China is the main supplier of garlic worldwide, and Jinxiang County is the largest garlic processing and sales center in China; therefore this place reflects the true market changes of garlic.
Facing such a drastic leap of the garlic price, a journalist from the China News Service interviewed Mr. Yang Guihua, the secretary of China Garlic Industry Alliance and the vice director of the Jinxiang Garlic Industry Association. He said very frankly that the primary factor that impacted the garlic price is the reduction of production volume. In general, garlic is planted in October and harvested the following May. During the winter season of 2016, Shandong province suffered a severe cold wave and, as a consequence, the garlic production volume decreased significantly. At this moment the garlic stock level in Jinxiang County is around 1.255 million tons, around 285.000 tons less than that of last year.
Besides the weather factor, the capital involvement also impacted the garlic price. According to Mr. Yang, the promising returns attracted too much investment in garlic, that's why the dealers are very active in garlic purchase, which further pushed up the garlic price increase.
According to market analysis from the International Garlic Trade Website, the Jinxiang garlic trading price was 15.8 Yuan/kilo in January 4th, though some new stocks came to the market, but the supply was still tight, so the buyers were quite active in buying in. This continous garlic price increase also impacted the garlic exports.
Based on these statistics, China exported around 105.800 tons of fresh or frozen garlic, which is around 7.09% less that that of last year. Among all the export volume, 75,900 tons are from Shandong province. In terms of export revenue, the amount goes up to 199,000,000 US dollars, an increase of 50.47%. And the majority of this garlic is exported to Indonesia, Vietnam, Malaysia, Pakistan, Russia etc.
Shandong province is the major area for agricultural exports, and garlic is the largest export variety, accounting for around one third of its total vegetable exports. According to Mr. Yang, the daily garlic export in Jinxiang county remains at around 5,000 to 7,000 tons. Although its total export volume decreased a bit, but the demand of its big clients from Indonesia keeps increasing.
A professor of Economics from Shandong University believes that multiple factors resulted in such a price surge. Firstly, the cold wave in China led to price fluctuations of agricultural products. Secondly, the market information in China is not very open to agricultural growers and dealers, their lack of understanding of market trends brought more opportunities on board. Therefore he suggests that the government should not only play a role in promoting the production level, but should also build a transparent information channel for agriculture products.
Source: China News Service
Shandong province is the major area for agricultural exports, and garlic is the largest export variety, accounting for around one third of its total vegetable exports. According to Mr. Yang, the daily garlic export in Jinxiang county remains at around 5,000 to 7,000 tons. Although its total export volume decreased a bit, but the demand of its big clients from Indonesia keeps increasing.
A professor of Economics from Shandong University believes that multiple factors resulted in such a price surge. Firstly, the cold wave in China led to price fluctuations of agricultural products. Secondly, the market information in China is not very open to agricultural growers and dealers, their lack of understanding of market trends brought more opportunities on board. Therefore he suggests that the government should not only play a role in promoting the production level, but should also build a transparent information channel for agriculture products.
Source: China News Service