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Onion Market Update November 13, 2023
By John Harris
There has been quite a bit of change since the last time I reported. Going into Thanksgiving week, demand is as good as it has been in 6+ weeks. Daily shipment reports on the USDA Daily Market report back this up. Prices on yellows have reacted accordingly and have strengthened considerably in the last two weeks. I am hopeful this trend will continue into December, and that the market will get to an FOB of mostly $10.00. We aren’t there yet, but it’s trending. There are ample supplies currently, as it’s only November. However, there are several things to consider as we look ahead into 2024.
Canada: Canada has a short crop this year. There was a lot of rain during harvest, and a lot of product was left in the field. Canada should be buyers of onions earlier than usual – possibly January or February on yellows this year which will put a strain on U.S. supplies.
Mexico: Mexico has quite a water shortage this year. Acreage is going to be down considerably. I have heard as much as a third less than last year.
Netherlands: The Netherlands also has a short crop this year. We don’t talk about the Netherlands very often, especially on this update, but generally, they’re a pretty good-sized exporter into the U.S. However, with their short crop, the country may become an importer from the U.S. I’m not super familiar with this market, but this is certainly not a normal circumstance. Their government subsidizes freight costs to the U.S., and their onion imports put a strain on the U.S. markets. It doesn’t appear that this will be the case this year.
New York: New York also has a bit of a shorter crop this year than last due to the same harvest rain that Canada experienced.
Washington: Washington has a normal, average-sized crop. They had a good growing year and have a bit more size on their onions this year, which probably accounts for a bit more stocks on hand being reported from last year to this year. Quality in Washington has, overall, been very good thus far.
Idaho and Oregon: Eastern Idaho/Oregon in the Treasure Valley felt some effects of Hurricane Hilary in August. They got quite a bit of rain at the worst time. That concerns the amount of shrink this region will see as the season progresses. Stocks on hand probably don’t accurately reflect the amount of bags that will be packed and shipped out of that area this year. I know they are working diligently in that area to manage the storage sheds appropriately and to make sure that they are putting together the type of pack that people expect to receive.
So, where does this leave the 2023 onion crop? All signs point towards a strong onion market for later winter and spring of 2024. I wouldn’t be surprised as we get into late February-April if we see a $14-$15 yellow onion market. That’s nearly double what it is right now.
Meanwhile, the white market has been a bit unstable and weaker than it had been in the first six to eight weeks of the storage crop season. However, it is showing some signs again this week of strengthening again. The red market has stayed steady. I expect an upward trend in this market moving into the holidays and 2024. I think the red market has probably the most upside out of all three colors as we get into 2024.
As always, any feedback is much appreciated. Have a great week.
Editors Note: John Harris is the president and founder of Paradigm Fresh and Colorado Cold Connect in Fort Morgan, Colorado. He can be reached at John@paradigmfresh.com.
