Above-average yields in later-season Vidalia onion fields have spilled over into the Peruvian sweet onion deal, creating a challenging market.
The first shipments of Peruvian sweets typically hit the U.S. in early to mid-August as the Vidalia season wraps up.
But this year’s Peruvian crop was early, with first shipments arriving in late July.
In addition, the early Vidalia season was slowed by production challenges, and many thought it would be a smaller-than-average crop.
The situation turned around quickly, and yields from later fields were strong, creating larger supplies on the tail end.
“The problem is it depressed the movement of the entire deal and slowed down movement of the Peruvians as well,” said Brian Kastick, president of Savannah, Ga.-based Saven Corp., which markets the Oso Sweet brand.
As of Sept. 16, the industry was down 18% year to date in loadings out of Peru bound for the U.S., Adam Brady, marketing coordinator for Reidsville, Ga.-based Shuman Produce Inc., said in an e-mail.
Ralph Diaz, export and import manager for Karpinski Trucking & Produce Inc., Sunbury, Pa., said he was hopeful the oversupply would clear out by later September as people switch to Peruvian sweets.
“It’s going to get better. You have to be optimistic,” he said.
Barry Rogers, president of the Melbourne, Fla.-based Sweet Onion Trading Co., said he doesn’t expect the market to recover until about November.
“Somehow the Vidalia growers managed to salvage their very best stuff and put it in storage, and there’s some overlap,” he said.
Although Peruvian officials predict their country’s 2013 sweet onion crop will be 10% larger than the previous year, not everybody agrees with that forecast.
“I think the volume is going to be a little lighter,” Diaz said. “The importers are kind of hesitant to lay out that much money. There are a lot less commitments and less advances. They’re not giving out the big advances like they did in the past.”
If that proves to be true, he said, supplies could tighten toward the end of the season.
Rogers agreed and said he expected supplies to tighten by the end of November.
“In fact, I think it will get very tight,” he said, citing a smaller crop.
In U.S. onion markets, Peruvian imports accounted for about 10% of value and about 19% of volume in 2013, according to the U.S. Department of Agriculture’s Economic Research Service.
Despite sluggish movement, the initial quality of the Peruvian crop has been excellent, said Kevin Hendrix, vice president of Hendrix Produce Inc., Metter, Ga.
Based on early shipments, he said jumbos dominate, with a few mediums for consumer packs.
Todd Van Solkema, chief executive officer of Van Solkema Produce, Byron Center, Mich., agreed, saying about 65%-70% of his early shipments are jumbos.
“And that’s going up every day,” he said.