According to market sources, the Middle East conflict is weighing on Indian onion prices, as exports to the Gulf have dropped by nearly 45%. About 350 containers were reportedly shipped in March this year, compared with 600 in March 2025, as reported by FreshPlaza.
The US and Israeli military action in Iran has driven widespread disruption to regional logistics. Insurance costs for shipping in the Gulf have soared, and market sources report that container rates for Gulf exports have increased exponentially.
In addition to cost challenges, the situation has created a market opportunity for competitors such as Yemen and Egypt, who are able to access the region at lower rates via road, suppressing demand for Indian products.
With an excess of supply in the domestic market, the Indian Onion wholesale price stood at INR 1,880.77/kg ($20.19) on April 13, down by 5.9% month-over-month and 21% year-over-year.
Market participants state that the very high level of supply is pushing prices to below production costs, and industry representatives are calling for government intervention to support farmers, who remain under financial strain.
In the meantime, sources state that the success of the recently announced ceasefire, and a hoped-for normalization of shipping, remain key watch-out factors. If exports can resume, sources expect the downtrend to reverse.
Written by Craig Elliott
