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Weak consumption and slow sales

Will apple prices in China fall again around Spring Festival?

The outlook of this year's produce market has been challenging, and apple sales have been very slow. Some companies reported a sales speed of at least 30-50% slower year-on-year, while some even reported 70%. At present, supplies on the market are mainly products owned by farmers. After the New Year's Day, prices dropped about 0.2 yuan per half a kilo, and recently dropped another 0.2 yuan.

There are a few reasons for this:

(1) Apple production continues to increase this year, but the quality has declined. Production in Shandong has declined.

(2) The stock volume across China is high, while merchants are not active in purchasing. Stocks mainly belong to farmers who stockpile their own crops.

(3) Apple consumption is sluggish this year. On the one hand, consumption has been restrained by the higher purchase price, on the other hand, other fruits are cheaper. Moreover, due to the impact of urban management in large and medium-sized cities, fruit sales channels have shrunk, leading to a decline in consumption.

In summary, if the consumption has not improved significantly before the Spring Festival and sales continue to be slow, it is expected that farmers will rush to sell their stock in large volumes, leading prices to fall sharply. The market will remain weak till May, but if the low prices in this period drive up sales, the stock volume may drop sharply after May, and prices may make a significant recovery, depending on the speed that the stock reduces.

Source: Guoyequan

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