easy availability of raw materials and
easy access to ports.

Source of Information:

www.jains.com

www.ers.usda.com

Horticulture board of India

NAFED: National Agriculture Cooperative Marketing Federation Of India Ltd

United Nations Food & Agriculture Stats

Maharashtra State Agriculture Marketing Board