Amid soaring prices, dehydrated variety provides hope

Dehydrated onions were about 10 times cheaper than fresh variety sold in market

Even as persistently high onion prices have led to concern among the government as well as consumers, the dehydrated variety of the commodity seems a promising option. Experts, however, say Indians prefer fresh onions and the use of dehydrated onions is confined to packaged food companies and hotels.

Sources said dehydrated onions were about 10 times cheaper than the fresh variety sold in the market. And, a kg of dehydrated onions accounts for 10 kg of fresh ones, after water is added to it. The dehydrated variety could cost about Rs 150 a kg in the retail market, provided fresh onions are purchased at about Rs 10-12 a kg in wholesale markets for dehydration. The cost to dehydrate 10 kg of fresh onion is Rs 30.

Last week, Ashok Gulati, chairman of the Commission for Agricultural Cost and Prices, had recommended the use of dehydrated onions during scarcity. Typically, August and September and, sometimes, October see a shortage of the commodity, as the market awaits new arrivals. “At such times, dehydrated onions could be of much use and a sudden spike in prices could be averted,” Gulati had said.

Hyder Meghani, managing director of Natural Dehydrated Vegetables, said, “Indians prefer to eat fresh onions in routine meals. Ready-to-eat food makers, hotels and the catering industry are some of the buyers of dehydrated onion in India.”

As a kg of the variety would yield about 10 kg of normal onions (on addition of water), effective prices would fall significantly.  “Onion dehydration has a very nominal presence in India. If we take care of a few things, anyone can store it at home for future consumption. The shelf life of dehydrated onions is two year,” said Asgar Chattariya, secretary, All India Dehydration Association. His company, Chhatariya Dehydrates Exports, is one of India’s largest dehydrated onion production and export companies.

Though dehydrated onions can be stored in air-tight boxes for two years, once water is added, its shelf life is reduced to just two hours.

This variety is exported in large volumes. Recently, following the steep rise in onion prices, the new season for the onion dehydration industry is likely to be delay by a month or two.

“The domestic price of onions is a major factor for us. Currently, prices are too high; we are waiting for the new crop to come in December; if price don’t fall below Rs 10 a kg, we will not open our unit. According to trends in prices in the export market, if the price of fresh onions is more than Rs 10 a kg, dehydration is not viable,” said Vitthalbhai Koradiya, managing director, Maharaja Dehydration, Mahuva (Gujarat). According to industry estimates, dehydrated onion stocks in India stand at 200-250 tonnes.

There are 90 onion dehydration units in India, with a combined capacity of 90,000 tonnes a year. Of these, 75 units are located in Gujarat—-at Bhavnagar, Mahuva, Vadodara and Gondal. Maharashtra, Madhya Pradesh and Rajasthan account for the remaining units. Most of the dehydrated onions are exported to countries such as the US, the UK, the Gulf countries and Australia. Setting up an onion dehydration unit is an expensive affair, especially when the domestic market isn’t seeing good demand. “To set up a dehydration unit, one needs at least Rs 3 crore of investment. Most of the plant machinery is available in India,” said Hitesh Parekh, managing director of Pardes Dehydration Company, Gondal.

“Typically, white onion is used in dehydration and the quality of this commodity in Gujarat is better than other places in India. With the easy availability and cheap labor, this industry has grown here,” said Koradiya.

As per Agricultural and Processed Food Products Export Development Authority (APEDA), onion production during 2012-13 was about 16.30 million tonnes in India, previous year it was 17.51 million tonnes. Maharashtra is the largest onion producing state with share of 28.57 percent, followed by Karnataka and Madhya Pradesh with 14.69 and 13.19 percent respectively. Gujarat is having nearly 4.32 percent share in onion production in the country.

The Directorate General of Commercial Intelligence and Statistics (DGCIS) data said that fresh onion export from India during 2012-13 was registered 1.63 million tonnes as against 1.30 million tonnes in 2011-12.