Chinese garlic prices remain steady

After an upward surge of Chinese garlic prices that started a couple of years ago, prices have levelled off and held steady. But while the market for garlic is currently good, the lack of rebates and increasing competition abroad has made it more difficult for exporters.

“There are around 500,000-700,000 metric tons of garlic in cold storage,” said Vivien Li of HengFeng. “So currently, garlic stocks in China are larger than demand on the domestic and export markets.” That disparity between supply and demand made for low prices at the start of the season in June, though prices have improved some later in August.

“Prices were quite steady from September through February, and then after the Lunar New Year, from mid-February prices for garlic increased,” said Li. She estimated that prices increased by about $100 to $150 per metric ton. While there have been some fluctuations since then, prices have remained steady from February onwards. But despite good prices, the market for garlic shippers is still fraught with difficulties.

“A big problem now is that we don't have rebates for exporting garlic that we had three years ago. The lack of control in the garlic stock market along with disordered speculation, increases the difficulty for exporters,” said Li. Increased competition from foreign shippers has also squeezed Chinese exporters, and the volatility of the markets has prodded some shippers to branch out from fresh garlic.

“There's big competition when it comes to fresh products,” said Li. “It's a big risk, so our company is now going into fields like processed and dehydrated garlic so we can avoid risk and add value to our products.”

For more information:
Vivien Li
Hengfeng Fresh Produce Co.
Tel: +86 530 8191088
Fax: +86 530 8191288
Email: vivien@hengfengfresh.com
www.hengfengfresh.com