The market has to process a record yield of 1,6 million seed onions this year. Is there a destination for this large onion mountain?
The figures from Statistics Netherlands this year don't lie. The expected gross yield of seed onions is almost 20% higher than last year. The provisional harvest estimate assumes an average yield of 52,2 tons of seed onions per hectare. According to Marco van Soesbergen, cultivation specialist at CAV Agrotheek, that is a solid forecast. "I wonder whether that yield will be achieved. Of course it is an average, but I don't see any real top yields this year. It was not an optimal growing season, which is actually reflected in all crops."
Van Soesbergen emphasizes that there were indeed good onion plots. "But," he says, "I mainly see plots that are extremely disappointing. Quite a few onion plots have been stranded due to downy mildew. In our region, North Holland, there were also locations with heavy rainfall, which caused plant failure." The turbulent growing season also ensures variable quality. All things that, according to Van Soesbergen, do not indicate a top harvest. "Compared to last year, the yield may be high, but I would rather say average."
Major differences due to growing season
However, it was already known that the area showed a growth of 10,5% this year. A solid starting position for a record harvest. It is also clear that the differences are large this year. There are significant deviations not only between regions, but also within cultivation areas and even at plot level. That is the result of a changeable growing season. It therefore explains the fact that some growers recognize themselves better in the CBS harvest estimate than others.
The figures were by no means a surprise for Wim Waterman of the Flevoland export company Waterman Onions. "The figures have already been tested in the market. It remains to be seen whether they are exactly correct, but the fact is that there are enough onions this year." Yet Waterman does not find this very shocking. "It is not about how big the supply is, but how much is going away. And that is good. The market is not faltering; there is sufficient demand from the usual sales markets. Our biggest challenge is logistics. The high container rates and limited availability of containers and trucks are serious obstacles."
Harvest estimates accentuate the mood in the market
The exporter notes that the current mood in the onion market is quite negative. "That was already the case at the beginning of the season, which caused a price dip. Fortunately, this improved as exports progressed and things got going. The negative mood is now somewhat accentuated, partly due to the provisional harvest estimate." Yet Aquarius remains optimistic. According to him, getting rid of the onion mountain is always possible.
Eric Moerdijk of the Zeeland onion processing company Monie Nieuwland is slightly more reserved. "Last year, a record of almost 1,2 million tons was exported. We see exports expanding slightly every year, especially to Africa. At the same time, harvest estimates this year across Europe are considerably higher than last year. It will be quite a challenge to to get rid of everything. Sales are more difficult, especially in the second half of the season. Nothing is impossible, but we have to be realistic."
More supply creates price pressure
This means that the pressure on onion prices for growers is currently increasing. Moerdijk notices that the CBS figures are taken seriously and that the supply from growers is becoming increasingly available. "This is also because the quality and shelf life are not great everywhere. If this continues, I do not expect the price to increase any further. Or an export destination will suddenly have to be added, such as last year with India, but I do not expect that ."
According to Moerdijk, the fact that price developments among growers are still quite weak is a sign that there is sufficient supply. CAV advisor Van Soesbergen agrees that the mood in the market is not good, but does not describe it as very bad either. "Growers can still sell their onions. Most of them are waiting patiently and are not worried yet."