The domestic market price of Chinese garlic has recently been growing weaker and overseas market demand is also insufficient to keep the price up. The relationship between supply and demand is out of balance. Christian, a spokesperson for Shandong Fortunate Farm Trade Co., Ltd. recently talked about current conditions in the Chinese garlic market.
The volume of dried garlic in storage is the largest in recent history, but industry specialists disagree on the exact figure. Numbers vary between 4.08 and 4.80 million tons. "I base my estimate on the overall surface area devoted to garlic plantation in China, and I think the actual volume in storage is around 4.3 million tons. The volume of garlic in cold storage is more than sufficient, so buyers are not too enthusiastic. They only purchase based on current demand. And processing factories do not create much demand either. While farmers are busy planting new garlic, many processing factories temporarily shut down," said Christian.
"The garlic price has grown weaker since warehouses opened their doors and started selling garlic from storage. Garlic cloves from storage currently cost around 1.75 yuan [0.26 USD] per 0.5 kg. Common quality garlic from storage currently costs 1.85 yuan [0.27 USD] per 0.5 kg, while medium-sized garlic costs 1.95 yuan [0.29 USD] per 0.5 kg, and large garlic costs around 2.06-2.18 yuan [0.30-0.32 USD] per 0.5 kg. The price per ton has dropped by 300 yuan [44.18 USD] since its peak earlier this year."
Garlic is no longer just a seasoning product, but a commercial product with a financial function. This season, however, because of developments in the general economic environment, fewer traders speculate in the garlic market. "As for export, the export volume to overseas markets has not significantly increased in comparison with the same period last year. The garlic markets in the Middle East and Southeast Asia have slowed down as a result of the Covid-19 pandemic. Even their domestic market prices do not go up, so exporters are unable to make a profit, and importers do not earn anything either. Some even make a loss."
"Industry specialists expect the overall surface area devoted to garlic plantation to decline because the garlic price is quite low, but current planting activity in production areas shows no such development. The chances are small that the overall surface area devoted to garlic plantation will significantly decline."
Shandong Fortunate Farm Trade Co., Ltd. is a specialized garlic exporter based in Jinxiang, China. "The Chinese export volume of garlic accounts for about 70%-80% of the global export volume of garlic. That is why conditions in the Chinese garlic market set the tone for conditions in the international garlic market. It is therefore crucial that traders keep a close eye on Chinese market conditions. We hope to share more than just our top-quality garlic. We also wish to share our view on the Chinese garlic market and offer our clients the best service possible."
For more information:
Shandong Fortunate Farm Trade Co., Ltd.
Tel.: +86 15265793002
WhatsApp: +86 15265793002