Garlic exports from India are heading for a new high in FY24 after record export volumes in the previous year.
A global shortage of the spice, fuelled by reduced supply from China, the largest producer, has been driving up garlic export volumes from India.
China has a 75 percent share of the global garlic output, at over 23 million tonnes. India stands next, though with a much lower production of 3.3 million tonnes.
In FY23, a production shortfall of garlic in China led to record exports of garlic from India. But in the current year, exports are doing even better and are likely to touch a new peak. As per the latest Spices Board data, at 56,823 tonnes valued at Rs 277 crore for the period April–September 2023–24, exports were 110 percent higher in terms of quantity and 129 percent higher in terms of value over the same period of the previous year.
In FY23, garlic exports reached a new high of 57,346 tonnes valued at Rs 246 crore. In the past six months, while the quantity has inched close to the annual export volume last year, the value has already crossed last year’s level.
There was a 159 percent rise in quantity and a 32 percent increase in value year-on-year (YoY) in FY23. This was the first time garlic exports from India crossed the 50,000-tonne mark. The previous high was 47,000 tonnes in 2017–18.
Interestingly, this happened when the overall spice export volumes fell by 8 percent during the year, with heavyweights such as chilli, cumin, spice oleoresins, and mint products showing a decline in export quantities. Also, this was a period of high domestic and international prices of Indian garlic. International prices of Indian garlic are currently around $1,800 per tonne, compared to $1,350 per tonne of China, according to exporters.
Wholesale garlic prices are hovering around Rs 240 per kg, pushing retail prices to the range of Rs 260–265 per kg in the domestic market. "Prices reached this level in the last couple of weeks. As a result, offtake by shops has declined. This is the highest price so far. Prices had reached Rs 180 per kg two years ago,’’ said Sujesh, a wholesale garlic merchant in Kerala.
Garlic prices have escalated as the old stock is wearing thin and export demand is shooting up. Though the new crop in the next year is expected to be higher, rising demand could keep prices up. "We are expecting a crop of 3.6 to 3.75 million tonnes in place of 3.3 million tonnes in the last season,’’ said Vijay Hotwani, Managing Director of Varchasva Agro, an exporting firm based in Madhya Pradesh.
Sowing has increased by 30 percent for the next season. But higher production will depend on weather conditions, he said. Madhya Pradesh is the largest garlic-producing state, accounting for around 65 percent of the output. The other major producers are Rajasthan, Uttar Pradesh, and Gujarat.
Hotwani feels the current price trends will continue until the harvest in February-March. "After that, prices could slacken, which may boost exports. Our prices could fall to $900 per tonne next year, which could be below the garlic price in China,’’ he pointed out.
The global shortage has prompted several countries that are not traditional buyers of Indian garlic to turn to the country for the spice. Indian garlic is mostly preferred by Asian countries, such as Bangladesh, Malaysia, Thailand, Vietnam, and Nepal. But Latin American countries like Brazil raised their offtake from India last year. "They used to buy from China but have now shifted their focus to India,’’ Hotwani said.
Almost 70 percent of the garlic export output is in fresh form, while the rest mostly comprises flakes and granules, demand for which has been rising in recent times, especially from Western countries.
The US, Europe, and West Asia usually prefer Chinese garlic, which comes in bigger sizes, more colour, and less pungency. But some of these countries, particularly West Asian countries, the US, and Russia, are buying more Indian garlic flakes. "Indian garlic flake prices, which were hovering below Rs 100 per kg, have touched Rs 105 per kg now. However, demand has increased as there is no buffer stock in China. Production is just enough to meet the demand there,’’ said Murtuza Badami, MD, Murtuza Foods Pvt. Ltd.
A September market report by Olam Group, a major global agri-products company, points out that garlic planting for the 2023 crop in China was 15-20 percent lower than the previous year because of COVID-19 conditions, slow demand for fresh garlic, weak prices, and higher support prices for wheat.
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