Onion volume looks steady - The Packer

Onion volume looks steady

11/04/2011 09:46:00 AM
Ashley Bentley

As fall onion harvest concludes in multiple growing regions, onion shippers hope supplies are just right to firm a weak market.

Weather in eastern Idaho was a little milder than the cold setting in on the western side of the state in mid-October, so onions were coming out of the ground more easily than potatoes.

Onions out of Idaho and the Northwest were still under hoops mid-October, said Mike Gorczyca, procurement manager for Monterey, Calif.-based Pro*Act. During the fall and winter the company sources onions from Idaho, Oregon, California, Washington, Colorado and Michigan, with the majority coming from Idaho or Washington.

California’s fall harvest was also delayed because of a mild spring, but quality was not affected, said Nelia Alamo, director of sales and marketing for Oxnard, Calif.-based Gills Onions. The state’s spring crop is due in March or early April.

In late October, Weslaco, Texas-based The Onion House shipped what owner Don Ed Holmes called a very manageable crop out of Colorado. Holmes said he expects to import sweet onions from Mexico by Jan. 10.

“We’re hoping the prices get a little better,” Holmes said. “This whole onion deal slid off in a ditch in March and has really been in a ditch ever since.”

Holmes said prices have been as low as $4 per carton the last two weeks of October.

Holmes expected to be finished planting in Texas by Nov. 15, right on time for a spring harvest. Overall onion acreage should be down in the Rio Grande Valley after poor markets during the 2011 season for onions and high markets for other crops, including corn, grain sorghum and cotton.

Onion supplies from Idaho and eastern Oregon were looking good for Wilcox Fresh as of the last week of October, said Jim Richter, executive vice president of sales and marketing for the Rexburg, Idaho-based company.

Wilcox Fresh ships its own yellow, white and red onions out of Idaho and Oregon, and moves into sweet onions out of Texas and the Southeast in the spring through its co-packers. Shipping both potatoes and onions out of Idaho allows the company to mix loads and offer its customers one less order to make, Richter said.

Gorzcyca said he expects onion sizing to be slightly off this year, with fewer colossals on the market.

The size profile of onions at Idaho Falls-based Potandon Produce looks fairly normal, said Jamey Higham, vice president of foodservice.

Margaret DeBruyn, chief executive officer for Zeeland, Mich.-based DeBruyn Produce, was still waiting the last week of October to see how the Northwest onion deal got into storage. Grower-shippers were starting to have some issues with cold weather, she said.

The company also imports from Mexico starting mid- to late January.

“We’re really getting ready for the spring Texas season,” DeBruyn said. “Things have been delayed a little because of the drought.”

DeBruyn expects to have plenty of jumbo and colossal onions on the market, with the possibility of more restricted supplies of medium onions.

“Onions are going to be very promotable this year, and bin promotions are going to be a great tool for both potatoes and onions,” Richter said.

Bins lend well for bagged onion promotions, most commonly matching a 3-pound bag of onions with a 5-pound bag of potatoes or a 5-pound bag of onions with a 10-pound bag of potatoes, Richter said.

Richter said he expects the onion market to ride the coattails of the potato market in 2012.

DeBruyn Produce was in the middle of a steady Peruvian sweet import deal this fall. The company also uses co-packers in the U.S. Northwest to ship conventional onions in its label, along with a small volume still through the company’s original headquarters in Michigan.

Keystone Fruit Marketing Inc., Greencastle, Pa., was also importing from Peru late October, bringing in Mayan Sweets. The company’s year-round sweet onion deal also includes Vidalias from Georgia and Walla Walla sweet onions from Washington, said Marty Kamer, vice president. He predicted onion volumes consistent with the last couple years.

With consistent supplies, onions should be very promotable this year, Kamer said.

Sweet onion imposters

Kamer said one of the sweet onion industry’s biggest challenges is meeting consumer demand.

“Even if the year-round sweet onions have become a mainstay in the department, there continues to be a lot of imposters, or onions that are labeled as sweet but fail to meet consumer expectations,” Kamer said. “That destroys consumer confidence and ultimately slows the sales and profits for everyone.”

John Shuman, president and director of sales for Reidsville, Ga.-based Shuman Produce Inc., said his company also is dealing with that challenge.

“One of the biggest obstacles currently facing the sweet onion category is the labeling of grano variety cooking onions as sweet onions to capture a premium price at retail,” Shuman said. “These varieties do not share the same sweet and mild flavor profile of the familiar flat, granex shape of a true sweet onion.”

Shuman said sweet onions are doing well as the fastest growing segment in the onion category but what he calls the “rise of imposter onions” erodes the category through consumer confusion and dissatisfaction.

“Research has shows that consumers consistently include onions on their shopping lists, and it’s the versatility of sweet onions that keeps them coming back for more,” Shuman said. “The sweet flavor profile lends a unique flavor to both raw and cooked recipes.”

Shuman ships sweet onions year-round, and said the Peruvian season bode well for the company with good supplies and outstanding quality.

“We project supplies to remain steady into the first of the new year,” Shuman said.

It’s the economy

DeBruyn said the poor onion markets this year are indicative of more than just cyclical ups and downs.

“What we’re seeing right now is a broader-scale issue with the economy,” DeBruyn said. “We have heard some hope with the economy lately, but for the last year the news has been all doom and gloom. If this was cyclical, by now it should have rebounded a little, but it hasn’t.”

Even as people are eating at home more, there’s still a perception that fresh fruits and vegetables — including onions — are more expensive than other food.

“There’s a lot of shopping the inside aisles of the grocery store,” DeBruyn said.

 

Prices

Out of the Columbia Basin, Wash., and Umatilla Basin, Ore.

  • yellow hybrid 50-pound sacks colossal mostly $6-7.50, jumbo and medium $5-5.50;
  • white 50-pound sacks jumbo mostly $10, medium $7-8;
  • red globe-type 25-pound sacks jumbo $4-5, medium $4.

Source: USDA



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