China: Shandong pomelo prices fall off a cliff

At the end of March and through early April, pomelo prices in Yinan county, Shandong province, were significantly lower. Compared to the period of the Chinese New Year, the prices of pomelos have slumped and dropped by 50%. As an introduced variety from South China, pomelo prices in Yinan county had a strong market performance up to 2016. However, after that, the pomelo price began to drop and kept on declining year after year.

First of all, pomelos have been selling well on the Northern China market in recent years. So the plantations expanded and production shot up.

Secondly, some fruit distributors over-estimated the market demand, and went to Southern China production areas to source the fruit, resulting in large volumes flooding the northern market, and causing a price slump.

Thirdly, as consumer demands diversified, the pomelo market faded and prices fell.

Fourthly, with the rapid development of e-commerce and new logistics industries, consumers now have more choices to purchase non-locally produced fruits like pomelo.

Fifthly, there is no authoritative information sharing platform for fruit plantations and distribution. There is a general lack of market information communication. If a fruit variety is profitable, everyone will follow suit, causing the price to drop and leading to losses for everyone

Sixthly, as the end of pomelo season approaches and temperatures rise, the cost of refrigerated storage increases, along with the risk of rot, so that dealers are forced to sell their produce at knockdown prices.