Things seemed to go wrong at the onion market two and a half weeks ago when the bale price was €32. There is nothing left of the doubt that gripped the market at that time. Growers, sorters and exporters exude self-confidence. That may also be the major shortcoming of the current market.
Sorters are quick to respond this season and are wary of large work inventories. With relatively high prices and the necessary quality problems, there is something to be said for this. If demand picks up, processors must immediately go to the farmer to secure the required onions. Various growers also know how the hares run, a few sorters try to outdo each other and before you know it, prices are rising rapidly. Last week, €40 was still commonplace on March/April, but now the farmer is paying €40 directly and €50 for April, with an occasional upward trend. Of course, we are talking about good onions that can be stored and we are not talking about large volumes. If they have to go immediately or if they are industrial quality, then we are talking about significantly lower prices.
Economical on customers
It remains to be seen how durable the current rally is. Africa is expected to remain on the market for the next two weeks and it does not look like there will be a turnaround. After that, the prospects are less predictable. Various sorters and exporters are a bit worried that things are going very crazy now. That deters potential customers and we need them in the longer term given the one-sided demand. If demand drops slightly, which is not unusual in January, the mood can just as easily turn negative.
De DCA quotation Bale price of Onions has made a leap this week. Averaged over the entire week and all sizes, the bale price is in the late €40 range. Price differences between the sizes are relatively small. Triples and mediums are almost the same price and for coarse and supers it takes effort to actually make something extra.