Information for fruit and vegetables business in CIS
Past week the prices on bulb onion decreased in Ukraine
Despite of the constant depletion of onion reserves on the market of Ukraine the prices on this commodity decreased rather significantly in many regions past week. It seems that market players overestimated the threat of onion deficit; past year the production of this commodity increased by one third comparing to 2003, according to the data of Agricultural Marketing Project.
The most dramatic decrease of wholesale and retail prices on onion was observed in Odesa oblast - the leading supplier of this commodity in Ukraine. In average the price decrease on onion is amounted to 5-8% in the oblasts where the Project works.
The price drop was partially caused by the improvement of weather conditions and intensification of spring field work in the South of Ukraine; it made many farmers sell the commodities and gain the needed current assets. The temperature growth was the other reason to sell onion in connection with the growing percent of its spoilage.
In fact, the sales season for past harvest onion may last approximately till June-July, but the demand on this commodity usually drops down when early onion and other vegetables of new harvest come to market. The practice shows that in major cases the onion sale is the most effective in the period from March to April. Usually the supplies of the newly harvested bulb onion from the southern regions of Ukraine start in the first week of June and become mass not earlier than in the end of June.
According to the expert's evaluations, the self-cost of onion production in Ukraine is about USD $ 0.04-0.05/kg. Despite of the decrease of the wholesale prices they are still rather attractive. Agricultural Marketing Project prognoses the further acreage extension of onion producing lands on 3-6% in 2005, and the rate of production will be nearly the same as in 2004.