Garlic emerges as the leader in India’s spice export basket

Major export items of spices, such as chilli, cumin, mint products and spice oleoresins, have all declined while garlic shipments have zoomed 165 percent in volumes from April to January 2022-23, compared to the same period in the previous year, as per Spices Board data

Garlic has emerged as the star performer in India’s spice export basket in 2022-23, outclassing other major shipments, thanks to the rising demand and high prices and diminished presence of the Chinese variety in global markets.

Major export items of spices, such as chili, cumin, mint products and spice oleoresins, have all declined while garlic shipments have zoomed 165 percent in volumes from April to January 2022-23, compared to the same period in the previous year, as per Spices Board data.

At 47,329 tonnes for the 10 months, garlic export has surpassed the peak of 46,980 tonnes in 2017-18. With figures for two more months yet to come in, garlic export is expected to cross 50,000 tonnes. In terms of value, there is a 34 percent rise in 10 months at Rs 205.57 crore. In 2021-22, India’s garlic exports stood at 22,181 tonnes, worth Rs 186.19 crore.

China in the global garlic market

``The China garlic crop is down by 20-25 percent. This has raised export enquiries for Indian garlic, particularly from some West Asian and African countries,’’ said Vijay Hotwani, managing director of Varchasva Agro, an exporting firm based in Madhya Pradesh, the largest garlic-producing state in the country.

China accounts for around 75 percent of the global garlic output, making it the largest producer by a large margin. Its production comes to 20-25 million tonnes (MT), most of which is consumed locally. India ranks a distant second in garlic production with 3.27 MT in FY22, and like China, the major share goes for domestic consumption.

Indian garlic is different in quality than the Chinese variety and it is cheaper. China garlic is bigger in size, less pungent and has more colour. “Fresh Indian garlic prices are in the range of $450-$1,000 per tonne, depending on the size. China garlic is selling around $1,250 a tonne,’’ Hotwani said.

The clove size of the Chinese variety ranges from 40-50 mm, compared with 25-30 mm of the Indian variety. Chinese garlic is preferred by buyers in the US, Europe and West Asia. India’s exports are mostly to Malaysia, Thailand, Nepal and Vietnam.

Why is there a demand for Indian garlic now?

With the rise in prices of Chinese garlic, some West Asian countries, like Turkey, and African countries, have turned to India for purchases. Europe and the US are going for China garlic despite the high price. "But if the price rises to $1,500 per tonne, they may turn to India. Our garlic, produced in Himachal Pradesh, is similar in quality to China, with bigger cloves and higher prices. Maybe these countries should look at garlic from India,’’ Hotwani pointed out.

Last year, China cut down its shipments because of Covid-19 and for stocking up for domestic consumption in the wake of rising fuel costs. A significant share of garlic export from China is in the dried form of flakes. Shipments fell as high fuel costs forced China to impose curbs on drying garlic.

India’s export comprises more fresh garlic. But in the last few years, the demand for garlic flakes from India has surged. "Higher demand for Indian garlic flakes began in 2013 when prices of Chinese flakes escalated. In the last few years, several West Asian countries have been buying garlic flakes from India, apart from Far Eastern countries. Our flakes are 40 percent cheaper than Chinese garlic flakes,’’ said Murtuza Badami, MD of Murtuza Foods, a leading exporter of garlic flakes.

Higher incentives for garlic flakes

Higher incentives for garlic flakes have also aided export. According to a market report of the Olam group, a major global agri-products company, garlic planted acreage for CY23 in China is estimated to be lower than last year’s. This is driven by the slow demand for fresh garlic, weak market prices, and higher support prices for wheat as well as high inventories/carry forward from the last crop for both fresh garlic and dehydrated flakes.

Prices of garlic flakes saw an uptick in the run-up to the Chinese New Year, driven by the increased realisation of the reduced acreage as well as weakness in the US dollar.

Most of the carry-forward flake is in the hands of exporters, processors, or speculators, who could hold inventories for long periods and have been aggressively driving prices, the report added.

The Indian garlic production is also expected to be down by 20-25 percent because of untimely excess rains. The production is expected to range from 2.4 to 2.7 MT. “The arrivals have started. The shortage could drive up the local prices of garlic,” Badami said.