Overview of the Indonesian Onion Market

Published 2021년 8월 26일

Indonesia is one of the top global onion markets, and the country increased its import volume by 13.7% in 2020, compared to the previous year. During 2015-2020, Indonesia’s onion imports have grown by 22% in value and 45% in volume. The major suppliers of onions to Indonesia in 2020 were New Zealand, India, the Netherlands, and China.

Tridge interviewed Vineet Rathore, the Marketing Manager of PT. Kore Projects Indonesia, to gain insight into the market.

Rising Chinese freight costs set to limit onion imports

According to Rathore, increasing freight costs from Chinese vessels could detract buyers from purchasing from the Asian nation, with importers preferring to source from India. Indonesian onion imports from China have dropped, in value, by -58.95%, and in quantity, by -30.64%, over the past year.

“Indonesia is an import market. Most of the country’s onions are imported from China and India. Australia is too far for Indonesia to import. Currently, my firm is only importing from India. Chinese freight costs have gone up significantly. This is a major deterrent as we seek to control our costs and increase profits. The shipping industry is quite ruthless. Onion prices have increased due to the global rise in shipping costs, which have surged by about 50%. As a result, we prefer importing from India, where shipping costs are lower,” stated Rathore.

New Zealand's onion exports to Indonesia on the rise

Indonesian onion imports from New Zealand increased, in value, by 2.13% compared to 2019 and by 100.81% over five years, from 2015 to 2020. Currently, due to limited supply and the subsequent rise in prices, Indonesia has adjusted its import regulations to the benefit of New Zealand. As a result, Indonesia has temporarily removed the licensing requirements for imports, which allows onions to enter the country more easily. An increase occurred in April where Indonesia's demand for New Zealand onions surged to USD 7.54M, compared to USD 3.89M during the same period in the previous season.

Indian onion varieties preferred

According to Rathore, most Indonesian consumers prefer red and pinkish onion varieties from India for household use, with the white Chinese onions used in restaurants.

“Indonesian consumers prefer large-sized onions, with sizes of 45-50mm. Red and pinkish onions are popular in households because of their taste. White onions are sourced mainly from China. The Bawang bombei is the one that we procure from China, and these are mostly sold to restaurants.”