Peru's ginger supplies remains limited despite good demand in their key markets of Europe, the USA and Canada. Leandro Manuel Llacctarimay Figueroa, Sales and Operations Manager from Agroexportaciones Llacta: "The supply in Peru is limited at this time because sowing in 2022 was 60% less compared to 2021, after farmers lost their working capital due to the low prices that occurred in 2020 and 2021."
Leandro Manuel Llacctarimay Figueroa, Sales and Operations Manager from Agroexportaciones Llacta in Peru.
He says that, since the Covid-19 pandemic in 2020 the prices for ginger were very good, causing many people in Peru to jump into the sector. "The population who work in other sectors such as hotels, liquor stores, construction, coffee farmers, pineapple, cassava and others, invested in planting ginger thinking that it would cost the same as during the pandemic. However, it was quite the opposite, since other producing countries planted more ginger, such as Ecuador, Costa Rica, Honduras, Brazil and China."
Manuel explains that other existing producers and exporters planted ginger in response to their overseas customer demands. "More and more new agro-export companies from the north and south of Peru that export mango, avocados, lemon, banana, and garlic are venturing into the export of ginger, driven by the demand for organic ginger from their clients in Europe and North America."
Ginger from Peru grown in the highlands.
He says despite the good demand the price paid for ginger is a factor, given that China has cheaper ginger available, but in Peru they focus on growing and exporting an organic and certified product. "The current demand in Europe, the USA and Canada is good but the price is a factor that determines the market since China has a FOB price of $22 per box of 10 kg and Peru with $50 per box of 13.6 net kg per the condition that it is an organic/ecological product, certified with seals of socio-environmental responsibility."
Manuel says the new 2024 ginger campaign begins in April again. "A few years ago there was good production, since last year the prices offered at the farmer's field were 100 soles for approximately 19 kilos of ginger, compared to the 80 soles for the ginger during the pandemic in 2020. All of Peru's production for export is organic because exports have been made since 2006 with that condition. The ginger season is ending with growth compared to the previous year 2022/23."
Danny Pacheco, international sales manager at Agroexportaciones Llacta S.A.C. says: "All the previously mentioned scenarios of falling production due to the drop in export prices in 2021 and 2022 materialized because ginger is a transitory crop that is quickly harvested; less than twelve months after planting. In this scenario, the kilograms and FOB values exported by Peru fell by -89% and -75% respectively, as well as the number of exporting companies, from 140 to 126 in the 2022 (June) - 2023 (March) campaign.
"However, the 2023 April to March 2024 season for Peru would have a growth of at least 5% in terms of volume and FOB value to be exported, due to the improvement in prices in 2023, the low entry barriers to returning to the crop and supported by the 6% growth in imports of Peru's main market, the USA. It is worth noting that 93% of total U.S. imports (US$ 141 million) came from Peru last year. Likewise, the preference of the world market is for the Criollo variety, due to its intense yellow color, high dosage of gingerol and higher pungency, which is produced mainly in Peru in the organic presentation," concludes Pacheco.
For more information:
Leandro Manuel Llacctarimay Figueroa
Agroexportaciones Llacta S.A.C
Tel: +51 978 001 892
Email: Mllacctarimay@agroexpollacta.com.pe
www.jengibreperu.com
Danny Pacheco Infante
Tel: +51 959 175315
Email: danny.pacheco@agroexpollacta.com.pe