The Tamil Nadu Agricultural University’s (TNAU) Domestic and Export Market Intelligence Cell (DEMIC) has projected that farm-gate prices for good-quality small onions (shallots) will range between ₹30 and ₹35 per kilogram during the upcoming harvest season, according to a press release from the university. The forecast is based on an analysis of 15 years of price data from the Dindigul market, combined with a market survey conducted by DEMIC at the Centre for Agricultural and Rural Development Studies (CARDS), TNAU.
Supply and Production Landscape
India is the world’s leading producer of small onions, with cultivation concentrated in the southern states of Tamil Nadu, Karnataka, and Andhra Pradesh, as reported by TNAU. In Tamil Nadu alone, small onions account for nearly 80% of the state’s total onion production. During the 2024-25 season, the crop was cultivated over 0.44 lakh hectares (44,000 hectares), yielding 5.28 lakh tonnes (528,000 tonnes) at an average productivity of 12 tonnes per hectare. Major producing districts in Tamil Nadu include Dindigul, Tiruppur, Perambalur, Tiruchirappalli, Namakkal, Theni, and Madurai.
Fresh arrivals from Perambalur, Dharapuram, Palladam, Udumalpet, and parts of Karnataka are currently flooding the major wholesale markets in Tiruchirappalli and Dindigul, according to trade sources. This influx is a key factor influencing the near-term price outlook.
Demand and Export Dynamics
Domestic demand for small onions is largely met through production within Tamil Nadu and supplemental supplies from Karnataka and Andhra Pradesh. However, Tamil Nadu also serves as a key export hub, catering to markets in Sri Lanka, Bangladesh, Malaysia, and Nepal. Trade sources indicate that export demand has remained robust this season, with overseas shipments accounting for an estimated 5-10% of total small onion production.
| Metric | Value |
|---|---|
| Cultivated area (2024-25) | 0.44 lakh hectares |
| Total production (2024-25) | 5.28 lakh tonnes |
| Average productivity | 12 tonnes/hectare |
| Export share of production | 5-10% |
TNAU’s price forecast is specifically for good-quality small onions at the farm gate. The analysis leverages long-term pricing trends from the Dindigul market, which is a major price reference point for the region.
Farmer Advisory and Implications
Based on its price outlook, TNAU has advised farmers to incorporate the projected harvest prices—₹30-35 per kg—into their sowing decisions for the coming season. This guidance is intended to help producers align planting with expected market realizations.
For commodity traders and procurement teams, the forecast signals a relatively stable price band for the upcoming harvest window. The robust export demand, coupled with strong domestic consumption, supports the lower end of the range. However, the current influx of fresh arrivals from multiple districts and parts of Karnataka could exert near-term pressure on wholesale prices. Traders should monitor arrivals at the Dindigul and Tiruchirappalli markets closely, as these are key price-discovery hubs. The 15-year data-backed forecast from TNAU’s DEMIC provides a credible baseline for procurement planning and inventory management.
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