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China: Supply exceeds demand at the garlic market

foodmate 2017-06-07
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Tag: Garlic China

"This year, there were high yields of garlic all over the country. There are two main causes for this. First of all, the flourishing garlic market from 2 years ago excited many garlic farmers which drove them to expand. In 2016, the area used to grow garlic took up 403.333 hectares, but estimates show that this will grow to 473.334 hectares in 2017, an increase of 20%. Secondly, due to good weather throughout last year, conditions were conducive to a healthy and abundant crop," says Guo Wantao, director general of the specialized farmers garlic cultivation cooperative Fangxin in Pizhou city (Jiangsu province).

"In terms of market sales, the opening price this year stood at 0.20 EUR per kilogram. This is more than 65% lower than the 0.3 EUR per kilogram last year. There are three reasons for why the price has reduced so much. First of all, the bumper harvest of garlic gave rise to a market in which supply does not meet demand. The depression on prices is serious. In the meantime, there were also some garlic farmers with little experience in the market that were hesitating for a long time whether to take the risk or to sell their garlic. Furthermore, many farmers invested heavily in their plantations last year and, adding to the instability of the market, the majority of garlic farmers just want to even down their costs as soon as possible. Lastly, intermediaries and harvestors have started articifial promotions to manipulate the market, which also brought about instability in the market to some extent."

"It is still too early to estimate how the later stages of the garlic market will be. In general, the quality of garlic this year is very good. 40% of all garlic has a diameter of more than 6 centimeters. I personally believe that small garlic will not be sold easily. Our fresh garlic here is mainly processed products. Of all garlic harvested within the industry, a part is sold in supermarkets and farmers market. Another 10% is sold on online platforms. When it comes to the sales of garlic, we believe that the responsible departments will give the appropriate support to production to increase the speed at which the products circulate, in order to help the farmers in maximizing their profits. Our cooperative is located in the east of the Jiangsu-Gansu railway and the Grand Canal. We welcome all clients and garlic fanatics to visit and work together."

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