It is still May, but in the onion trade it almost feels like June. Some of the sorting companies have already stopped for this season or are considering calling it a day in the short term. Sorters who do like it have a completely different strategy than those who want to keep it going as long as possible.
In recent weeks, onion prices have made great strides both at the grower and in the bale. Last week, it was already noticeable that a real step in the bale is not in the short term. This week, it is coming more from the grower's side, where a sense of reality is returning. Of course, there is still a group with free onions that are holding on to €50 or more. Growers who still have a few left, to put it irreverently, are a little less keen on the top price. Several traders report this week that they have bought 'the last few cars' from a grower for €42 or €43, for example.
On the sales side, there are big differences between sorting companies. Some have a limited work stock and do not want to enter the current grower prices again. They generally dare to ask firm prices (within limits) and are not sad if an order does not go through because of it. Sorters with a bit more stock are a bit more cautious and try to keep things moving. According to some, you should not want to let something bounce off now for half a cent and possibly lose a customer for the coming weeks.
Sorters who continue for a long time often still have the opportunity to play with the price because they generally did not buy at the top of the market. Most of them do not have much room for manoeuvre. Many sorters like to talk about how well they bought in January and February. This is often followed by a sentence with 'means', which in fact means something like: we also bought quite a few on the expensive side.
Consolidation
If there is to be another step in the bale price, the end of this month, beginning of June would be the most logical moment for that. For the time being, most sorters with fixed obligations have sufficient work in hand and by then it will probably be a bit clearer how the old and new harvests fit together.
The DCA bale price has seen the biggest increase for the time being. In fact, some packers are setting their prices slightly lower for next week to keep their customers. The range remains very wide. 'Zozo' triplets are for sale in the upper €30s, while 'palletwerk' supers are in the upper €50s. Both are not entirely representative of the market, however. For a nice coarse batch, an average bale price of around €46, €47 is feasible.
Read here is the explanation from DCA Market Intelligence on the new quotations.