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As prices rocket, will British crop help dry onion tears?

As prices rocket, will British crop help dry onion tears?

Drought in New Zealand has sent onion prices soaring. But suppliers hope they will fall again when the British crop is harvested. Julia Glotz reports

The price of onions in the supermarkets is reaching eye-watering levels, following an exceptionally poor growing season in New Zealand. Drought conditions there have reduced yields and sent retail prices soaring, with many lines experiencing double-digit year-on-year price inflation – and some rising by as much as 50%. 

Of 41 onion products on sale in the big four supermarkets this week,24 have gone up in price over the past 12 months and 14 are now at least 20% more expensive than they were a year ago []. Twelve products cost the same as they did last year, and just five products are now cheaper. 

Robert Oldershaw of the British onion Producers’ Association said reduced volumes coming out of New Zealand had ‘dramatically increased’ the price of onions to British importers. 

“Inflationary onion prices throughout august are mainly down to the exceptionally poor growing season in New Zealand, which saw drought conditions for many months and consequently a dramatically reduced yield by around 30%” he said.

Red onions have been hit particularly hard by the price inflation – of the 17 red onion products in our basket, 12 have gone up in price over the past year. For example, a pack of three red onions is 50% more expensive across Tesco, Asda and Sainsbury’s now than it was this time last year, at £1.27 compared with 85p. 

Only Morrison’s has held steady on the prices of its red onion three-pack, and is still selling for 69p. its loose red onions, however, have risen 23.7%, from 97p to £1.20 per kg – the same as Sainsbury’s and Tesco. Meanwhile, Asda’s loose red onions have gone up 20.6% to £1.17. 

The situation is no better for brown onions. In Asda, a 1kg pack of standard brown onions has gone up 40.5% over the past year, and now costs the same – £1.18 – as a 2kg pack of budget brown onions. Brown onions have also gone up in Sainsbury’s, with a 1kg pack rising 20% from £1 to £1.20 over the past year.

Brown onions sold loose have also experienced significant retail price inflation, although the rises are less dramatic than for pre-packed produce. Across the big four multiples, the price of 1kg of brown onion has risen an average of 13.2%, with Tesco. 

Sainsbury’s and Morrison are all increasing their price from 87p to 99p, and Asda moving from 87p to 97p. 

However, Oldershaw said the situation should improve soon. All retailers were now stocking British brown onions again, with red onions to follow shortly. 

Prices were likely to come down again once the British main crop was in “full swing”, he said, “Although with onions, it is always too early to tell until the crop is safely in the store as adverse weather at harvest can dramatically affect saleable yield”

Oldershaw also warned that even with a strong British onion harvest, “it is vital for the sustainability of the overall onion supply that the costs of the expensive import season are recovered over the next few weeks and months”. 

From ‘The Grocer’ magazine (27/08/2011)(Page 17)