After a period where small adjustments were seen in the ginger market, there has been some new developments in the price over recent days. Trading activity has increased compared with a few days ago, and prices in various production areas have increased by varying degrees.
At present, purchasers are not as active in the production areas as they were some time ago, and demand in the domestic market is lacking. The wholesale price in many markets is lower than in production areas, and some traders are selling products at a loss. As prices are at a high level and no one is sure whether prices will drop in the future, wholesalers choose to wait and digest their current stock or mainly make purchases based on rigid demand and rarely make purchases in large quantities.
There are currently a lot of rumors going around in major production areas that the stock is running low, which has boosted farmers’ confidence and price expectations and consequently led to continuous lower-than-usual supply in trading markets. This is also one of the reasons for prices to increase over recent days.
In addition, whether it was last year or this year, farmers tend not to make mass shipments after a dip in the price, so the supply volume is relatively even and prices can be maintained at a relatively normal range with no linear decline after a spike in prices.
Whether the purchases made by traders of ginger in storage can trigger a second wave of increase in prices remains to be seen. In general, if there is no new capital from the storage ginger business being injected, there is currently no significant boost from the demand side.