W8 Onion Update: Eastern Europe Sees Unexpected Onion Price Decline, Uzbekistan Records Record Vegetable Exports

Published Mar 1, 2024

In W8 in the onion landscape, onion prices in Eastern Europe witnessed a surprising downward trend, sparking concerns about the sustainability of this movement. Ukrainian onion prices notably decreased, influencing similar trends in other Eastern European markets, including a 5% average drop in Polish prices. Continued onion imports from Central Asia, particularly Uzbekistan, into Poland reportedly stimulated exports by offering transportation cost subsidies, contributing to increased supply in the region. Despite concerns about onion quality issues prompting farmers to lower prices, Uzbekistan saw record Jan-24 fruit and vegetable exports, with onions leading as the top export vegetable, generating significant revenue and reflecting a 2.2-fold YoY increase in exports.

Unexpected Decline in Eastern European Onion Prices Raises Questions about Sustainability

Contrary to expectations, onion prices in Eastern Europe experienced a downward trend in W8, raising concerns about the sustainability of this price movement. Following a sharp decrease in Ukrainian onion prices, similar trends were observed in other Eastern European markets. Despite a slight price stabilization, Ukrainian onion prices remain the lowest in the region, with a decrease of approximately 10% week-on-week (WoW) for good-quality onions and a more significant decline for those with quality issues. While experiencing downward pressure, Moldavian onion prices have not yet experienced significant drops. For the first time in 2024, Polish onion prices saw an average decrease of 5% WoW despite remaining the highest in the region.

Continued onion imports from Central Asia, primarily Uzbekistan, into the Polish market are believed to have stimulated exports by offering partial transportation cost subsidies. Interestingly, while wholesale prices in Uzbekistan remained largely unchanged, traders reportedly acquired cheaper onions directly from farmers. Ukraine's transformation from a major European onion buyer to a key supplier due to its rapid restoration of war-damaged vegetable production is contributing to increased supply in the region.

Concerns regarding onion quality issues in Ukraine, Poland, and even the Netherlands are prompting farmers to reduce prices and sell their products quickly. As high-quality onion stocks in storage dwindle, a price rebound could occur, as previously discussed in an earlier review of the European onion market. The prospects for onion prices in Central Asia appear less optimistic due to the anticipated record harvest commencing in a month. This potential increase in supply could further exert downward pressure on prices in the region.

Onions Drive Record Jan-24 Fruit and Vegetable Exports for Uzbekistan

Data released by the Statistics Agency of the Republic of Uzbekistan reveals a notable increase in fruit and vegetable exports during Jan-24 compared to the same period in 2023. Onions emerged as the leading export vegetable in Jan-24, with 54 thousand metric tons (mt) exported, generating revenue of USD 12.7 million, representing 20% of the total revenue earned from selling all agricultural products in the same month.

Total fruit and vegetable exports from Uzbekistan in Jan-24 reached 146.3 thousand mt, reflecting a 2.2-fold year-over-year (YoY) increase, equivalent to an additional 78.8 thousand mt. The total value of fruit and vegetable exports in Jan-24 reached USD 75.4 million, representing a 29.3% YoY increase. The primary export destinations for Uzbek fruit and vegetables included Russia (27.2%), Pakistan (21.2%), China (13.4%), and Kazakhstan (9.2%).