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Strong dollar impacts Pacific Northwest onion exports, challenges in key markets

Stu Follen has provided an analysis of the current difficulties U.S. onion exporters are facing, particularly from the Pacific Northwest (PNW), as they navigate one of the slowest export seasons in recent memory. The analysis indicates that the strong U.S. Dollar has adversely affected the competitiveness of American onions in traditional export markets such as Japan, Taiwan, Hong Kong, Panama, and occasionally Korea, from September through February.

In Taiwan, a traditionally small but consistent market for U.S. onions, there has been a significant reduction in imports. The high value of the U.S. Dollar has made U.S. onions more expensive, leading Taiwanese buyers to opt for Dutch onions. Additionally, New Zealand, facing shipping constraints to Europe due to the Gulf conflict, has redirected its onion surplus to Taiwan, further saturating the market. Another factor is the indirect import of Chinese onions via Vietnam, circumventing Taiwan's restrictions on direct imports from China.

Exports to Japan have also suffered due to the strong dollar, making a $10 bag of onions effectively cost more than $15, pushing Japan to source more affordable onions from China and Europe. Panama presents a high-risk market due to its unpredictable government policies affecting import rules. In Hong Kong, cheaper Chinese onions have become more attractive due to the currency exchange rates, while Korea shows variable demand based on its domestic crop performance.

Follen emphasizes the globalized nature of the onion market and the significant challenge posed by the strong U.S. Dollar. For U.S. onion producers to regain their competitiveness on the global stage, a normalization of the U.S. Dollar against major currencies is necessary. OnionBusiness.com acknowledges Stu Follen and SL Follen Company for their contributions and insights into the complexities of offshore onion exports.

Source: Onion Business

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