Weekly Product Updates

W14 Onion Update: Decreased Exports in Peru and Supply Storage in Brazil

Fresh Onion
Peru
Published Apr 12, 2024
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In W14 in the onion landscape, Peru's onion export volume and value in 2023 dropped by 14% and 2% YoY, respectively, due to decreased investment in cultivation caused by overproduction, container crisis, and rising freight costs. In addition, the onion harvest season in Adana, Turkey, has begun with reduced output due to mildew disease, leading to slightly higher prices. However, prices are expected to drop after Eid al-Fitr due to an anticipated abundant harvest. Furthermore, Brazil faces an onion shortage due to depleted stocks and unfavorable weather, resulting in increased imports from Argentina. The condition is expected to improve by mid-April due to favorable weather forecasts in the Northeast region. Lastly, India's Ministry of Commerce and Industry allowed an additional 10 thousand mt of onion exports to the UAE despite an ongoing ban on onion exports.

Peru's Onion Export Industry Faced Downturn in 2023

The onion export industry in Peru experienced a significant decline in 2023, with a 14% year-on-year (YoY) decrease in volume and a 2% YoY drop in value. The total export volume was 259.42 thousand metric tons (mt), worth USD 104 million. Despite a rise of 13% YoY in the average Free on Board (FOB) price per kilogram (kg) compared to 2022, the reduction in volume led to an overall decrease in exports. This downturn can be attributed to the 2020 container crisis, overproduction, and rising freight costs, which discouraged investment in onion cultivation. Ica remained the top onion-producing region, followed by La Libertad and Arequipa. The export market's landscape has shifted, with a decrease in shipments to Latin America, particularly Colombia, and an increase in European markets, where red onions were in high demand.

Onion Harvest Season Begins in Adana, Turkey

The onion harvest season has commenced in Adana, Turkey, which is a crucial period for early onion supply in the country. Currently, onions are sold at around USD 0.56 to USD 0.62/kg , with expectations of a price drop after Eid al-Fitr due to an anticipated abundant harvest. However, this year's yield has been impacted by mildew disease, leading to a reduced output of 20 to 30 metric tons (mt) per hectare (ha). There is hope for an increase in yield by 40 mt to 50 mt/ha post-holiday. The president of the Yüreğir Chamber of Agriculture has expressed optimism about future exports and farmer's profits. He expects a recovery from last year's financial losses due to restricted export opportunities.

Onion Storage in Brazil

Brazil faces an onion shortage due to a depletion of stocks in Ituporanga and Lebon Régis, Santa Catarina. As a result, the country has increased its imports from Argentina. However, these imports face delays at the Porto Xavier border due to strict sanitary inspections and a reduced workforce. Additionally, unfavorable weather conditions have resulted in declined onion yields in Irecê, Bahia, and the São Francisco Valley, which have affected both the volume and quality of the harvest. However, the situation is expected to improve by mid-April as favorable weather conditions are expected in the Northeast region.

India Allows Additional Onion Exports to UAE Despite Ban Extension

On April 4, 2024, India's Ministry of Commerce and Industry, acting through the Directorate General of Foreign Trade (DGFT), permitted the export of an additional 10 thousand mt of onions to the United Arab Emirates (UAE). This allowance is an exception to the ongoing ban on onion exports mandated by the Foreign Trade Policy 2023. Despite the ban, the amendment extends the quota for onion exports to the UAE. It's important to note that the government confirmed the ban extension through a notification on March 22, which prohibited the export of onions.

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