Netherlands: Sorting capacity bottleneck for higher bale price
There seems to be only one explanation for the prices: the enormous collective sorting capacity with which individual sorting companies try to pull in market share. The pennies earned in the great onion year 2010, were invested in expanding sorting capacity the following year, causing an increase of 30,000 tons per week. With profit to be made, capacity is cranked up even further. With an astounding average of 21,000 tons, capacity is still not fully exploited, leading to increasing competition among sorting companies. The Dutch onion sector is now in danger of losing potential revenue through increasing rivalry.
So the biggest bottleneck seems to be the increased sorting ability. One solution could be the reduction of capacity, but anyone familiar with the onion market, knows that this is a utopia. Another option is to work together to generate more market share on the world market. This however, requires a very distinctive quality.
