The value-added category gets mixed reviews among onion growers, shippers and marketing agents.
The category fills a vital niche, but it has little room for growth, said Stormy Adams, chief executive officer of Hatch, N.M.-based Shiloh Produce Inc.
“I think that’s a fully mature market,” he said.
The value-added category is falling victim to economics, Adams said.
“To me, the value-added is losing steam just because of the cost of packaging,” he said.
Costs are what kept Las Cruces, N.M.-based Barker Produce Inc. out of value-added, said Brandon Barker, vice president.
“We were going to get into that and the price of everything went up,” he said.
Not that Adams doesn’t believe in the category. He said value-added comprises up to half of Shiloh’s business.
It’s not a growing percentage, though, he said.
“For us, it’s been status quo the last few years,” he said.
Whether it’s peeling, cutting or consumer-friendly packaging, value-added has a strong following in onions, Wayne Mininger, executive vice president of the Greeley, Colo.-based National Onion Association.
Pre-peeled product is particularly compelling, he said.
“I think it’s hard to argue with the fact that the fresh peeling industry has been the most significant value-added practice in the last 25 years, whether it’s in foodservice kitchens or home kitchens,” he said.
Getting into the value-added category can be a simple as offering a consumer-pack option, said Jeff Brechler, salesman for Edinburg, Texas-based J&D Produce.
“It depends on the customer and how they choose to sell the product, whether it’s a club store or retail store or a fruit market, if you will,” Brechler said.
There are more ambitious concepts out there, too, said Steve Smith, president and owner of National Onion Inc., Las Cruces.
“Occasionally, we’ll get a processor we sell for that wants to buy them prepared and can dice them so they don’t have to dispose of the peels, but we haven’t gotten into that yet,” he said.
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