Global onion shortage

Record prices and shortfalls in production at the main sources: the general trend for this campaign

Virtually all the main onion producing countries in Europe have reduced their plantations. It is calculated that Spain has gone from 1,567 million tonnes to 1,198 million, whilst the Netherlands have dropped from 1,768 to 1,494 million tonnes. As a whole, the European harvest for this campaign will fall by 13.4%, going from 7,293 million tonnes to 6,314 million.

Spain

The Spanish productions have also been affected by the general situation of production cutbacks due to the drought. The water shortage has meant that the crop surface area has been reduced by 40% in Spain, one of the countries with the greatest specific weight in production of this vegetable.

During 2022, the price of onions led the rise in cost at source amongst all fruit and vegetables, with a rise of 238% owing to the increase in production costs, the reduction in hectares planted and the drop in yields due to the weather conditions.

In 2023, during week 15 of the year, onions reached 1.3 euros on the source market, a figure that has nothing to do with the 0.20 euros recorded on the same date of the previous year.

Spanish exporters expected to be able to cover their supply shortcomings with onions from New Zealand, but there have been important delays due to the cyclone that devastated the country’s main producing region. The volumes from Peru have also been smaller owing to the country’s socio-political problems. China, although it continues to export, does not cover the strong demand on the markets.

The Netherlands: the market is stabilising at high levels

In the Netherlands, the price has stabilised at around 90 cents for onions with a 60/80 calibre, whilst, in Germany, Spanish and Dutch onions are reaching much higher prices than in previous years, with a relatively high demand for imported onions.

The markets seem to have become reasonably stable. For a time, it seemed that price increases would have no limit, but in the end this has not been the case. The price of yellow onions is around 90 cents for a 60/80 calibre.

Moreover, there is some optimism regarding the seed onion season. The first ones will reach the market in mid-June and there has been a strong investment in them, therefore there could be some good business opportunities.

Germany: Record prices for onions

The demand for imported onions is relatively high, as last year’s production was quite limited. There is no doubt that the season will not be able to continue until July, as occurred last year. Rather, there is a plentiful offer of red onions, linked to the extension of surface area carried out last season. In the long term, ecological onions seem to be gaining ground in Germany. The cultivated surface area has almost doubled since 2018, according to information from the ecological market organisations, Naturland and Bioland. In spite of the high growing costs, many producers are showing interest in this type of production.

French demand has shot up

The lack of large sizes is making the demand for French onions shoot up. Owing to the hot weather at the beginning of the campaign and the lack of rainfall, it was predictable that there might be a shortage of large calibres this season.

The situation is so tight that although prices of small-sized onions usually drop, they are now being sold at almost the same price as the large ones. This lack of produce could cause an early end to the campaign at the end of the spring. Operators are already resorting to imported onions, which is contributing to the increase in prices. In spite of this drastic rise in price, consumption remains fluid.

The United Kingdom: Production has been reduced by almost a quarter

British onion production has been reduced by 100,000 tonnes. Normally, the country grows around 450,000 tonnes and consumes around 800,000 tonnes. Imported onions come from countries all over the world, although the Netherlands and Spain stand out. The shortage is not only due to the drought, but also to the fact that the plantations have been reduced by 8.5%.

Italy: Great demand and high prices for onion in Italy

There is an important demand for yellow onions, and imports to Italy have stopped. Germany and Austria are no longer exporting, the Netherlands only exports at high prices: 0.90 euros, before shipping costs, meaning that onions are arriving from Egypt at 0.900.97 euros, shipping included. White and red onions are recording less demand, but the prices continue to be high.

Yellow onions, with prices that are traditionally between 0.10 and 0.15 euros/kg lower than red and white onions, are reaching one euro per kilo. There is demand, because it is a highly consumed product, but the offer is limited.

According to data from the GfK Consumption Panel, 75.9% of Italian households buy onions. In the twelve-month period up to January 2023, the number of purchase operations and the amount paid remained stable. On the other hand, the volume has been reducing. Slightly over 2.2 million Italian households purchased ecological onions. Frozen onions registered a considerable growth, going from 1.4 to over 1.7 million purchasing households over the past year.

Egypt

Egypt is another of the global agents in the onion world that has also recorded a rise in prices, almost 80% in the price of spring onions, although this has not meant any extra profit for the producers, as costs in Egypt have also increased. Additionally, many crops have been affected by the bad weather conditions.

New Zealand as a supplier

The onion harvest from New Zealand has been affected by cyclones, which have caused serious damage and have meant a considerable reduction in the country’s production.

In view of the world-wide shortage, some producing regions have imposed cuts on exports to protect their local markets. There have been restrictions in South America and Central America, in Pakistan and, recently, also in Morocco.