W16 Onion Update: Uzbekistan's Onion Prices Plummet to Historic Lows in 2024 and Flood Damage Spurs Shallot Price Surge in Cirebon City, Indonesia

Uzbekistan's Onion Prices Reach Historic Lows in 2024

The wholesale price for onions in Uzbekistan dropped to USD 0.12 per kilogram (UZS 1,500/kg), the lowest recorded during this period. This represents a significant decrease from prices a year ago, which were 4.4 times higher. Farmers and traders who bought onions in the fall for resale in the spring are facing near-zero prices, with estimates suggesting that 150 to 200 thousand tons of onions in Uzbekistan may need to be discarded or used for livestock feed. This oversupply issue is not limited to Uzbekistan. It also affects Kazakhstan and Kyrgyzstan. The lack of elasticity in onion demand means that price changes do not significantly alter consumption patterns, leading to standard price collapses in the onion market.

Romanian Cooperative to Invest in Onion Storage Facilities

The Romanian agricultural cooperative plans to invest USD 8.5 million (EUR 8 million) in onion storage and drying facilities to capitalize on the price difference between overproduction periods and spring, when Romania imports onions from the Netherlands. Romania currently produces 30% to 40% of the onions it consumes, but it lacks the necessary storage infrastructure, including ventilation chambers, for long-term storage. As a result, Romania imports more than 80 tons of onions annually from the Netherlands and other European Union (EU) countries, with an additional 2 thousand tons arriving monthly from Ukraine. While Romania's annual onion production exceeds 300 thousand tons, inadequate storage facilities mean a significant portion of the harvest never reaches the market.

Kazakhstan Grapples with Onion Surplus and Export Hurdles

The onion market faces significant challenges as farmers in Kazakhstan grapple with oversupply and logistical hurdles. Despite a surge in onion production, unsold stocks totaling 130 thousand tons remain, prompting concerns. The situation is compounded by imports of early-ripening onions from Tajikistan, exacerbating market pressures. Kazakhstan's Ministry of Agriculture attributes the surplus to expanded planting areas driven by last year's price increases. However, a subsequent ban on onion exports has hindered farmers' ability to sell their surplus. Efforts to find alternative markets have seen limited success, with 23 thousand tons shipped to various countries. Logistic difficulties, including transport permit requirements, have further hindered export efforts, though recent regulatory changes aim to streamline the process.

India Extends Onion Export Ban but Allows Limited Exports to UAE and Sri Lanka

India has extended its ban on onion exports indefinitely but has allowed limited exports to the United Arab Emirates (UAE) and Sri Lanka, following a similar concession to Bangladesh. To further stabilize domestic onion prices, India has imposed a 40% export duty until the end of 2023 and set a Minimum Export Price of USD 800 per metric ton (mt). However, Bangalore rose onion exports are exempt from this duty with proper certification. The government is also releasing onions from its increased buffer stock for the 2023/24 season to help stabilize prices. These measures indicate a strategic approach to balancing domestic market stability and international trade relations.

Flood Damage Drives Shallot Prices Up in Cirebon City, Indonesia

After the Eid holiday, the price of shallots in Cirebon City, West Java, has increased from USD 1.23/kg to USD 3.39/kg (IDR 20,000 to IDR 55,000/kg). This surge is mainly due to crop damage caused by floods in key producing areas such as Brebes, Losari, and Demak. Local traders have had to source shallots from alternative places like Pekalongan and Pemalang, but only in limited volumes. This scarcity has increased prices in the Jagasatru Main Market and other traditional markets.