Onions

Onion growers need enough land to offset the costs of capital machinery and labour. This usually starts around 5 hectares.

Often land is leased by a contract grower alongside other blocks of land to form enough scale to grow commercially. This means that if you are leasing to an onion grower blocks can be much smaller.

As with all annual crops, onions should be planned to fit into a rotation cycle with one or more other vegetables. This prevents build-up of pests and diseases in the soil over time. 

Access to equipment

Onion growing needs specialised equipment for planting and harvesting, as well as access to cool store and processing facilities. 

A number of onion growers have packhouses on their property, but there are also large third-party packhouses available in most of the major growing regions. You’ll need to work with the packhouse to schedule your harvest and arrange handling for your crop.

Check to see if contractors with the necessary specialist planting and harvesting equipment are available in your area. If not, you’ll need to buy equipment which will increase your up-front costs.

Contracting costs vary widely from region to region, and depend on the type and size of the job. Contact a local contractor for a quote.

Secure a buyer

It’s important to secure a buyer or a contract before planting your crop. Major players like Watties or Turners and Growers will manage the supply chain and provide contracts for growers to supply onions. There are also many established onion growers in New Zealand that grow, harvest, process and secure their own markets both domestically and internationally.

Fresh onions can also be sold directly to distributors such as Turners and Growers or MG Marketing for sale to supermarkets and other retailers. Check that the distributor is prepared to take your crop before planting. You’ll be paid the market rate at the time your onions are delivered after harvest. The market rate will depend on the amount of onions coming to the market, and the demand from consumers at that time.

Contact Onions New Zealand for more information about the support they can provide.

Onions New Zealand

Leasing

Established growers are often eager to lease land that they can use to expand their crop. The lease price per hectare is decided by factors like location, soil, and the condition of the land.

The lease will include information about:

• how long the lessee can use your land
• what they‘re allowed to use it for, and 
• how they must maintain the farm facilities and look after the land.

It's important to get advice from qualified, experienced advisors before you commit to leasing your whenua.

Whenua Leases

Onion varieties

Brown onions, with their golden brown papery skin and white flesh, are the most common type of onion grown in New Zealand. They have a-low water content, so they store well in cool, dark, well-ventilated conditions. Popular commercial varieties include Pukekohe Long Keeper, Early Long Keeper, and Kiwi Gold.

Red onions are becoming more popular in both the domestic and export markets. They have a milder flavour and attractive red tinged flesh. Red onions require refrigerated storage and generally don’t keep for as long as brown onions.

Talk to your seed merchant about the best varieties for your land block.

The grower needs to understand the technical processes of preparing, planting and monitoring the crop as it grows. This is likely to include:

• handling dangerous substances, including sprays and fertilisers
• operating equipment, including tractors and specialised heavy machinery
• understanding compliance obligations, including nutrient management, the Food Act and New Zealand Good Agricultural Practice (NZGAP).

Larger or more established blocks may decide to have their own on-site pack house. To do this you'll need:

• knowledge of how to run a packhouse
• machinery operators such as forklift drivers, and
• grading and packing skills.

Specific horticulture qualifications or experience growing onions are extremely valuable, however Turners and Growers employ horticulturists that can provide help if you need it. Onions New Zealand and Horticulture New Zealand can provide additional support to growers too.

Understanding whenua management

As with any business, there are compliance regulations in regard to health, safety and wellbeing, employment law and tax obligations. Some of the key industry-specific compliance obligations are listed below.

Levies

Growers are supported by Horticulture New Zealand and Onions New Zealand.

• Horticulture New Zealand collects a compulsory levy of $0.14 per $100 of sales.
• Onions New Zealand membership is voluntary. Members pay a levy that is currently set at $2.50 per metric tonne.

These levies can change, so check their websites to make sure you have the latest information.

Horticulture New Zealand membership levy

Onions New Zealand levy

Food safety

All growers must meet the requirements of National Programme 1 under the Food Act 2014. The requirements include rules about how the crop is handled, managing spray residue, and withholding periods. This to make sure the onions you’re supplying to the market are safe to eat.

National Programme 1

Food Act 2014

New Zealand Good Agricultural Practice (NZGAP)

NZGAP is a system that helps growers to keep up with compliance requirements. Some retailers and wholesalers will only take crops from an NZGAP certified supply channel. Becoming NZGAP certified:

• gives you confidence that you're meeting compliance requirements
• makes it easier to find out when regulations have changed, and
• ensures your product meets buyer requirements.

Some wholesalers hold NZGAP certification on behalf of the grower. Check with the company that you are supplying.

NZGAP

Council regulations

Many councils require consents for access to irrigation water and for other activities related to changing land use.

Speak to your local council before investing in any detailed planning or development work to ensure you are aware of any consents or permits needed to start growing onions on your whenua.

Meeting council compliance obligations

Local council contact details

National policy statement for freshwater management (NPSFM)

The National Policy Statement for Freshwater 2020 gives local authorities direction on how they should manage freshwater under the Resource Management Act 1991. As such, some local authorities require growers and farmers to create a Farm Environment Plan (FEP). Make sure you're familiar with the FEP expectations in your region. Check with your local council about the requirements for your whenua or planned development.

Even if your region doesn't yet require an FEP, it's good practice to put one in place for your whenua as part of your business plan. The Foundation for Arable Research (FAR) provides templates you can use to create an FEP.

Developing a business plan

Farm Environment Plan templates

Onions are best grown in well drained, fertile soils. They have high nutrient requirements so it’s important to soil test and fertilise as required before planting. Get advice from a qualified agronomist or other experienced, qualified consultant about the required nutrient levels for your crop.

Nutrient management

Onions have a shallow root system, so nutrients can quickly travel beyond the plants' reach which contributes to leaching. Careful management is needed to ensure the plant will benefit from the nutrients supplied. Planting a deep rooted crop in the rotation immediately after onions will also help to mitigate leaching, as nutrients that have travelled to lower levels of the soil can be accessed and used by them.

Planting and growth

Onion seeds are planted in winter. Some varieties can be planted as early as May in the North Island, but take advice from your seed merchant about the best time to plant on your block. All of the commercial onion seed in New Zealand is planted by September.

The plant will take between 7 and 9 months to become an onion bulb that’s ready for harvest.

Harvest 

The green tops of the onion start to flop as they approach maturity and are ready to harvest. This is usually in January in the North Island, and February in the South Island. At this point the tops and the roots of the onion plant are cut and the onion bulbs are lifted from the soil. They’re laid in rows on top of the bed to dry in the sun for at least 24 hours and, depending on weather conditions and variety, up to several weeks in a process called field curing. This creates the dry skins that protect the onion.

When the onions are dry they’re collected into bins or trailers and transported to the packhouse, where they’re stored for a further 10 days to complete the curing process. Then they’re graded by size and quality before being stored longer, or shipping to the market.

Pest and disease management

Onions are an important export crop for New Zealand, so biosecurity, and pest and disease management, is taken very seriously by the industry. Onion crops in New Zealand are grown using Integrated Pest Management (IPM) principles. This means that the crop is regularly inspected for signs of pest damage or disease, so that any threats can be managed quickly. 

Onions New Zealand and MPI have also signed a Sector Readiness Operational Agreement, which is an agreed approach to preparing for future biosecurity responses to keep the industry protected.

Good bulb formation requires temperatures above 15.5⁰C, with an optimum growing range of between 21-27⁰C.

Onions need a dry spell of at least several days during harvest to allow for field curing, so regions with lots of rainfall during the harvest period of January (North Island) and February (South Island) are less suitable.

Planning for climate change

The yield and quality of the crop will decrease if the crop suffers from water stress during emergence and bulb formation. The crop will also be damaged by too much water, particularly nearing harvest. Contact Onions New Zealand for advice on the best approach to water management for your crop.

90% of onions grown in New Zealand are exported, with most of them being delivered to the northern hemisphere during our major onion export season from February through to May. This is the off-season for our main competitors, which is good for our onion industry.

We export to more than 45 countries around the world, especially around Europe, South East Asia and the Pacific Islands. Our biggest international customers in 2018 were the Netherlands, China, Mexico and India.

The New Zealand export market showed steady growth between 2011 and 2017. The 2018 season was challenging with high crop losses due to drought and disease pressure, but the industry reported an excellent season in 2019.

The Onions New Zealand industry strategy explains their vision of facilitating 'sustainable growth and profitability of onion growers and exporters'. The organisation intends to achieve this through:

• maintaining and enhancing the reputation of New Zealand onions
• targeting export markets to increase total returns for New Zealand onions
• research and innovation to increase sustainable yield per hectare.

NPSFM

The National Policy Statement for Fresh Water Management (NPSFM) will have impacts on intensive land use including vegetable growing. This is likely to result in restrictions to some activities which could have an impact on growers, particularly those who are moving into an industry. As always, it will be necessary to thoroughly research any plans to change land use to make sure you remain compliant with legislation and local bylaws.

Operational costs for a season of onion growing are estimated to be around $7,000 per hectare. This includes costs for: 

• labour
• fertiliser
• sprays
• pest and disease management
• cultivation, and
• harvest costs. 

This figure is based on numbers sourced from the Lincoln Financial Budgeting Manual 2018. It may not capture all costs associated with the crop, so it’s important to get qualified, experienced advice when preparing your budget.

Search for funding opportunities

In 2017-2018 growers were paid between $650 and $750 per tonne of onions. With an average yield of 27 tonnes per hectare, this equates to:

• a gross revenue of around $17,500 to $20,000 per hectare, or
• $10,500 to $13,000 per hectare after operational costs

Seek advice early, before you invest in any design or development.

Talk to your local Te Puni Kōkiri office to see how they can support you through your decision-making process. They will be able to provide advice and find out whether your project qualifies for funding.

Talk to the industry organisation to see what support and resources they can offer to people thinking about growing onions.

If possible, seek out advice from people who grow onions in your area as well as knowledgeable suppliers.

Talk to qualified consultants who are experienced in onion growing and other land developments in your area. They will be able to provide detailed, impartial advice on what will (and won't) work on your whenua.

Find your local Te Puni Kōkiri office

Onions New Zealand

This fact sheet provides general information to help start and inform conversations. It is not comprehensive enough to support detailed decision-making.

The information in this fact sheet has been contributed by AgFirst, Fresh Facts, Onions New Zealand and Te Puni Kōkiri kaimahi. Data that has not been credited in the body of the fact sheet has been sourced from StatsNZ or provided by the contributors.

You can provide feedback on the content on this or any fact sheet by emailing the Whenua Māori Service at whenuainfo@tpk.govt.nz