While retail have seen strong sales in onions in 2020, demand for industrial uses of onions have also jumped.
“We’ve seen a growth in the industrial market because in 2020, shelf-stable products are flying off the shelves. Companies are ramping up production of these products and onions are a great ingredient—particularly in sauce-based products,” says Megan Jacobsen of Oxnard, CA-based Gills Onions, a fresh-cut processor. She notes the majority of its customers in this category are tomato sauces.
In fact, that jump in industrial uses for tomatoes have helped offset the drop that foodservice onion use have seen this year. “There was a balance with increased industrial use in the spring and summertime. And foodservice had bounced back to a level where we are 80-90 percent of what we were last year,” says Jacobsen, noting Gills grows its own supplies of onions for industrial, foodservice and retail categories. “However, this past week California and several other states shut back down and that’s a little concerning going into the holidays.” And retail sales continue to be strong. “The past two weeks have been the biggest pull of the year,” Jacobsen adds.
New product launch
With that strength behind them, the company also launched a pickled red onion product in retail this year, an extension of the foodservice pickled onion product the company already offered. “It’s a different conversation launching a new product in the middle of a pandemic,” says Jacobsen. “A lot of produce companies will tell you they’ve had to switch up their product development launches because retailers weren’t adding new SKUs at the start of the pandemic. But things have started loosening up now.”
On the supply side, Gills Onions finished harvesting at the end of October in King City, CA (Monterey County/Salinas Valley) and planting also began in October in Brawley, CA, and harvest on those onions begin around April 15th. This month, planting has also begun in Bakersfield, CA, the company’s single-largest growing area and harvest in that region starts in the beginning of June.