European and U.S. envoys arrived in the city of San Juan, Argentina, to sign the first contracts with garlic producers and the initial outlook is grim: the value proposed for a case (10 kilos) averages U.S. $20.50, 27% less than in the last season when, according to local exporters, the price at this point was of about 28 dollars. Producers have said that, since the production costs them U.S. $26, they are losing money. The European Union and the United States buy nearly 35% of San Juan's white garlic and then Brazil, which hasn't started buying yet, buys most of the rest.
The businessmen who came from France, Spain and the western United States, proposed values that ranged between 18 and 23 dollars. Last season, the price of the calibre 5 box was $18 dollars, the calibre 6 box was at $28, and the largest calibre, 7, was at $33. If the season isn't good there might be a new drop in 2014's planted area.
The European Community has an import system consisting of two licenses: one for December, which governs the shipments in the coming weeks, and another in January for the shipments delivered between February and March. Hence, producers are expecting that prices would increase for the second license. "They are only going to take what they need, that lowers prices. As things stand, nobody is going to balance their budget," said the head of the House of garlic producers, Javier Garcia. Local entrepreneurs want to raise prices by showing that their white garlic is healthy and has a good calibre, however, it's going to be a long shot.
Source: Diariodecuyo.com.ar