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Chinese garlic exports lag

Lingering supplies from last year's crop have kept prices in check for garlic from China. With prices not being as attractive as in the past, exports this year trail those from last season. Good European crops have also contributed to the slow pace of Chinese exports.

“Europe, in general, has had domestic markets with good yields,” said Peter Meszaros of Role 2003 in Hungary. Role imports garlic from China and distributes it throughout Europe, but big local production this year has slowed supplies from China by about two months. While imports have increased as of late, they still lag behind those from last year.

“The stock of garlic in Europe is getting low now, so demand for garlic from China should increase,” said Meszaros. “As always, the biggest competition comes from Spain.” While Spanish product is usually priced lower than Chinese garlic, Meszaros thinks that Spanish suppliers will increase their prices as supplies throughout Europe shrink. That would make Chinese garlic competitive in Europe once more. As for supplies in China, there have been complications this year.

“The stock of garlic in China is a little less than what it was at this time last year,” said Meszaros. “However, there is still garlic from the old crop.” The presence of that old garlic has frozen prices, and those low prices have enticed few participants into the export market. As a result, the amount of garlic exported this season is less than what was exported by this time last year.
Coupled with low demand, the remnants from last season's crop have had other effects. Those growers who still have supplies from last year are focusing less on new production, so garlic production next year could dip. Low prices from excess demand has also led to many speculators simply not trading until the market gets better.

“Chinese exporters are waiting for better days to come,” said Meszaros. “They're keeping their stocks in cold storage until then, perhaps January.” Good harvests in Europe have also edged out Chinese imports there, and demand for Chinese garlic has waned in South America. That has further limited the prospects for China's garlic exporters this season
For more information:

Peter Meszaros
ROLE 2003 Kft
Tel.: +36 1 431 0455
Fax: + 36 1 260 0970
Author: Carlos Nunez / Yzza Ibrahim

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