At the start of this week, the Zuid stock exchange was still trading at 18 cents at the top of the yellow seed onion price. Some trading was done last week, but that's currently out of the question. What trading is still taking place is concentrated at a level of 16 to 17 cents per kilo.
The grower's price has dropped slightly because few onions are being purchased, while there's still plenty of supply from growers eager to do business before Christmas. Sorters and packers have already made their purchases and therefore don't need to buy many onions from farmers for the time being. They're therefore taking a wait-and-see approach and will only act if a supplier offers a price that suits them. And in this situation, the prices being paid aren't the best.
Buyers' reluctance is exacerbated by a dip in sales. West Africa has become oversupplied due to the enormous export volume, and these quantities first need to be reasonably absorbed by the local market, so that there's room for fresh onions again. Some exporters say that prices in Africa are currently lower than in the Netherlands. That's not a good sign, especially at a time when most of the shopping is being done for Christmas.
Despite the enormous quantities already exported to Africa, almost everyone expected the flow to continue until just before Christmas. And that prices would gradually rise. Just before the normally busiest period, the situation suddenly seems to be faltering. Bale prices aren't going down to 26 or 27 cents; they're actually falling slightly.
In this declining market, buyers are suddenly pulling out. Although prices aren't high, there are risks. According to exporters, importers and local traders in Africa are now taking a premium. And they're obviously not happy about that. So, the brakes are being applied. Orders are being postponed, causing sales here to stagnate somewhat.
Bought little
The slowdown in sales has directly impacted purchasing needs. Buyers are being slowed down to wait and see how sales will go. Consequently, few are being purchased, even though there is still supply. This is putting pressure on prices, causing grower prices to drop to around 16 to 17 cents. The regional exchange in Emmeloord lowered the price of large onions by half a cent to one cent, to 15 to 17 cents per kilo. The market sentiment is being described as subdued.
A few exporters are claiming that absolutely nothing is happening at the moment. Another is more optimistic and sees the market slowly recovering after a weak week. One is more nervous and is quickly lowering prices to maintain sales volume as much as possible, while another is trying to keep prices stable because, at the moment, even with lower prices, no additional kilos are being sold.