Recovery after unexpected demand from Brazil
As if Arsenal is three-nil behind in the quarter finales of the Europa League, and only has ten play…As if Arsenal is three-nil behind in the quarter finales of the Europa League, and only has ten players left, yet they make the winning goal in the extra time. That’s how unexpectedly Brazil entered the onion market last week. “This is why people always say: ‘they’re still onions,’ this is what we’re doing it for. No one still expected it, but Brazil started demanding serious volumes,” says Lindert Moerdijk from MSP Onions.
Brazilian demand failing to occur was one of the reasons for the difficult onion market so far. Last year, 94,000 tonnes of onions had been shipped to the South American country before the end of March. Because of that, Brazil was the second buyer of Dutch onions after Senegal. This season, export remains limited to 7,000 tonnes until week 13.
“The new harvest is expected later in Brazil, so they now have a gap, and because of the attractive prices we are an interesting supplier,” the exporter continues. “The onion market looks completely different right away. Africa will have to start loading before the Ramadan, stocks in Europe will deplete and demand will start recovering, and with the broken weeks to come, we have some ingredients that will allow the Dutch onion sector to show its character.”
An important point of attention is that it’s a challenge to send good batches. “The coming month will be an important test for the Dutch onion sector to keep its reputation up. We are already late in the season, and it’s impossible to send onions with internal quality problems. These problem batches can’t even be sent to Africa, let alone to Brazil.”
“Of course, both farmers and packers see plenty of action, and prices immediately react to that. Hopefully, this will result in money so that the grower can profit somewhat, because two times zero equals zero,” Lindert says. “But it’s nice, because the sums will be a bit different because of this. It’s very interesting to see what the stocks actually are. I personally think that more onions were shipped in recent weeks than people assumed.”