It was a turbulent week in the onion sector. Growers are working overtime to get the onions in on time, the yields are variable and in the meantime Senegal is introducing an import quota. What effects does that have? Subscribe to 'Onion Market'.
These are busy times for onion growers. After the wet period of the previous weeks, it had to happen this week. We have worked hard to get the onions off the land. The revenues vary greatly; from 25 tons in areas in Zeeuws-Vlaanderen to 100 tons in the north of the Netherlands. The yields are particularly disappointing in certain strips of Zeeuws-Vlaanderen.
Because a lot of bacteria and thrip damage was found, the onions hardly had a chance to grow. The further north one goes, the better the yields. In Flevoland the yields vary from 65 to 75 tons. The most positive stories come from Groningen. There the yields have a bottom of 75 tons. Yields of 100 tons are no exception.
Senegal introduces import quota
On Thursday, September 28, it became clear that Senegal, the largest buyer of Dutch onions, has imposed an import quota. The Agence de Régulation des Marchés (AFM) agency sets this up for the period from September 1, 2017 to December 1, 2017 and covers a volume of 65.000 tons of onions. It is expected that 25.000 tons of onions will be shipped in the first weeks of September Senegal have been exported. This would mean that there are still 40.000 tons left.
In 2016, 1 tons of onions were exported to Senegal from September 1 to December 89.500. This means that last year during the months of September to December at least 24.500 more tons of onions were exported to Senegal than is now possible with the set quota.
Does this mean that much fewer onions will go to Senegal this year? That remains to be seen. In the first weeks of the 2017/2018 season, more than 42.000 tons of onions have already been shipped to Senegal. If we add the quota to this, this would mean that 1 tons of onions could have been exported to Senegal on December 107.000.
If we extend this even further and maintain sales that are the same as last year (from December 1 to the end of the season), the 2017/2018 season will amount to 164.000 tons. This is 6.000 tons less than the 2016/2017 season, in which 170.000 tons of onions were exported to Senegal.
What does the import quota mean for onion prices?
If the export figures of onions to Senegal from December 1 follow the same course as those of last year, then the total export to Senegal will be slightly less than last year. However, the quota will put pressure on exports to the most important buyer of Dutch onions in the next 2 months. This puts slight price pressure on the middle grade, of which Africa is a major buyer. In the bale price, this means that the price range drops from roughly €12 to €13 to €11 to €12.
The quotation on the Emmeloord stock exchange shows a decline in the middle grading of onions from the field. The 30-60% coarse grading decreased by an average of €0,50 to €5 to €6 per 100 kilos. Furthermore, few transactions were made this week. Just like last week, Emmeloord recorded a calm mood, while Middenmeer described the mood as dull.
Sorters and exporters expect that there will remain slight pressure on medium-grade onions. The coming weeks will provide more clarity about the consequences of Senegal's import quota.