Ginger prices in China have increased sharply during 2013, and the trend is forecast to continue heading into 2014 as a range of factors combine to put pressure on supplies.
Chinese ginger supplies have been impacted this year by a lower production for the 2012/13 crop, which was harvested in October/November 2012. Part of that was down to reduced plantings in 2012, after growers suffered heavy losses due to oversupply in the previous seasons, while cold weather further cut into volumes.
“Cold weather during the 2012 growing season impacted yields and in some cases quality,” explains Jim Provost, president of US-based importer I Love Produce. “Specifically, the cold weather made it more difficult to cure the ginger.”
While supplies are well down, China’s increasingly hungry domestic consumer market has driven up demand, sending prices soaring. According to Provost, prices have increased by more than 50 per cent during the 2013 calendar year, and he expects that trend to continue due to another below par production year in 2013.
“The 2013 harvest is now under way in China and it’s expected to yield 30 per cent less ginger than originally forecast due to a very wet spring and a very dry fall (autumn),” said Provost. “We expect very little carryover stock going into 2014 and prices are expected to remain at current levels at the very minimum with some possible upward pressure during the year.”
High ginger prices in China have been making national news headlines over the past week, with CNTV reporting that the retail price has climbed as high as Yn20 (US$3.23) per kg (US$1.50 per lb). According to China’s Ministry of Commerce, the wholesale price of ginger jumped 7.6 per cent in the week ending 20 October compared with the previous week.
“The [domestic] price is currently better than the US market, especially when you take into account that they [suppliers] have to wash it and pack it properly for the US market,” says Provost.
While North America remains a key market for Chinese ginger, Provost says South American exporting countries have been increasing their production as China’s prices have increased.
I Love Produce has been importing ginger to the US and Canada from Peru, working directly with farmers, but in the future Provost believes there could be opportunities to export ginger from Peru into Asian markets traditionally supplied by China, such as Japan and Singapore.
“As far as exporting to Asia is concerned, that will take time for the buyer to move away from traditional channels. Also, there are protocols to determine. It could happen in the future if this trend continues, as I predict it will,” said Provost.
