The 2nd Nunhems Onion Seminar (Part I): Global Onion Market Analysis

On the 24th August, the 2nd Nunhems Onion Seminar was held in China’s prime onion farming location – Jinchang City, Gansu Province, as participated by nearly 200 people from breeding, planting, processing and logistical industry chains, focusing on discussion of global onion business development.

Jeff Boettge, the onion business strategic development director of Nunhems, gave a briefing of the global onion business development. From 2010 to 2015, the global onion harvesting area was 4,400,000 – 4,500,000 hectares, which have remained stably over recent years. However, with the raised production efficiency and updated variety research, the onion output in this period continued to grow. The onion output of 2010 was 78.90 million tons, which was increased up to 90.50 million tons in 2015. Global trading volume of onion has been rising, with certain degree of fluctuation, having reached 16.40 million tons in 2015, 11% up year on year.

Top 10 Onion Export Country	Top 10 Onion Import Country
Netherlands	US
China	Malaysia
Mexico	UK
India	UAE
US	Saudi Arab
Egypt	Japan
Spain	Germany
New Zealand	Netherlands
France	Canada
Peru	Brazil

US: An area of 550,000 hectares, highly mechanized

Jeff Boettge said that the US has an onion planting area of 550,000 hectares, of which 70% is long-day area, 20% is short-day area and 10% is in between long-day and short-day area. Onion produced in long-day area has a longer storage life, and proportion of onion produced in this area is rising considerably. As being benefited by the climate of the West Coast of the US which is fit for onion growth, planting of onion is more centralized in the West Coast.

Over 40 years ago, onion is planted mostly by small farms. With the development of large scale and mechanization of growth of onion, big farms have become the main growers of onion and the size of a normal onion farm can reach 120 hectares. The onion growers of the US are aged 55 in average, the per capita onion consumption of onion is about 10 kilos.

Since the 70’s last century, planting of onion in the US has started to be mechanized. After 40-year development, sowing, harvesting and processing of onion have been all mechanized. “Recently I visited a farm, where production of onion is fully mechanized. A consumer becomes the first person to physically touch onion,” said Jeff Boettge.

Europe and Central Asia: an area of over 400,000 hectares, big difference between different countries

Franco Meidioli, the European Onion Marketing Director of Nunhems, is responsible for businesses in Europe and Central Asia. Franco Meidioli said that the planting area of onion in this region reaches over 400,000 hectares, including long-day area of 200,000 hectares and short-day area of 200,000 hectares each, but there is less area between long-day and short-day area. The yellow skin onion accounts for 65%, red skin onion accounts for 30%, the amount of white-skin onion is small.

Due to the vast area, there are great differences between different countries as regards growers and consumptions. Russian growers are aged above 50 in average, there are growers who have a planting area of 2 to 3 hectares and growers who have a planting area of 1,000 hectares. So far as per capita consumption is concerned, Central Asia has far exceeded the US and Brazil, having reached a per capita consumption of 20 to 30 kilos. The consumption of Spain is 9 to 10 kilos, Germany and Netherlands are about 5 kilos, Italy is about 4.5 kilos and Switzerland has the least consumption which is only 400 grams. Franco Meidioli noted the 2 most obvious changes of planting of onion in Europe. One is that large farms are getting larger, the other is that growers’ needs of technical knowledge and experience for planting are increasing.

South America: an area of around 120,000 hectares, being mostly yellow skin onion

Patricia Guerra, the South American Sales Manager of Nunhems, said that the 5 countries of South America under her responsibility have an onion planting area of around 120,000 hectares, where growers are aged 55 in average. The yellow skin onion is planted mostly in this region, small farms are the main growers of the region with a planting area of 4 – 5 kilos while the area of big farms can reach 1,000 hectares. Over recent years, there is a change in growers, where big farms are increasing and small farms are decreasing.

Brazil is the major onion planting country in South America. Taty Brisolla, the representative from Brazil Onion Association said that Brazil has an onion planting area of 58,000 hectares, producing 1.7 million tons of onion annually. Of which 85% is supplied to domestic consumer market, the per capita consumption of Brazil is 8 kilos. Onion industry is of special importance to the agriculture of Brazil, having created 350,000 job opportunities and having become the main source of income of more than 50,000 households. Brazil has established an onion industry association, which unites all industry chain players to promote and protect the development of the inion industry the country.

“The higher cost of production and lower level of mechanization are major problems confronting the onion industry of South America,” said Patricia Guerra. Local onion industry needs to reduce its cost of production via promotion of mechanized production, thus enhancing the product competitiveness.

“Onion is a difficult business,” said Jeff Boettge, which is acknowledged by all seminar participants. Weather has a considerable impact to agriculture, planting of onion requires very careful management while market fluctuation causes difficulties in onion production. Over the last 60 years, onion prices have fluctuated constantly.

With the upgrading of onion quality, increasing of mechanized production and diversifying of market demand, it can be seen that onion production has a promising future. “We need to look at the future, stick to the quality-first principle, and to better understand market changes and clients. It is important to implement a differentiated and dedicated business strategy, make continuous improvement and increase efficiency”, said Jeff Boettge. It looks that this is the only route to the commercial success of onion business.