Either the trees reach into the sky or there are dark clouds hanging over the onion market. There doesn't seem to be a middle ground. At the beginning of this month, several traders expected the season to fizzle out. Last week there was a revival and the penny was flying around. That euphoria has now subsided considerably.
The 2023/24 onion season cannot be called boring. Things are not going as many growers and sorters expected or hoped. "That keeps it exciting, it's just a shame that it costs so much money if you're wrong," said an insider. Enthusiasm to continue with Dutch onions until well into June is waning among sorters. The increase in the onion price at the grower was motivated more by speculation than by increasing demand, it seems. In order to cope with more expensive onions, the bale price would also have to increase. That just won't work very well. If you set something up, you will easily lose the customer to your competitors, say various sorters.
Value for money. This certainly also applies to onions. Some sorters switch to cheaper onions from the grower and spend more time making them and try to maintain margins. However, it is rarely possible to turn them into a top product and these onions are often marketed more competitively. Some customers are sensitive to this and try something. If the onions are disappointing, they often return with hanging legs. Switching buyers does not do any good to the confidence of sorters. It makes it very difficult to estimate what you still have a market for this season.
Stock Location
Another price-pressing factor is the stock of onions that is still hanging above the market. The good onions will come up, but what's underneath them can sometimes become a problem. Some sorters predicted a few months ago that if we dropped the price far enough, demand would naturally pick up enough to get rid of everything quickly. This turns out to be different in practice. The demand is certainly not bad, but people are not buying many more onions compared to the multi-year average because they are cheap. What also doesn't help is that there appear to be more onions in Germany than previously thought.
De DCA quotation Bale price of Onions remains largely unchanged. Sorters try to charge extra at the top quality, but buyers do not want to go along with that. The bottom of the market shows little change.
Read here is the explanation from DCA Market Intelligence on the new quotations.