Dried minced onion substitutes well for fresh onion in liquid-based recipes such as soups and stews. The dried onion reconstitutes as the dish cooks, although dried onions never provide quite the flavor rush of a freshly chopped one. You can also reconstitute dried onions before adding them to dishes such as meatloaf and tuna salad. Keep in mind that dried minced onions are usually made from pungent white onions, which have a sharper flavor than the red and yellow varieties.
Use between 1 and 2 tablespoons of dried minced onion for every 1/4 cup of fresh onion called for in a recipe. Reconstitute the onions before adding them to a dish by soaking them in water to cover for 10 to 15 minutes, or until they reach the desired texture. Add dried minced onions straight from the jar to recipes with a lot of liquid. Reconstituted onion never regains the crunch of fresh onion, so avoid using the dried version in uncooked dishes, such as salads, gazpacho or fresh salsa.
References and ResourcesHerbs, Spices and Condiments; Carol Ann Rinzler
The Cook's Thesaurus: Dry Onions and Shallots
Substituting Ingredients, 4E: The A to Z Kitchen Reference: Becky Sue Epstein