Egypt: Bigger spring onion export, despite heat

The Egyptian spring onion season got off to a great start. In spite of the strong heat in the summer, both quality and yield are better than last year. “We expect to export about 40 million bunches of spring onions,” says Hisham El Meleigy of the Egyptian company Blue Nile.
 
Blue Nile ships spring onions mainly to the UK market. As soon as the German supply runs out, the export of the company is expanded to Germany and the Netherlands. “Last year we exported 30 million bunches, but since then we’ve gained more market share and we’re going to export 30% extra. We lost some customers last year due to price pressure. Other suppliers were cheaper, but it turns out those customers rather wanted our superior quality. So we’ve regained those lost customers and even gained extra orders, which is amazing.”

Blue Nile makes use of 600 hectares, which consist both of rented land and farms that belong to the company. By making use of their own production facilities, management and self appointed staff members, the company is in full control of the whole production chain. “We’re not subjected to market forces, so we can be really precise with the quality and logistics related to our crops.”
 

 
The company produces Giza and Photon spring onions. According to Hisham, prices are lower this year. “We need to maintain lower prices to stay competitive. This goes for all markets. Prices are fairly stable. We do have massive domestic competition within Egypt, but we manage to hold a strong market share in spring onions. Outside of Egypt, our main competitors are Morocco and Senegal, though the economic situation of Egypt gives us a competitive edge.”
 
During this season, Blue Nile has had to adapt its irrigation system to compensate for the intense summer heat. The average temperature stood at 37 ºC, which had influence on all types of vegetables. “We managed to cope with the heat through our contacts in Europe and our own expertise with regards to irrigation,” explains Hisham.
 
According to Hisham, the number of Egyptian spring onion growers is steady and may even be on the decline. The 30% of new orders the company acquired originally worked with other competitors. While the number of growers might be becoming less, the overall acreage remains the same.
 
Spring onions are becoming increasingly popular in Western markets like the UK. “Lots of consumers use them in salads or in stir fried dishes. Consumers are also increasingly becoming aware of the health properties of spring onions. So there is an increase in demand, although spring onions already had matured as a product and demand has been steady for years.”
 
While spring onions have been a staple product for British retailers for years, Hisham does notice a current trend. “Consumers demand a simpler and more economical product. Our packaging is geared towards this trend. The product itself hasn’t really changed, but we do employ new techniques for storage and harvesting. This allows us to make use of export by sea freight, which grants us cheaper logistics while still supplying a good quality product in pristine condition.”
 
Organic spring onions represent only a small percentage of the total spring onion sector. However, the organic segment for spring onions is larger when compared to similar categories within other produce sectors. Generally speaking, the share of organic produce within a full sector comes down to 6% or 7%. With spring onions, this segment accounts for 12% to 15%. “Organic demand is quite high in the UK. This is going to be our first year in which we export organic spring onions,” says Hisham, who feels that a company specialised in a specific type of produce should be able to provide all formats in which said produce can be supplied.
 
“Our company is fully focused on export. We don’t grow varieties that are in demand in the local market, as that would limit our capabilities. We spend all our energy on managing export. Of course, the domestic market can be profitable as well, but every company has limits with what that company can manage. You need to focus on what you’re good at. We’ve specialised in five products what we’re good at and we invest all our effort in improving these products, to increase our quality and allow for more efficient production. This way, we aim to gain a few percent of market share every year,” concludes Hisham.