TASMANIA is one of the major growing regions of Australia, producing more than half of the country’s onion exports, has played a key role in developing a new national export strategy.
It is estimated there are fewer than 10 major grower/exporters in Australia that produce the bulk of Australia’s export onions.
Tasmania, South Australia, and Western Australia are producing 97 per cent of the export volume, with Tasmanian onions accounting for 52 per cent of the total export trade.
Although around 15 per cent of Australia’s onion volume is exported, it used to be a much higher proportion.
Onions are Australia’s fourth largest vegetable crop accounting for 9 per cent of vegetable production.
Australians consume about 7.8kg per capita each year.
A new export strategy has been launched providing Australian growers with a roadmap to guide export development investment decisions to ultimately improve both the export and domestic onions market.
As part of a Hort Innovation levy-funded project “Onion Industry Export Strategy” (VN20003) strategic planning consultancy McKINNA et al has created a strategic five-year export plan 2021-2026 for the Australian onion industry.
Premium Fresh Tasmania owner Jim Ertler, on the north-west, which has been growing onions since the early 2000s, has been exporting for the past 14 years. Premium Fresh Tasmania, established about 55 years ago, is a privately owned vegetable farming and processing operation.
Mr Ertler believes the export strategy is key in supporting growers’ exporting business plans and replacing the decreased demand in domestic markets because of recent oversupply.
“Over the last 18 months we have seen peaks in domestic market demand, but with the ongoing lockdowns and border closures that market has slowed things down for us,” he said.
Export markets have provided an alternative route for Premium Fresh in replacing domestic market lulls, but not without the challenges of shipping and fulfilling orders continuing.
“The Onion Export Strategy will assist in building brand awareness and sustainability.”
This use of levy funds will support growers in their business strategies particularly if they are currently not exporting.
“There are no benefits in selling product below cost.”
“We need to all work towards managing the volumes placed on the domestic market to ensure that it is not oversaturated.
“The strategy can be part of growers plans to manage supply volumes on the domestic market which will benefit all.”
With building more sustainable export markets one of the key recommendations of the strategy, Premium Fresh has delved further into the European and South-East Asian markets.
“We are keen to explore our new markets, particularly with the guidance and support of the export strategy findings,” Mr Ertler said.
The Export Strategy was developed following a detailed market and competitor analysis, known as the Market Mapping Report with leading onion exporters and marketers.
The strategy recognises the global market for onions is highly competitive and dominated by India and China, who set price expectations in many of the markets in which Australia competes.
Therefore, Australian exporters must compete based on premium quality and product integrity.
Onion Export Strategy project lead Dr David McKinna said the strategy hopes to grow the onion export market as the opportunities exist; they just need to be explored.
“There is opportunity to grow our market, if industry exports, pressure is taken off the domestic onion market,” Dr McKinna said.
“The strategy aims to reduce domestic price drops by taking small amounts of onions off the market and creating a knock-on effect, meaning there is a substantial cause for onion levy payers to invest in their exports, even if they are not exporting.”
“If we sell on the export market at or below cost, the effect on the domestic market is great.”
“To develop our international markets, it is all about improving relationships, ensuring we have trust and a good working relationship with those markets.”
Local growers need to sell at a substantial premium to international markets, so having that quality edge is critical.
“I encourage growers to read the export strategy even if they’re not exporting themselves, as it does give great insight into the industry and it is important for all growers to understand the importance of exports,” Dr McKinna said.
For more information about the project, domestic and international trade and industry support, visit: http://www.horticulture.com.au