Market and Crop Update for December 6, 2018

MARKET
Washington:
Trent Faulkner with L&M Companies in Raleigh, NC, reported Dec. 5 on shipments out of the Warden, WA, operation. “Freight is driving demand and the market right now,” Trent said. “Christmas trees are still taking most of the trucks, so while we do have plenty of demand, the lack of trucks has slowed shipments. The market is affected too. While the market hasn’t changed much up or down, if you can find trucks at affordable prices, you can go a little higher, but if the trucks are expensive, you have to go a little lower. The bottom line is that the truck issue is a real kicker.” Trent said that mediums continue to be scarce and commanding higher prices. “There aren’t a lot of mediums out there, so we are getting more for those than the larger sizes. That should be the case for a while because all the regions shipping now produced more large onions than small. The situation probably won’t change until some of the other areas start shipping in February and after.” Trent said that L&M’s availability for colors and sizes is good across the board with the exception of medium yellows and whites. “Like most of the Northwest, our quality is excellent, but we are just short on the smaller stuff for yellows and whites.”

Washington/Idaho:
John Vlahandreas with Wada Farms reported on Dec. 5 from his Salem, OR, sales office. “Demand this week is wishy-washy but not at a standstill,” he said. “Transportation is horrendous, and because of that the customer wants lower prices, but it can’t get any lower. When the freight is double what the onion is worth, you have a real problem – and we’ve just got to find some common ground to make it work here.” John said the size and color moving more heavily is jumbo yellows. “Jumbos are moving, but if you have medium yellows, there are flying out the door.” He also said quality is very good. “Onion quality across the board is fantastic. It’s great no matter what the region in the Western U.S. Maybe that’s what’s wrong with the market.”

Idaho-Eastern Oregon:
Herb Haun with Haun Packing in Weiser, ID, told us Dec. 5 he is “still seeing decent demand,” and he added that supplies are manageable for the remainder of the season. The company had a good Thanksgiving push, and Herb said, “We’re in a good position as far as stocks on hand.” All colors and sizes are available, and he said this week he’s seeing strongest demand for medium reds and yellows. Going into the Christmas season, Herb noted, “I am truly expecting the market to move in the next couple of weeks.” His optimism is based in part on information from the National Onion Association, and he said that supplies in his region of the Treasure Valley are “very manageable.” He added, “I definitely believe we’ve seen the bottom of the market.”

Dan Phillips with Central Produce Distributors in Payette, ID, told us Dec. 5 this week’s market is steady, but demand has been a little off. “The market is steady but still really bad,” Dan said. “And when I say demand is off, it really means the movement is off due to lack of transportation. Sure, orders are coming in, but if you can’t get trucks, you can’t move the product. And when you do get a truck, the rates are astronomical – $2 to 3 dollars higher. Who knows when that’s going to change, but I suspect that because of Christmas trees, and other holiday items moving, the transportation problem won’t clear up before the first of the year. The upside is quality is excellent, and the overall demand is pretty equal across the board for all colors and sizes.”

Utah/Colorado Western Slope:
Don Ed Holmes with The Onion House in Weslaco, TX, said the Corinne, UT, deal is “steady as she goes” with “great, great business.” He added, “We have good supplies of mediums now and will get into bigger sizes next week.” Western Colorado, he said, is finishing the season this week, one of the earliest finishes he’s seen. “We’ve had very good movement all season, and the quality has also been really good,” Don Ed said.

Northern Colorado:
Bob Sakata at Sakata Farms in Brighton told Onion Business Dec. 5 that the onion business is steady. “We had good Thanksgiving business,” he said, adding that although most of Sakata Farms’ customers send their own trucks, he knows transportation is tight in many areas. Onion prices are cheap, but movement is good,” he said. Currently, Sakata Farms has all sizes and colors available, and Bob said he expects supplies to carry through to the normal March end of season.

Mexico:
Rio Rico, AZ, and Weslaco, TX-based SunFed kicks off its second year in onions with Mexican white onions out of the north-central growing region in San Luis Potosi. According to Gretchen Kreidler Austin with the company’s Texas office, the first loads were to arrive Dec. 5. The deal will transition to Morelos mid-month and then to Tamaulipas in January, where it will stay until production starts in the Texas Rio Grande Valley in March. Gretchen told OnionBusiness.com the Mexican onions are all white, and Texas will have the color mix. Mexican onions are available in jumbo 50-pound and 25-pound sacks, 40-pound cartons and RPCs, with special orders and consumer bags also available.

Broker’s Perspective
Rick Greener with Greener Produce in Ketchum, ID, reported on Dec. 5 that this week has been busy for him with onions he is shipping out of Washington, Idaho, Oregon and Utah, with some out of Michigan.
“Today has been a little doggy, but we were really hammerin’ on Monday and Tuesday,” Rick said. “Demand has been good on retail packs and all the normal stuff.” He noted that he is having an easier time getting trucks than he was pre-Thanksgiving, depending on where they are going. “Transportation, in general, is all over the board. Some days I can get a truck right away, and then it might take days before I can get one. Post-Thanksgiving rates have been better to places like Atlanta and Miami, but then again I had a ridiculously high rate to California.” Rick rates the market as steady. “Like most people, I am holding on the market. When it is already low, what am I supposed to tell the growers when there are some people wanting to push it down? I am trying my best to get the most for the growers, and they deserve that. The quality is excellent, and there is really no reason for the low pricing. When I go to the grocery store for three onions, I am going to buy three onions. I don’t care what the price is – and most people are like that. So if the customer is going to still need them and buy them, why the low market? Who knows.”

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