Lost output leads to higher prices for garlic
"In the near future, garlic will continue to sell well on the market, although its price is repeatedly reaching new heights. When compared to the same period last year, garlic had to withstand low temperatures for a longer period. The garlic output all over the country was reduced by approximately 25%, and the differences for the export price and domestic market price were 70% and 90% respectively." says Yang Guotai, manager of a trading company in Shandong province.
"The growth of garlic starts every year at the end of September and ends at the beginning of June. The peak season for sales is between June and September, since supplies for the whole year have to be bought. Our company was established in 1992 and produces and processes garlic. The base of operations is situated in the 'Garlic Town' of China, Jinxiang. We directly control 66.7 hectares of acres and reach a yearly output of 1100 tons."
Supply does not meet demand for garlic
"At the present stage, 80% of our high quality garlic is exported to Europe and Japan, with Europe taking the lion's share. From the exporter's perspective, we see that the current export price is approximately 2500 USD a ton. If we compare this to the same period last year, we see it has increased by 70%. However, the amount of exports has gone up by about 30%. Even so, we have remarked that the USA, Europe, South East Asian and other foreign markets still have 15-20% demand which hasn't been met yet. The remaining 20% was sold to markets all over China. The current market price is approximately 90% higher than last year's. The stocks this year are not able to meet both domestic and foreign demand."�
People increase prices for promotion
"Apart from the climate that led to decreased output for garlic, there was also the increase in prices of raw materials. The fact that people arbitrarily increased the price level for garlic on markets is also an important factor. It's still hard to predict what evolutions will happen on the garlic market next season. This is because, although the main reason why prices have increased is due to the forces of supply and demand, also the size of new acres and the behavior of market participants has an impact on the trend of rising garlic prices."
"Our company has been approved by GAP and BRC in 2000. We have our own technology team. The whole year we carry out standardized planting and standardized production. After struggling arduously for many years, we already have a large customer base both domestically and foreign. We hope to work together and cooperate with more international firms in the future, so that high quality garlic from China can go overseas."
Yang Guotai
Shandong Weifang Import & Export Limited Company
Telephone: +86 139 5360 6586
Fax: +86 536 8896 706
www.successfood.cn