Onion growers bracing for price pain as domestic oversupply looms | Ralph-Lauren

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Some of Australia’s largest onion growing regions are feeling nervous about a potential oversupply of the pantry staple.

About 37,000 tonnes of onions were exported last year, equating to 15 per cent of the national crop.

That was an enormous 100,000 tonnes less than 2019.

The main markets of Europe and South-East Asia continue to suffer extended lockdowns and a decline in international travellers, meaning they are taking even less of the crop.

The fallout is that all those onions are destined for the domestic market in a year where most states are harvesting bumper crops.

two hands hold out four onions ready for harvest in a paddock
Onions ready for harvest at a paddock in northern Tasmania.(ABC Rural: Laurissa Smith)

“Looking at our crops it looks like we’re going to be above our average yields,” said Tasmanian vegetable grower Cameron Moore.

“It looks like everyone else across the country has been the same.”

Australia’s largest production areas are in South Australia and Tasmania.

Mr Moore exports about 15 per cent of his crop from his Scottsdale farm in the state’s north.

“We’re a relatively small domestic market. We do rely heavily on exports,” he said.

Supermarket prices unchanged

Despite a drop in exports last year, onion prices remained fairly stable at the supermarket.

They continue to retail for around $3 per kilogram.

But panic buying at the start of the last year saw a large spike in the demand for onions.

a pile of onions in a supermarket
Supermarket demand for onions was extremely strong last year during the pandemic.(ABC News: Brian Hurst)

Onions Australia CEO Lechelle Earl said it helped move product that could not find a home overseas.

“We’ve also seen a rise in home cooks with more people using onions, which we think is fantastic.”

Ms Earl said sales through Melbourne last year did suffer during Victoria’s protracted lockdown.

With the reduction in the food service trade we saw a noticeable decrease in onion sales, through the markets predominantly,” she said.

Wholesale markets feeling the pinch

A year ago, growers received around $15 for a 10 kilogram bag of onions into Sydney and Melbourne. That price has now halved.

“If they’re cheap enough people will use a few extra onions,” Mr Moore said.

“But it’s not like stone fruit when they’re really cheap [and] people lap them up.

Several people stand in front of a conveyor belt sorting through onions inside a packing shed
Inside the Premium Fresh onion packing shed at Forth.(ABC Rural: Lachlan Bennett)

Onions Australia is now developing a strategy to find more international buyers.

“We’re working with Horticulture Innovation to develop emerging markets overseas including Vietnam and Myanmar,” Ms Earl said.

Thailand was the largest overseas buyer of Australian onions last year, followed by Taiwan, Belgium, the Netherlands, and the United Arab Emirates.

a man holds a couple of onions in front of timber bins filled with onions
Jim Ertler from Tasmanian vegetable processor Premium Fresh is tipping another drop in demand from some onion markets.(ABC Rural: Lachlan Bennett)

Tasmanian vegetable processor Premium Fresh exports close to 25 per cent of its crop.

Co-owner Jim Ertler said to avoid problems with shifting product, the business has taken a conservative approach to the season by cutting its onion production by about 10 per cent.

“Outside of the supermarkets the market is a bit weaker,” he said.

“We might look at deals that we normally would pass off … and move product while we can.”

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