The vegetable market has recently enjoyed an upward price trend. That is mainly the result of heavy rainfall in late July and early August. Throughout the country the growth and distribution of vegetables was hindered by these extreme weather conditions. The market supply volume naturally declined, and so the price went up. This trend was the most obvious in the onion market. Most of the onion supply volume currently comes from production areas in Gansu.
"Not only did the production volume of Gansu onions grow in comparison with last year, but so did the price. The purchase price in production areas is now around 0.7 yuan [0.11 USD] per 0.5 kg. And the price of top-quality onions can be as high as 0.8 yuan [0.12 USD] per 0.5 kg. That is more than 75% higher than the price of 0.4 yuan [0.06 USD] per 0.5 kg around this time last year." This is according to Mr. Zhang Jinhua of Gansu Jinhua Agricultural Development Co., Ltd.
Mr. Zhang continued: "This upward trend is primarily because extreme weather conditions hindered distribution from production areas to markets, but the overall increase in demand from overseas markets plays a role as well. Demand for export is much higher than in previous years. India, one of the largest onion exporters, temporarily halted their onion export to avoid a shortage in the domestic market. Buyers from Europe and Southeast Asia gradually shifted their attention to China. In addition, many countries are now slowly loosening Covid-19 prevention measures, which is another stimulus for the onion export market. As consumers start to eat out again, and the restaurant business begins to recover, so demand from this industry will grow again. That is another reason for the rising price of onions."
In the end, the onion export market is doing quite well, but just like all the other agricultural export products, onions also face the challenge of a rising shipping cost and a shortage of shipping containers. Mr. Zhang explained: "Shipping prices rose at an insane pace earlier this year, but that is no longer the case. The pace is almost normal and overseas clients have begun to get used to this price. They take the fluctuations of distribution costs into consideration when they place orders. The shortage of shipping containers is a bigger headache. These circumstances are outside of anyone's control. We also have clients who, on occasion, cancel their orders because there are no shipping containers."
For more information:
Mr. Zhang Jinhua
Gansu Jinhua Agricultural Development Co., Ltd.
Tel.: +86 151 9340 5179