Indian Grape Export in 2019: Analysis of Production, Variety, Competition, and Price

Contributed by Laxman Savalkar (Director) 

Indian Grape Production

In 2019, India has experienced poor weather conditions such as drought during the first half of 2019 and floods during the rainy season. To cope with poor weather conditions, grape producers have used more pesticides in 2019, which could affect grape qualities. This can also have a negative effect on European exports: German importers and retailers have stringent requirements for pesticide residues: they do not accept more than 5 number of pesticide molecules in grapes. 

Due to the adverse weather conditions, the overall production volume of Indian grapes in 2020 is expected to be slightly lower compared to the last couple of seasons. Due to cloudy weather and rain in September 2019, grape pruning was delayed, resulting in lower yields. The lower production volume is not expected to significantly affect overall exports as India only exports around 8% of grapes produced in the country.

Indian Grape Varieties

MGE Farms, an Indian grape exporting company, produces and exports five varieties of grapes: Thompson, Sharad, Sonaka, Flame, and Jumbo varieties. The Thompson variety has a more uniform quality in terms of shape and taste compared to other varieties. It is also the most popular and cheapest variety. The Sharad, Sonaka, and Flame varieties are between 10% and 20% more expensive compared to the Thompson variety. The Jumbo variety, which was introduced to the market 5~6 years ago, is the most expensive variety: it is around 45% more expensive than the Thompson variety. 

Competition in the Global Market and Grape Prices

Indian grapes are known for their competitive prices. In the European markets, Indian grapes have the most competitive price: on average, Indian Thompsons are around 0.40-0.50 USD per kg cheaper than Thompson grapes from South Africa and Chile.

In the global market, Indian grapes only directly compete with Chilean grapes. Usually, other major grape exporting countries such as South Africa and Egypt do not directly compete with Indian grapes due to different seasonalities. However, in 2019, Indian grapes competed with South African grapes, as the South African season was delayed and thus overlapped with the Indian season. The Chilean season also started earlier than usual, causing further overlaps with the Indian and the South African seasons.

The overlapping of the South African, Indian, and the Chilean grape seasons led to a surplus of grapes in the global market in 2019. As a result, the global average grape price was 10%~15% lower between February and May 2019, compared to the same period in 2018.

Egypt is a competitive grape supplier in the European market. Due to proximity, Egyptian grape exporters can send their grapes to the European markets within a week. As a result, Egyptian grapes are known for high quality and freshness in the European market. The grape season in Egypt is between May and September, so usually, the Egyptian season does not overlap with the Indian season. However, if the Egyptian season starts earlier and overlaps with the end of the Indian season in April, then “Indian exporters often choose to end their season early because competing with the Egyptian grapes in the European market is difficult,” states Laxman Savalkar, a director at MGE Farms. 

Indian Grape Market Prospects

The Netherlands is the largest importer of Indian grapes, followed by Russia, the UK, Germany, and the UAE. In the 2018/19 grape season, Indian grape exports reached a record volume of around 215K tons, of which around 30% was sent to the Netherlands.

Southeast Asian countries such as Malaysia and Indonesia show promising potential for Indian exporters. Previously, Malaysian and Indonesian importers have imported grapes through the trading hub of Hong Kong. However, MGE Farms reports that in 2019, Malaysian and Indonesian importers have reached out to the company to import Indian grapes directly.