The global ginger market is currently facing challenges, with uncertainties and shortages affecting different regions. As the ginger season transitions, traders are faced with fluctuating prices and varying qualities, causing unpredictability in the Dutch market. Germany, on the other hand, is experiencing undersupply issues due to lower volumes and unsatisfactory ginger quality from China, while anticipating the impact of upcoming harvests from Brazil and Peru.
Some of the harvest from Peru, however, has been destroyed upon arrival in Germany, due to the bacterium Ralstonia solanacearum being found. In Italy, lower supply is pushing up prices, with concerns about a major arrival of ginger from China to stabilize the market. Meanwhile, South Africa is contending with a severe ginger shortage caused by Cyclone Freddy's aftermath, leading to soaring prices and uncertainties about future availability. In North America, the situation is mixed, with Brazil and Peru shipping ginger, but concerns linger over possible reductions in future shipments, while China's ginger volumes remain shrouded in mystery.
Netherlands: Uncertainties in ginger market
The ginger season is currently in transition from the old to the new season. "That creates uncertainties. People don't give prices so easily. Sometimes the ginger seems very expensive and another time it is not too bad. The prices of Chinese ginger are somewhat under pressure and from Peru and Brazil the market has been fairly stable in recent weeks. However, the differences in quality are big and sometimes this does result in a price difference of 4-5 euros per box," says a Dutch importer.
Germany: Shortages expected this season
The German market is currently somewhat undersupplied, says one importer. "In China, there are lower volumes available and the qualities aren’t that satisfying in general, which is reflected in correspondingly high prices. The Brazilian export season will first gain importance around late August-early September." In Costa Rica, the ginger season has already ended, while only smaller quantities can be imported from Nicaragua. It remains to be seen how the Peruvian harvest will develop this year, the importer adds. "They reduced the area under cultivation by about 40 percent last year, and they're also currently battling a bacterium in the crop."
Demand has been slightly increasing since last week, he says, likely due to the colder temperatures in Germany. This usually boosts sales, he stresses.
Italy: Lower supply than usual pushes up prices
Three countries are the main ginger exporters to Europe: Brazil, China and Peru. The Thai product is also present.
Until two weeks ago, ginger was very expensive. According to a wholesaler in northern Italy, there are several reasons for this: the climate in the producing countries and, above all, the Covid-19 situation in China. From the middle/end of August, the situation should change: prices at origin seem to be falling at the moment. "We went from 3,400 dollars a tonne 15 days ago to 2,800 on 17 July. For a 5 kg box of Chinese ginger, we have to expect 22-23 € on the market. We are talking about more than 4 €/kg. Domestic demand in China has fallen and there is still stock available because the new campaign starts between December and January". Prices for Brazilian ginger are also high: €25 for the product leaving Brazil in a 13 kg box, €40-45 when sold in Europe.
According to another operator from northern Italy, there is less ginger coming into Italy than usual, and what is there is quite expensive. Now the product comes mainly from South America and is not cheap. There is a shortage of ginger from China, which usually normalises prices. In consumer shops you can find conventional Peruvian ginger at 6 €/kg or organic ginger at 12 €/kg. A major arrival of ginger from China is not yet expected to bring down current prices.
South Africa: Cyclone Freddy causes ginger shortage
In February and March this year, Cyclone Freddy the longest-lived tropical storm ever (lasting over 5 weeks!) caused severe flooding and the ginger market now sees its result on the ginger crop grown in the northeast of South Africa and in Mozambique.
Ginger is very scarce, says a ginger trader at Johannesburg market, and not only the rhizomes for consumption but the plant material too – with the heavy rains and a prolonged period of waterlogged soils, ginger growers had lost their propagation crop too.
Fresh ginger is selling for very high prices: “For 5kg I’d say about R450 [22.4 euros], that R80 [4 euros] per kilo.”
The large South African retailers are reportedly also short on ginger.
The market agent wonders whether he will have ginger beyond November. Ginger is primarily commercially grown around Hazyview and Kiepersol, Mpumalanga.
Importing ginger from China has become more expensive than it used to be; post-Covid, China consumes more ginger. South Africa usually imports ginger from China and Thailand.
North America: Can ginger pricing stay strong?
The Brazilian ginger season is underway with reduced volumes this year. One shipper just received its second batch of containers of ginger this week and says the season should go until late November-December. “The season was delayed because nobody wanted to ship too early and have quality issues, especially with product that’s much more expensive than in the past,” says the shipper.
In turn, pricing has reached over $30 FOB Brazil. Last year at this time, pricing was at $16-$18 FOB. “The growers raised the prices because of the low supply,” says the shipper, noting that demand is steady right now but should pick up in September.
Peru is also shipping ginger currently, though shipments could possibly reduce in the next few weeks which means pricing could reach the high $20s, up from the $21-$22 that Peruvian pricing is currently at. China is also shipping ginger though how much is a mystery. Pricing for Chinese ginger is also higher than pricing on Brazilian or Peruvian ginger
Peru: Peruvian ginger destroyed in Germany
Ginger shipments from Junín, Peru, have been incinerated in Germany due to bacterium Ralstonia solanacearum found in ginger shipments.
A producer and exporter stated that the European Union is conducting more frequent analyses, and he fears if the detection of Ralstonia continues, it could result in sanctions, market restrictions, and ultimately the closure of the market for Peruvian ginger.
SENASA, Peru's National Agrarian Health Service, has issued a letter to ginger packers with specific instructions to not include ginger from unknown origin in shipments and to refrain from accepting ginger from washers.
He warns supermarkets and wholesalers to make sure they buy ginger from reputable and verifiable exporters who do not source from the many washers who are believed to be unregistered. He stated while the Peruvian authorities only authorised about 40 pack houses there’s reportedly 100 who are exporting ginger.
For the next two weeks, we will be taking a break. We will return on August 11 with Global Market Overview Potatoes!