China : Limited garlic price increase prior to Chinese New Year
Garlic market conditions were worrisome last year around this time. Conditions are slightly better this year. The price rises and falls in turn. Will the market improve in the period leading up to New Year and Chinese New Year? December is already the 4th month in the sales period of garlic from refrigerated storage. Supply from refrigerated storage exceeds demand, as it did last year, but traders with storage are more willing to sell than they were last year.
The reasons behind the garlic price fluctuations in November were numerous. First, the overall surface area devoted to garlic plantation diminished this year. Traders with stock therefore waited longer before they began their sales season. Second, traders paid lower prices for their garlic purchases this year. Third, the retail season of garlic from refrigerated storage was long this year. December is only the 4th month in this season, there are 5 months left.
The purchase volume of garlic is expected to grow in the period leading up to New Year and Chinese New Year. Experienced traders are preparing for this busy period. The margin for garlic price increase in the common agricultural markets is limited in this period. Although the garlic export volume in the first 9 months of this year was larger than last year in the same period, there is a limit to the growth of the garlic volume that entered refrigerated storage this year. Many garlic retailers in domestic wholesale markets have little confidence in the price increase later this season. Most of them purchase according to market developments. At the same time, some traders with storage keep a close watch on the reduction of the overall surface area devoted to garlic plantation in autumn this year.