Boom and bust for onion farmers
Onions have now climbed to $400 per pound on the local market, doubling the price since April, when farmers were almost giving the crop away.
Then they faced competition, diminished markets, and limited storage capacity.
Now the traders benefiting from the high prices are said to be persons who bought and held volumes of the crop in order to profit off demand in the off-season.
Lenworth Fulton, president of the Jamaica Agricultural Society, said onion growers were faced with competition from imports, and, further, had nowhere to properly store the highly perishable crop, despite promises by the state to resolve that problem.
Some 200 farmers, many of whom operate on leased lands owned by the Jamaican government, were promised storage for their onions, so that they could have enough to sell all year round.
A farmer in St Thomas explained that during the reaping season in the final quarter of 2022, when onion growers were hoping to sell their crop at $210 per pound, permits were issued to importers, which led to an oversupply on the market.
Consequently, farmers practically “gave away” onions at $120 per pound, and ended up incurring losses and getting deeper into debt, the farmer said.
“It is the person who issued the permits who is responsible,” he charged.
With limited returns from the crop, the farmer says he lacks resources to prepare the land for the next crop.
Eventually, prices climbed back to around $200 per pound in April.
The doubling of the price since then has been linked to the activity of market opportunists.
With a surplus of cheaper onions available, opportunists with storage capacity reportedly bought up the tuber at cheap prices, and are currently selling at a premium now that onions are again in short supply.
JAS is of the view that the exploitation of the market is facilitated by lack of a proper onion import policy and unfulfilled promises.
“The government promised to offer storage to onion farmers, but this has not happened as yet. The JAS has also called for an import policy to regulate things like onion, Irish potato, chicken parts/back and neck, but to date nothing has happened as well,” the JAS president said.
“We are working in the dark. You can plant 10 acres and a man goes and gets an import licence and your crop cannot sell,” he said.
Floyd Green, who was recently named Ministry of Agriculture, declined to comment on the issue, saying he was new to the ministry and he had no knowledge of the past permits and he, himself, had issued none. Permanent Secretary Dermon Spence did not respond to requests for comment.
The Jamaican government has an active onion policy to increase local production as offset against imports, a project that includes the provision of land in agro-parks for farming, extension and support services from the Rural Agricultural Development Authority, RADA, and marketing through Agro-Investment Corporation.
However, farmers complain that the Ministry of Agriculture often issues permits for imports during reaping season for local onions, thereby forcing them to compete directly with the foreign goods.
Onion output has been on the rise under the programme, with the latest data from Agro-Invest showing volumes of 3,928 tonnes at year ending March 2022, from 2,106 tonnes the previous year.
Agro-Invest estimated onion yield at more than 11 tonnes per hectare. More was planted across the parishes of St Thomas, St Catherine and Clarendon.
Jamaica traditionally produces about 30 per cent of onion demand. But the agriculture ministry has said it is aiming for 100 per cent self-sufficiency, which would require putting 20 hectares of land into onion production.
Agro-Invest facilitates more than 50 private growers on leased lands at Amity Hall in St Catherine, and Ebony Park in Clarendon.
The farmer in St Thomas says, for a new onion investor, it costs $1.5 million for inputs and land preparation for planting. The cost is less for older farms that have already put in irrigation, he said.