Relevant data shows that, as a consequence of the appreciation of the Chinese yuan, the Chinese garlic export volume declined by 1.83% in the first quarter of 2021 compared to the same period in the previous year. China exported around 510,000-610,000 tons of garlic in the period between January and April this year, while last year in the same period the garlic export volume reached 520,000-570,000 tons. Data from May has not yet been announced, but predictions do not look good. The main reason for the decline of garlic export in the first quarter is the rising price of garlic. The current price of regular mixed garlic is around 4.6-5 yuan [0.71-0.77 USD] per kg, while the same garlic only cost around 2-2.2 yuan [0.31-0.34 USD] per kg in June last year. That is an increase of 128.57%. The high price puts enormous pressure on Chinese garlic export.
"The appreciation of the Chinese yuan has an impact on Chinese garlic export, but our analysis shows that the impact is relatively small. The Chinese yuan is still rising, but the increase is much slower than in April and May. The peak period of Chinese garlic export officially began in early June, but the export volume was much smaller than last year because the price of shipping is extraordinarily high. In the end, the price increase of export garlic can not make up for the decline in export volume. That is why the overall export value decreased in comparison to last year." This is according to Annie Chen, sales manager at Jining Fenduni Foodstuff Co., Ltd.
The cost of planting garlic greatly increased in 2021. This includes land rent, agricultural chemicals, fertilizers, and labor cost. That is why the price of Chinese garlic went up this year. Export companies face the rising cost of raw material, the increasing cost of shipping, and the appreciation of the Chinese yuan. In addition, the Covid-19 pandemic still creates obstacles for global distribution, and the shortage of shipping containers further drives the price of shipping to new heights. Export companies see their profit margin grow smaller every day.
According to Ms. Annie Chen: "Many countries across the globe have significantly slowed down the spread of Covid-19. Some countries are already relaxing their lockdown measures to some degree, especially in Europe. This opens up room for market demand. Initially the market price of garlic was extremely high and clients had no way to deal with this situation, but after a period of market adjustments, clients have now adapted to the new price. That is why the export volume is now slowly expanding again."
Jining Fenduni Foodstuff Co., Ltd. currently exports garlic primarily to Africa, the Middle East, and Europe. The company exports white garlic, primarily small white garlic, and purple garlic, primarily large purple garlic.
For more information:
Ms. Annie Chen - Sales manager
Jining Fenduni Foodstuff Co., Ltd.
Skype ID: fenduni5
WhatsApp: + 86 18678710377
WeChat: + 86 18678710377
Viber: + 86 18678710377
E-mail: annie@china-garlic.com
Website: www.garlics.com
Website: www.china-garlic.com