The growers are firmly in control of the onion market and are not planning to change course for the time being. Traders and sorters are less sure of their business. The export is going very well, but we do not (yet) have the 40.000 tons plus weeks. Meanwhile, the bale price is struggling to keep up with grower prices.
On average, onion prices at the regional fairs increased this week. In time for delivery in December or January, the price is now around €35 per 100 kilos. According to traders, it is simply not easy to get good, large onions. "Farmers with good onions mention the price and it is hardly negotiable," according to a trader. The relatively high onion prices are an additional risk, some insiders warn. As a trader, sorter or exporter you have a lot of money on the go. You must be able to pre-finance this.
At odds
To stay in line with grower prices, the bale price would have to make a significant step. That's not working well at the moment. The large processing capacity works to the disadvantage of the sorting companies. Sorters need onions to keep working and running the lines at half capacity in the first half of the season feels counterintuitive. Now that the working stock is decreasing, the choice is to buy relatively expensive onions and 'mix' them with those already purchased to keep the average price under control, or wait patiently in the expectation that the bale price will increase in the coming weeks. Several players seem to choose the first option. According to some insiders, there is considerable competition between sorters for the available orders.
The DCA quotation for the bale price of onions This week remains virtually the same as last week. A good batch with 60% coarse, sorted, averages out to approximately €34 to €35 per 100 kilos. You can still get by with the daily price on the farm of €29 or €30, but the amounts paid for business in December are almost equal to the current bale price. Some traders are looking at this with amazement. The fact that the ratio between the grower and bale price is not appropriate has happened more than once this season. However, so far we have still managed to get the bale price with some delay.