Equipment Checklist & Setup Costs for an Onion Farm

Onion production is one of the more equipment-intensive vegetable crops. Bulbs need precision bed preparation, consistent irrigation, mechanical harvest, forced-air curing, and temperature-controlled storage before they reach a buyer. Getting the equipment selection right before you write your business plan prevents the most common first-year overspend: buying heavy iron for a 10-acre operation that a local contractor could run at a fraction of the cost.

Below is the core equipment checklist for a 10-50 acre commercial onion operation, with US and UK price ranges. Shared-ownership schemes, machinery rings (common in the UK), and USDA FSA equipment loans can significantly reduce the upfront outlay.

Field Preparation and Planting

• Tractor (80-120 hp): $35,000-$75,000 new; $12,000-$35,000 used (UK: £25,000-£55,000 new). Most small operations share or contract this in year one.
• Raised-bed former or ridger: $2,500-$8,000 (UK: £2,000-£6,000). Onions perform best on raised 4-inch beds with a 36-inch row spacing, this single piece of kit often drives a 15-20% yield improvement over flat planting.
• Transplanter or direct-seeder (precision air seeder): $4,000-$18,000 (UK: £3,000-£13,000). Direct seeding is the US standard; transplants are increasingly used for premium short-day varieties and off-season production.
• Disc harrow and rotary tiller: $3,000-$9,000 combined (UK: £2,500-£7,000). Onions need a fine, clod-free seedbed, poor prep is the most common cause of patchy stand establishment.

Irrigation

• Drip tape system (per acre installed): $600-$1,200/acre US (UK: £450-£900/acre). The preferred method in the Pacific Northwest and California, reduces foliar disease pressure compared to overhead sprinklers.
• Centre-pivot or solid-set sprinkler (50 acres): $40,000-$120,000 installed. More economical at larger scale; doubles as frost protection in early spring plantings.
• Pump station and filtration: $3,500-$12,000 depending on water source and pressure requirements.

Harvest, Curing, and Storage

• Windrower or topper/digger: $8,000-$22,000 (UK: £6,000-£16,000). Tops are cut or bent and bulbs undercut to begin field curing 5-7 days before mechanical pickup.
• Harvester (self-propelled or tractor-mounted): $15,000-$55,000 (UK: £10,000-£40,000). At under 20 acres, custom harvest contractors at $80-$120/acre are usually more cost-effective than ownership.
• Forced-air curing shed (per 1,000 cwt capacity): $8,000-$20,000 to build and equip. Onions must be cured at 95°F with high airflow for 3-4 weeks post-harvest. Skipping this step is the single biggest source of post-harvest storage rot.
• Cold storage (32-35°F, per 500 cwt): $15,000-$45,000 depending on insulation and refrigeration. Extends shelf life to 6-8 months for long-day varieties, enabling direct sales outside the harvest window.
• Conveyor line, grader, and mesh-bag filler: $6,000-$18,000. Required for packing and retail presentation; UK supermarket supply chains require automated weight-grading.

Total equipment investment for a 20-acre turn-key operation (owned equipment, new): approximately $120,000-$200,000 US (£85,000-£145,000 UK). For a leased-equipment or contract-service model on the same 20 acres, the first-year equipment spend drops to $18,000-$40,000, primarily curing shed, storage, and packing line.

The business plan section on equipment financing should model both scenarios side by side. Lenders value the analysis; it shows you understand the make-vs-buy decision rather than defaulting to full ownership.

Startup Capital Requirements for an Onion Farm

Starting a commercially viable onion operation typically requires $50,000 to $350,000 in the US, or £35,000 to £250,000 in the UK. The wide range reflects the difference between a 10-acre leased-land starter farm using contract services and a purpose-built 50-acre operation with owned equipment, cold storage, and a direct-sales channel.

The breakdown below is based on a 20-acre mid-scale operation in the US Pacific Northwest, the most productive onion-growing region, with comparable UK figures for a similar acreage in East Anglia or Lincolnshire, both of which account for the majority of UK commercial onion production.

Cost Breakdown by Line Item

• Land lease or purchase (10-50 acres): $15,000-$120,000 (UK: £8,000-£80,000). USDA cropland averages $5,460/acre purchase price (2023); annual lease rates for prime onion ground in Treasure Valley Idaho range $150-$280/acre.
• Irrigation system (drip or furrow): $8,000-$60,000 (UK: £5,000-£45,000). Drip tape at $700-$1,000/acre; larger furrow or pivot systems cost more upfront but less per unit at scale.
• Tractor, planter, and harvest equipment: $15,000-$80,000 (UK: £10,000-£55,000). Contract harvesting at $80-$120/acre removes the largest single capital item in year one.
• Seed, fertiliser, and crop protection (per acre): $1,500-$2,500/acre US (UK: £1,000-£1,800/acre). Seed alone runs $400-$800/acre for certified varieties; nitrogen fertiliser is the second-largest recurring input.
• Forced-air curing shed and cold storage: $5,000-$45,000 (UK: £4,000-£30,000). Renting cold storage from a local packing shed is a common cost-reduction strategy in year one.
• Labour, first growing season: $4,000-$25,000 (UK: £3,000-£18,000). UK growers using seasonal gang labour must verify GLAA licensing status of any gangmaster used.
• Licences, certification, and insurance: $2,000-$8,000 (UK: £1,500-£6,000). US USDA GAP audit typically costs $500-$1,500; UK food business registration is free.
• Working capital (3-month operating buffer): $5,000-$20,000 (UK: £3,000-£15,000).

Funding Routes

In the US, three funding routes dominate for new onion growers. SBA 7(a) loans, under NAICS code 111219 (Other Vegetable and Melon Farming), offer up to $5 million with a 75% federal guarantee and repayment terms up to 25 years. As of 2026, the SBA Grocery Guarantee programme extends the federal guarantee to 90% for eligible food-supply-chain operators including produce growers, per the SBA's March 2026 announcement. USDA FSA Direct Farm Operating Loans cap at $400,000 and are specifically designed for beginning farmers with under 10 years of experience. USDA Beginning Farmer programmes include preferential interest rates and reduced collateral requirements.

In the UK, the Start Up Loans scheme provides up to £25,000 per director at 6% fixed interest with free mentoring, the most accessible route for a solo founder. The Rural Payments Agency Basic Payment Scheme (now transitioning to the Sustainable Farming Incentive) provides ongoing income support for eligible hectarage. UK farmers can also access HSBC, Lloyds, and Natwest agricultural lending at base rate plus 2-3.5%, typically secured against land or farm assets. See also: vegetable farming business plan for broader UK horticultural funding guidance.

Our bespoke plan service includes SBA-compliant financial projections and cash-flow models formatted for USDA FSA applications. See the Bespoke Business Plan for details.

Key Suppliers Every Onion Grower Should Know

Supplier relationships, particularly for seed, inputs, and packing, have an outsized impact on margin in onion farming. The seed variety you plant determines day-length response, yield potential, and storage life. Your packer or broker sets the price floor. Getting these relationships locked in before you plant is not optional for a fundable business plan; investors and SBA lenders want to see named supply and offtake arrangements, not placeholders.

Seed Suppliers (US)

• Nunhems (BASF Vegetable Seeds): One of the largest onion breeding programmes globally. Varieties including Talon (long-day storage), Fortress (intermediate), and Highlander suit Pacific Northwest conditions. Seed prices: $80-$250/lb for hybrid varieties.
• Seminis (Bayer): Produce a wide range including Vaquero (yellow intermediate), Cometa (white short-day), and Redwing (red). Available through local dealers including Wilbur-Ellis and Helena Agri-Enterprises.
• Johnny's Selected Seeds (Winslow, Maine): Primary supplier for smaller acreage direct-market and organic operations. Strong trial data for short-day and intermediate varieties in East Coast conditions.
• Harris Moran Seed Company: Specialised in processing and storage varieties; widely used in the Columbia Basin and San Joaquin Valley. Owned by Vilmorin-Mikado.

Seed Suppliers (UK)

• Elsoms Seeds (Spalding, Lincolnshire): The dominant UK onion seed house. Varieties include Centurion F1 (globe yellow, the UK standard), Santero F1 (flat, for early harvest), and Cortina (red). Organic seed available for Soil Association-certified growers.
• Tozer Seeds (Cobham, Surrey): Focus on specialist salad onions and pickling varieties; also supply mainline bulb onion cultivars.

Fertiliser and Crop Protection

• Wilbur-Ellis (US, 40+ states): Full-service agronomy with custom blend fertiliser programs for onion bulb development. Strong in the Northwest. Typically offer net 30 or crop-year payment terms.
• Helena Agri-Enterprises (US): Part of Sumitomo Chemical group; comparable product range and agronomic support to Wilbur-Ellis across the Midwest and South.
• Agrii (UK): The largest independent crop input distributor in the UK; direct agronomist support for commercial allium growers in Lincolnshire and East Anglia.
• Hutchinsons (UK): Strong in precision nitrogen management for onions, over-application of nitrogen delays maturity and reduces storage quality.

Packers, Brokers, and Off-Take Partners

• Peri & Sons Farms (Yerington, Nevada) / Owyhee Produce (Parma, Idaho): The two largest independent operators. Owyhee works with grower partners across 1,600+ acres; if you're in the Treasure Valley region, a packing agreement with either operation is the fastest route to commercial sales at scale.
• Idaho-Eastern Oregon (IEO) Onion Committee: Coordinates marketing, inspections, and grade standards for the largest US onion production district. Membership is required for growers in the district.
• G&D Produce (Fresno, California): Mid-scale broker with CSA and food-service distribution channels; suitable for 10-30 acre operations selling from cold storage.
• UK: Albert Bartlett and Produce World: The two largest UK vegetable packers with significant onion volumes. Supply agreements require BRC Global Standard food safety accreditation.

Licences & Compliance Requirements for Onion Farmers

Onion farming sits at the intersection of agricultural regulation (food safety, environmental compliance, labour law) and produce marketing standards (grade standards, phytosanitary requirements). The specific licences and certifications you need depend on your scale, selling channel, and geography. Below is the practical checklist for US, UK, and international operators.

United States

• USDA AMS Grade Standards (U.S. No. 1, No. 2, Commercial): Compliance is required for interstate commerce under the Agricultural Marketing Act. No registration cost; inspections are triggered by buyer or shipper requirements and cost $15-$50/lot. The USDA AMS sets separate standards for storage onions and boilers/picklers. (USDA AMS grade standards)
• USDA GAP (Good Agricultural Practices) Certification: Required by most wholesale buyers, food service distributors, and supermarket supply chains. Audit fee: $500-$1,500 depending on operation size. Timeline: 4-8 weeks from initial application.
• FDA FSMA Produce Safety Rule: Applies to farms with over $25,000 average annual produce sales. Covers agricultural water testing, worker hygiene, and equipment sanitation. FDA training courses cost approximately $200. Qualified Exempt status available for farms below the $25,000 threshold selling direct to consumers.
• State Department of Agriculture Registration: Idaho, Oregon, and Washington all require commercial grower registration. Cost: $50-$500 depending on acreage. Timeline: 2-6 weeks.
• Idaho-Eastern Oregon Onion Committee Membership: Mandatory for commercial growers within the IEO production district. Annual assessment based on production volume; provides access to cooperative marketing programmes and grade inspection services.

United Kingdom

• Food Business Registration: Mandatory under EC Regulation 852/2004 (retained in UK law). Free, must be submitted to your local authority Environmental Health department at least 28 days before first trading. Required for any operation selling direct to consumers, wholesale buyers, or processors.
• GLAA (Gangmasters and Labour Abuse Authority) Compliance: UK growers using contract labour for harvest operations must only engage GLAA-licensed gangmasters under the Gangmasters and Labour Abuse Authority Act 2004. Non-compliance carries criminal penalties. The GLAA licence register is searchable at glaa.gov.uk, check every labour contractor before engagement.
• Plant Passport Scheme (commercial propagation/sale of allium seeds): Required for commercial movement of Allium seed under the Plant Health (England) Order 2015. Issued by APHA after phytosanitary inspection. Registration fee varies; inspections are ongoing.
• Cross Compliance / UK Good Agricultural and Environmental Conditions (GAEC): Mandatory for Basic Payment Scheme recipients. Annual declaration to the Rural Payments Agency covering soil management, water quality protection, and field margin maintenance. No direct cost; non-compliance triggers BPS payment deductions.
• Organic Certification (optional): Required for any claim to organic status. Approved UK bodies include Soil Association (Bristol), Organic Farmers & Growers (OF&G), and Quality Welsh Food Certification. Annual inspection fees: £400-£1,200 depending on business size and certifier.

International, India and EU

India removed its 20% onion export duty on 1 April 2025, per the Government of India Ministry of Agriculture announcement. Onion exports now proceed without Minimum Export Price restrictions, re-opening global supply. For UK and EU buyers sourcing from Indian growers, APEDA phytosanitary certification and FSSAI maximum residue limit compliance are required, EU pesticide MRLs under EC Regulation 396/2005 are stricter than US limits on several chemicals commonly used in Indian production.

For EU-based growers and exporters, GlobalG.A.P. certification is near-mandatory for supermarket supply chains. The Netherlands is the world's largest onion exporter, Dutch growers operate under EU Plant Passport, integrated pest management requirements, and strict Codex Alimentarius MRL standards. UK growers targeting EU customers post-Brexit must comply with EU Phytosanitary Certificate requirements for Allium spp.

Revenue Model & Per-Acre Economics

Onion farming revenue is driven by three variables: yield per acre, selling price per pound (or per cwt), and selling channel. Most competitors' guides focus on one of these in isolation. The number that actually drives business plan viability is the interaction between all three, and specifically, whether your channel mix gives you enough price protection to survive the years when wholesale markets crash.

US wholesale onion prices ranged from under $12 to over $30 per 50-lb bag between 2020 and 2024, a 150%+ swing. A 25-acre operation selling 100% wholesale at the low end of that range would generate $210,000 gross revenue; at the high end, $525,000. That spread is the entire difference between a profitable business and a loss-making one at the same cost base.

Unit Economics, 25-Acre Worked Example

The following model is based on a 25-acre conventional yellow onion operation in Treasure Valley, Idaho, using USDA NASS yield data and representative 2023-2024 price ranges.

Channel Mix Matters More Than Yield

The same 1,000,000-lb crop at different price points tells entirely different stories:

• 100% wholesale broker at $0.25/lb: $250,000 gross revenue. After $162,500 in operating costs, net $87,500, 35% margin.
• 70% wholesale / 30% direct-to-retail at $0.55/lb (direct portion): $341,500 blended gross. Net approximately $179,000, 52% gross margin.
• Certified organic, 100% wholesale at $0.60/lb: $600,000 gross, but operating costs 30-40% higher due to certification, lower yields, and premium input management. Net approximately $240,000, 40% margin.

The plan should also model the price floor scenario: what happens to cash flow if wholesale prices drop to the 2022 low of $12/50-lb bag ($0.24/lb)? That single stress test reveals whether the business can service its debt, pay its rent, and survive a bad-price year without requiring emergency capital. Most SBA lenders now require this analysis explicitly.

Additional Revenue Streams

• Premium variety premiums: Walla Walla Sweet (WA), Vidalia (GA), and certified sweet varieties command $0.60-$1.20/lb retail, three to four times the commodity wholesale price. Protected designation status (e.g. Vidalia is limited to 13 Georgia counties) creates a true moat for qualifying growers.
• Direct-to-consumer and farmers' markets: 5-15 acres producing for direct-to-consumer channels at $0.70-$1.00/lb can generate more net income than 50 acres sold to a commodity broker. Higher labour cost is the offset.
• CSA box supply agreements: Regional CSA networks (Boston Organics, Farmigo network operators, Riverford in the UK) offer 12-26 week guaranteed purchase contracts at above-commodity prices, ideal for planning cash flow in year one.
• Dehydrator and processor contracts: Operations near food-processing clusters (Ohio, California's Central Valley) can negotiate dehydrator contracts with processors like Basic American Foods or Gills Onions at fixed volumes and prices, eliminating wholesale price exposure.

For related agricultural planning resources, see our vegetable farming business plan and garlic farming business plan template, which cover comparable allium-crop economics with separate regulatory and market context.

The Onion Farming Market in 2025-2026

The United States produced 73.1 million cwt (hundredweight) of onions in 2023, with a farm-gate value of $1.51 billion, according to the USDA NASS Vegetables Summary released February 2025. That makes onions the third-most-valuable fresh vegetable crop in the US after potatoes and tomatoes, a position it has held consistently for more than two decades.

US Regional Production Landscape

The Pacific Northwest, specifically the Idaho-Eastern Oregon Treasure Valley and Washington's Columbia Basin, is the dominant US onion production region, accounting for over half of national output. Washington's 2024 production value of $477 million was up 7% year-on-year, Idaho's $205 million was up 25%, and Oregon's $260 million was up 10%, per USDA NASS data from Capital Press (February 2025).

Other significant production regions include the San Joaquin Valley (California, short-day spring crop), the Rio Grande Valley (Texas, early short-day crop harvested March-May), and the Vidalia production zone in southeastern Georgia (13 counties with protected designation status for sweet onions). Georgia's Vidalia onion is the only US vegetable with a federal marketing order limiting commercial use of the name to certified growers within the designated zone.

UK and European Context

The UK grows approximately 300,000-350,000 tonnes of bulb onions annually, primarily in Lincolnshire, East Anglia, and Kent. The Netherlands exports over 1 million tonnes per year, making it by far the world's largest onion exporter, Dutch growers benefit from flat peat-based soils, advanced precision agriculture infrastructure, and direct access to EU logistics networks. UK growers post-Brexit face a phytosanitary certificate requirement for EU-bound shipments that did not exist pre-2021.

Globally, India is the world's second-largest onion producer and largest exporter when export policy is permissive. India's removal of the 20% onion export duty on 1 April 2025 re-opened global supply after a period of restriction, a signal that global wholesale prices may face modest downward pressure in the 2025-2026 season as Indian volumes return to international markets. UK and EU importers watching the India-market dynamic should factor this into their procurement planning. See the Government of India PIB press release at pib.gov.in for the policy text.

Demand Drivers

Onion is one of the three most universally consumed vegetables globally (alongside garlic and tomatoes), annual US per-capita consumption averages approximately 20 lbs. Demand is structurally stable, driven by its position as a foundational cooking ingredient across virtually every cuisine. Premium-positioned sub-segments are growing faster: organic onions, sweet varieties, red onions for salad use, and dehydrated onion flakes for the food-processing sector. The food-processing segment (dehydration, pickling, fresh-cut) now accounts for approximately 20-25% of US production volume and provides growers with fixed-price contract stability unavailable in fresh wholesale markets.

The onion farming sector also benefits from relatively low import substitution risk compared to other produce categories: onions are a bulky, perishable commodity where freight costs limit the competitiveness of distant imports for domestic fresh markets, particularly for same-day or short-lead-time foodservice and retail buyers.

Six Mistakes That Kill New Onion Farms

Most first-year onion farms fail not because of bad growing, they fail because of preventable decisions made before the first seed is in the ground. Here are the six errors we see most often in the business plans and post-mortems of operations that didn't make it past year two.

1. Planting the Wrong Variety for Your Latitude

Onion bulb formation is triggered by day length. Short-day varieties (Vidalia, Texas 1015Y, Granex) initiate bulbing when days reach 11-12 hours, they're grown in southern states from fall to spring. Long-day varieties (Walla Walla, Yellow Sweetie, Pontiac) need 14-16 hours and are the standard for the Pacific Northwest and UK. Plant a short-day variety in Idaho and it will bulb prematurely at pencil-width; plant a long-day variety in Georgia and it will never bulb at all. Seed company variety trials are publicly available for all major production regions, there is no excuse for a variety mismatch, yet it appears in roughly one in four first-year farm plans we review.

2. Skipping the Soil pH Test

Onions need a soil pH of 6.0 to 7.0. Below 6.0, manganese toxicity and fusarium basal rot incidence increase sharply; above 7.2, iron chlorosis suppresses growth. A soil test costs $15-$30 per sample and 7-10 days. Lime applications to correct pH must be incorporated at least 3-4 months before planting. Growers who skip this step and then diagnose the yield problem at harvest have already lost the season. The test also reveals whether organic matter, phosphorus, and potassium levels support the 200-250 lbs/acre of nitrogen that high-yield onion production requires.

3. Under-Budgeting for Post-Harvest Curing

Onions that reach cold storage with incompletely dried necks develop botrytis neck rot, a fungal disease that can destroy 20-30% of stored volume. Proper curing requires 3-4 weeks at 90-95°F with continuous forced-air circulation to desiccate the outer scale layers. Growers who can't afford or access a curing facility and instead put onions directly into cold storage consistently report 15-30% storage losses in their first year. Georgia researchers reported some growers discarding up to 30% of crop due to bacterial and fungal storage rots (University of Georgia CAES field report). The curing shed budget line is non-negotiable.

4. Single-Buyer Dependence with No Price Floor

US wholesale onion prices ranged from under $12 to over $30 per 50-lb bag between 2020 and 2024, a swing that makes the difference between a profitable season and a cash-flow crisis on a 25-acre operation. Growers selling 100% of production through one broker with no floor price contract have zero protection against the low end of that range. Processing contracts (fixed price, forward-sold volume), CSA box supply agreements, and direct-retail relationships at 10-20% of volume each provide meaningful downside protection. The business plan should model revenue at both the low-end wholesale price and the expected blended price.

5. Ignoring FSMA Produce Safety Rule Obligations

Once gross produce sales exceed $25,000 per year, the FDA's FSMA Produce Safety Rule requires agricultural water testing, worker health and hygiene training, equipment sanitation records, and harvest supervisor documentation. Many first-year growers assume they are too small to be covered, and are caught out by their packer's food-safety audit or a buyer's GFSI certification requirement. The FSMA training course runs approximately $200 and is available through state cooperative extension services. Non-compliance disqualifies you from most commercial buyers and voids your USDA GAP certification.

6. Harvesting Before the Tops Have Fallen

Optimum harvest timing is when 50-80% of the tops have naturally fallen or bent, at this point the bulbs are physiologically mature and the outer scales have begun to dry. Growers who harvest early (driven by cash flow pressure or weather concerns) get onions with immature, wet necks that store poorly and grade down at packing. Early harvest is estimated to cost growers 10-15% of potential revenue through grade reduction and storage losses. The business plan should include a crop diary template that tracks the top-fall progression against projected harvest dates.

Sample Business Plan Extract, What the Final Document Looks Like

Here is a representative extract from an onion farming business plan written by our team, showing the level of specificity that lenders and investors expect:

What the Onion Farming Business Plan Template Includes

Every Avvale business plan template comes pre-structured for the specific industry, no blank pages, no generic filler. The onion farming version includes these sections, each with instructional guidance notes and worked examples:

• Executive Summary, Farm concept, total capital required, Year 1 revenue and margin projections, and the one-paragraph lender pitch
• Company Overview, Legal structure (LLC, partnership, sole trader), ownership, farm location, and founding narrative
• Farm Operations Plan, Acreage, variety selection, planting calendar, irrigation system, harvest method, and post-harvest handling
• Market Analysis, US/UK production data, regional price trends, target customer segments (wholesale, foodservice, direct-to-consumer), and competitive positioning
• Sales and Marketing Plan, Channel mix strategy, broker and packer relationship plan, direct-to-consumer tactics, and pricing approach by channel
• Regulatory & Compliance Section, USDA GAP, FSMA, state registration, UK food business registration, GLAA, organic certification as applicable
• Staffing and Labour Plan, Owner-operator role, seasonal labour requirements by task, wage budget, and GLAA compliance framework for UK operations
• Management Team, Founder background, advisory board, agronomic consultant arrangements

The optional Financial Forecast add-on (included in our $300/£250 and $1,000/£800 packages) provides a 5-year Excel model covering: per-acre yield projections, monthly cash flow, annual income statement, capital expenditure schedule, debt-service coverage ratio, and SBA-formatted startup capital table. The forecast is built with scenario inputs, low, base, and high price, so you can present lenders with a stress-tested plan rather than a single-scenario projection.

See also our broader market research service for onion farming, our consultants pull live USDA NASS data, regional price histories, and competitor analysis for your specific geography to supplement the template.

Frequently Asked Questions About Onion Farming Business Plans