Onion prices still increasing but may taper off next week

Affected by the recent heavy rains and floods in the south and dry weather in the north, vegetable prices across China have rebounded. Onions have experienced the biggest fluctuation in prices recently. At the Beijing Xinfadi Market, the wholesale price of last week rose by 16.13% on a week-on-week basis and surged by 125% year-on-year. The price this year has risen sharply, with high sales. Industry insiders expect the tension on the supply side to be loosened as large volumes of early onions from Liaoning and Gansu hit the market next week.

Some industry insiders pointed out that the current market situation is not accidental. This year, the planting area of onions in North China and East China has both decreased, resulting in a significantly lower supply compared with previous years, which has an impact on supply and demand. In the past two years, the income of farmers in North China and East China has been poor, and the storage sector has suffered continuous losses. As a result, the planting area in North China and East China this year is lower, and the supply is significantly less than in previous years.

In addition, the temperature this year is lower than that of previous years. The new onion seasons in Liaoning and Gansu have been delayed slightly. Seeing a slow rise in the price, growers tend to wait to see how the market will develop in a later period, and the enthusiasm for harvest is not high, resulting in the tight supply.

Moreover, some analysts pointed out that some major onion producing countries have been affected by extreme weather and have cut production significantly. Buyers from Southeast Asia, Japan, and South Korea have come to China to purchase onions, which has led to a significant increase in onion exports, which is also the main reason that prices grow continuously.

Source: Sannong China


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