Weak sales of small onions widen price differences

Customers for coarse onions and supers are present in ample numbers, but the weak demand for the smaller sizes is causing problems. That last point in particular is causing a lot of frustration in the market. Exports are running smoothly. Every week 20,000 tons cross the border and that is good for the time of year. Price formation, however, is lagging behind, making it difficult to make a margin. With the current supply, it is moreover difficult to meet the high quality requirements. Small and medium sizes are not, or hardly, sellable, it is said by various sorters. Stocks of these sizes are being cleared with great effort. That is accompanied by concessions on the price and that hurts, especially because it is already difficult to maintain margin when sorting onions. At the end of last year, onions were fixed for delivery in March and April at around 20 cents per kilo. Those volumes were limited, but they are now weighing on the result because the market is lower. Part of the purchase was covered in the sale, but that does not apply to all lots. Money has to be added there and new purchases have to absorb that. The problem lies mainly in the sales of medium sizes. Africa was the driving force behind exports through January, with strong demand for the 50-70 millimeter size. Many buyers have now switched to their own harvest. Demand for medium sizes from Africa is therefore limited. Moreover, some buyers are now specifically asking for larger onions. Morocco is full of Dutch onions Morocco provided a revival in recent weeks. Normally this country is not a regular buyer of Dutch onions, but a shortage in its own country led to extra import demand. Dutch exporters have responded fully to that. Meanwhile, this sales channel is full. Some exporters expect Morocco to return later to bridge the period until the end of May or beginning of June. Demand may then shift toward larger sizes. Brazil is also entering the market. It is still unclear whether business has already been done or whether it will remain at enquiries. The onions are relatively cheap, but transport is expensive. In addition, Brazilian buyers ask for coarse, white onions. It may be possible to combine that with smaller sizes, but that is uncertain. Hope for European demand for fine onions Sales of coarse onions are going well. For smaller onions, it remains to be seen whether European destinations will step forward. The bag prices of coarse onions and jumbo onions remain stable for now. In the sales of medium sizes, it is a matter of pushing and pulling. Prices vary widely, especially for the 40-60 millimeter size, which is sold at low prices. Some sorters indicate that they cannot sell this size temporarily, which puts extra pressure on the market. Within the range of medium sizes, bag prices vary from 10 to 19 cents per kilo. The lowest prices apply to poorer quality and the 40-60 millimeter size. The higher prices are for good lots in the 50-70 millimeter size, where uniformity and coarseness also play a role. Some sorters prefer to sell onions above 60 millimeters as 60-80 millimeters because of the price difference. Others are able to approach the price level of coarse onions with 50-70 millimeters. This increases the differences in sales. For trios, virtually the same applies as for the 40-60 size, although the supply of that is more limited.