Will onion exports to Brazil continue?

Brazil is a huge country; both in terms of inhabitants and surface area. With 207 million inhabitants, the consumption demand is enormous. Brazil also grows onions itself, with which it wants to largely meet that need.

Different growing areas
Onions are grown in different growing areas. With an area covering almost 85% of the surface of Europe, the areas must be viewed separately. If the harvest in one growing area is disappointing, it says little about the other areas. This is also how it works in the Netherlands and Spain. If the harvest in the Netherlands is disappointing, this says nothing about the harvest in Spain.

Brazil is not self-sufficient in its onion cultivation and if, like this year, there is a poor harvest in one of the growing areas, the country will enter the world market. The Netherlands hopes to respond to this.

Heavy competition
The Netherlands is not the only country that wants to fill the onion shortages in Brazil. Normally the Netherlands is third in line. Argentina is the largest exporter of onions to Brazil, followed by Spain.

The Netherlands is primarily a country that fills in the gaps. One year there will be major deficits and the next year the country will barely report. These vagaries are difficult to predict and it is also difficult to estimate how many onions are available on the Brazilian market itself. This makes the country a difficult market to predict.

Filling gaps
Last season, Brazil was missed for a long time, until it suddenly came with a large amount of demand in mid-April. In weeks 16 to 19, Brazil had an onion shortage and was knocking on the door of Dutch exporters. In 4 weeks, 17.923 tons of onions were exported, which accounted for 60% of the export volume of the 2016/2017 season. It indicates that Brazil is a difficult sales market, but that things can suddenly go very fast.

This year there has been demand for Dutch onions from Brazil for about 2 months, but the market is not really taking off. Onions are loaded for Brazil from week 3, culminating in sales of 1.490 tons of onions in week 6 (provisional export figures).

(Text continues below the chart)The above figures indicate how volatile the Brazilian onion market is. 

Opportunities for the Netherlands?
When Brazil needs more onions, there may be opportunities for the Netherlands. There are fewer onions in Argentina than last year and there have been quality problems. There are few large onions available in Spain, in fact they buy large onions in the Netherlands.

The Netherlands must then be able to meet Brazil's quality requirements. The color of the onions should be at the top. In addition, the onions must be coarse. The majority of onions exported to Brazil have a March size between 60 and 80 millimeters. In Brazil, onions are strictly controlled. If the color, size or quality is disappointing, a correction will quickly follow.  

For the time being, exports to Brazil are not continuing. However, if the gaps in the Brazilian market widen, the Netherlands will be in a good starting position. Last season proved that things can go very quickly in a short period of time.Brazil has 207 million inhabitants and is 207 times the size of the Netherlands (8.516.000 km2).