Indian gherkin producers are struggling to match demand from the West, where consumption of the pickled cucumber has surged even as supply from Ukraine and other parts of Europe has decreased.
‘This is a seller’s market. ‘Demand has increased, and we are unable to match it since supply is low and inventories have depleted,’ said Pradeep Pooviah, vice president of the Indian Gherkin Exporters Association. He estimates that the demand-supply gap is approximately 20%.
Pricing has been improved
According to Pooviah, the supply shortage has resulted in improved prices even as exporters-producers struggle to meet the order backlog. ‘We’re attempting to accommodate the demand that has built up over the last four months,’ he added.
Gherkins are little cucumbers grown by farmers in southern India that are processed and exported in brine solution by exporters to international markets in the West where they are consumed as pickles.
Gherkins are grown using the contract farming approach, with exporters deciding on the quantity depending on predicted demand. Gherkin farming is projected to cover 60,000 acres in states such as Karnataka, Tamil Nadu, and Andhra Pradesh. Close to a lakh farmers are involved in the production of gherkins, which are mostly exported to markets in the United States, Russia, and Europe, among other places.
The present gherkin supply gap is linked to exporters cutting output, which operated at roughly 60% capacity. Exporters faced obstacles such as reduced pricing and greater logistics costs in the preceding year, affecting realizations and profitability.
‘We produced around 40% less from April to December, which helped reduce market inventory,’ Pooviah added. In addition, farmer prices increased little, resulting in lesser output. He stated that manufacturing is now returning to normal and that there is a backlog to be serviced.
According to sources, the reduced supply from war-torn Ukraine and drought-stricken Europe has also contributed to the rising demand for Indian gherkins. Unlike other manufacturers such as Ukraine and Mexico, India exports gherkins all year, whereas production occurs only around nine months of the year.
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In the fiscal year ending March 2022, India’s gherkin exports declined by around 11% in value terms to $199.46 million, down from $223.04 million the previous year. Exports were 2.175 lakh tonnes, down from 2.235 lakh tonnes the previous year.
Exports of processed vegetables, which include gherkins, are up $325 million in the current fiscal year compared to $275 million in the same period last year.