BOISE — Domestic bulb onion prices have risen rapidly since falling below break-even levels this winter.
“The market’s really strong right now,” said Nyssa, Ore., farmer Paul Skeen, president of the Malheur County Onion Growers Association.
The mood at last week’s National Onion Association meeting in Boise was markedly better than it was at last year’s event, Skeen said.
“Things are definitely better now than they were this time last year,” he said. “Everybody’s more upbeat nationwide.”
Bulb onion prices were at depressed levels last fall and got worse through the winter, falling as low as $4 for a 50-pound bag of jumbos, said Kay Riley, manager of Snake River Produce, an onion shipper in Nyssa.
“That’s below break-even and doesn’t really cover production on the farm,” he said.
But prices have increased rapidly since March and are now at $16 a bag.
“For a mid-summer market, that’s exceptionally high,” Riley said.
NOA Executive Vice President Wayne Mininger said the rise in onion prices was largely a result of heavy rains that significantly reduced the onion crop in Mexico and Texas.
“There was a big reduction in supply and the markets improved dramatically in the spring and they continue at a very profitable level through the summer to this point,” he said.
Onion growers in Southwestern Idaho and Eastern Oregon, the nation’s largest onion producing region, are hopeful prices will still be robust when they start shipping this year’s crop in the fall.
“Once we get started shipping, the pipeline should be somewhat empty and we should have a good market to begin with,” Skeen said.
An improving transportation situation has also helped the industry, Mininger said.
During the NOA’s Boise meeting, national experts said truck transportation rates and availability are both better this year and the West Coast port situation has improved significantly.
But the industry still faces some significant challenges, Mininger said, including a persistent labor shortage and how the Affordable Health Care Act will affect employers going forward.
“At the moment, there’s less pressure on the industry but there are certainly challenges, too,” Mininger said.
Riley said onion growers are also anxiously awaiting the U.S. Food and Drug Administration’s final produce safety rule, which is due in October.
The rule limits how much bacteria can be present in irrigation water. That’s a major concern for onion growers in this region because most of their water wouldn’t meet the FDA’s standards.
However, FDA included a bacteria die-off provision in its revised rule that allows a farm commodity to comply with the rule if scientific evidence shows that bacteria dies off the product quickly after harvest.
The onion industry in this region believes fields trials conducted by Oregon State University researchers the last two years have proven that.
“We’re optimistic the FDA’s final rule will be something that is manageable for us,” Riley said. “But until we actually see it, it’s still a cause of apprehension.”