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Chinese garlic export declines

[Abstract]:

Shipping price increased tenfold

China has been the largest manufacturer in the world for 11 years in a row. And since the outbreak of Covid-19 in December 2019, the world has come to rely more on Chinese exports than ever before. China has been relatively efficient in controlling the outbreak of Covid-19, and so the containers continue to ship out from China, but while the rest of the world struggles with the pandemic, only a limited number of shipping containers returns.

China suffers from a 'container shortage'. All the containers are stacked on the other ends of shipping routes and ports have to deal with backlogs. For Chinese garlic exporters this situation means that shipping containers are nearly impossible to find. In addition, custom clearance procedures are stricter and take more time during the pandemic, which slows down the rate at which port authorities process shipping containers. Furthermore, because of the pandemic there is a shortage of workers, trucks, and drivers, which further pushes the shipping price up.

The world's largest garlic importers are Indonesia, Brazil, Malaysia, Vietnam, the USA, Bangladesh, Russia, Pakistan, and Saudi Arabia. These 9 countries are responsible for 56.77% of the global garlic import volume. The main garlic export markets in July were Indonesia, Vietnam, Malaysia, the USA, Thailand, the Philippines, and UAE. Indonesia imported 28.34% of the Chinese garlic export volume in July, Vietnam imported 9.04%, and Malaysia imported 7.35%. The Indonesian market absorbed one third of the Chinese garlic export volume. However, there are repeated outbreaks of Covid-19 in Southeast Asia, which creates obstacles for garlic export to Indonesia, Vietnam, and Malaysia.

Chinese garlic export declines

The profit margin in the agricultural market is relatively small compared to other markets. And agricultural products are not easily stored. The difficulty in securing shipping containers and the high shipping price both put a lot of pressure on exporters of agricultural products. The order volume remains small under these conditions, and some Chinese garlic exporters have even been forced to cancel orders.

The Chinese export volume of fresh and cold storage garlic was around 165,401.2 tons in July, 2021. The accumulative export volume was 1,244,084.63 tons. The export value was 169,070,800 USD, and the accumulative export value was 971,699,792 USD. The average export price was 1,022.19 USD per ton, and the accumulative average price was 1,141 USD per ton. The export volume increased by 5.82% compared to June, but declined by 24.5% compared to July last year. The accumulative export volume declined by 23.12% compared to the same period last year.

Impact of garlic export on the domestic garlic market

The period in which buyers purchase garlic to stock their warehouses is almost over in September. And the trade in cold storage garlic takes off. The cost price of cold storage garlic is much higher than the cost price of dried garlic. The average price of garlic in September is expected to reach 2.73 yuan [0.42 USD] per 0.5 kg. The National Day on the first of October may stimulate the domestic garlic market. The long-term decline of garlic export will put pressure on the domestic market. However, since garlic is a seasoning, there is not a lot of flexibility in consumer demand. If supply exceeds demand, then the price will fall.

Chinese Garlic to Republic of Trinidad and Tobago by TRANS-HIGH

Chinese garlic export declines and domestic consumption remains weak