The average wholesale price of chilli peppers in the Xinfadi Market is 6.5 yuan [0.97 USD] per 0.5 kg. That is a price increase of 182.6% in comparison with the price of 2.3 yuan [0.34 USD] on January 1st, 2019. The Ministry of Agriculture analysis of the agricultural supply chain shows that there are three reasons for this development. This is according to chief analyst Zhang Jing.
1. The weather in spring was unfavorable. Production areas throughout China suffered from rain and snow in February. Production areas in south China in particular had overcast and rainy weather and limited sunshine. Furthermore, there were frequent small "cold currents" that slowed down chilli pepper production throughout China around Chinese Spring Festival [February 5th, 2019].
2. Major production areas in Shandong and Henan suffered from typhoons. In addition, the overall surface area devoted to chilli pepper production decreased, and the price therefore increased. Production areas in the south then greatly expanded the surface area devoted to chilli pepper plantation. The price of chilli peppers from last winter then dropped. However, farmers did not carefully manage the pepper plantation and overall supply is tight.
3. Price fluctuations are large. The average wholesale price in the first quarter of 2019 was 23.3% lower than in the first quarter of 2018, and around 14.5% lower than the average wholesale price in the last 5 years. There is certainly room for the price to increase further. The price of chilli peppers is expected to reach its peak in April and May.
Source: ce.cn