China’s Ginger Exports Fall as Export Prices Rise

Published Aug 27, 2021

TRIDGE’s Weekly Trend Analysis tracks patterns in traffic behavior, giving insight into notable events in the agricultural industry. According to data from Week 4 of August, traffic from Thailand on ginger-related pages has shown a 300% growth within the last two weeks, showing the highest level of daily traffic after this March.

China is one of the top ginger exporting countries in the world, representing 54% of the total market share. Chinese fresh ginger exports have steadily grown over the past 5 years, increasing from USD 416.6 million in 2015 to USD 697.4 in 2020, an increase of close to 67%. During 2020, Its export volume went up in the global ginger exports and export volume going up to 502 thousand metric tons. The country exports ginger throughout the year however the exports pick up pace in February end and lasts July- August. During the first four months of 2021, China’s ginger exports fell by 31.7% compared to the same period last year.

Source: Tridge. HS Code: 091011

China’s ginger exports are under great pressure this season due to its high price in the global market. The following incidents have increased the price of Chinese ginger relative to other ginger exporting countries:

Appreciation of the Chinese yuan has made the ginger expensive for the traders in main ginger importing countries overseas, including the US. In August 2020, the exchange rate stood at 1 Chinese Yuan Renminbi = 0.144 United States Dollars which has now appreciated to 1 Chinese Yuan Renminbi = 0.154 United States Dollars. The trend of appreciation has been seen since October 2020 and peaked in May 2021.
The shipping price has increased across the world since the pandemic and it continues to rise even today. Between August 15 and 30, shipping between Qingdao (China) and Felixstowe in the UK will cost approximately USD 14,970.5 - USD 15,968.2 per container which is roughly USD 677.7 per tonne. Similarly, the current FOB price from Qingdao to Rotterdam stood at about USD 1,347.1 per ton higher than the usual prices.
The reoccurrence of the COVID-19 outbreak at different ports across the world has resulted in fewer shipping containers returning to China. The shortage is most severe while exporting from China to North America and Europe.
The wholesale price of ginger in domestic markets of other major exporting countries like Brazil and Thailand is significantly less than the prices recorded in China. This has shown some impact on the export prices and made Chinese ginger exports more costly relative to low prices Ginger from Thailand and Brazil. Buyers are particularly interested in Thai ginger which has a strong flavor and taste and can be purchased at a reasonable price.

Source: Tridge

All these factors have made the overseas demand for Chinese ginger weak, therefore there are hardly any traders who inquire about prices for Chinese ginger. The export price of Chinese ginger destined for the European market is now around 2,200-2,300 USD per ton which is about 30% higher than around this time last year.

China has witnessed a bountiful ginger harvest this year, and the average is higher than last year. However, weak demand and ample supply in the domestic market have resulted in falling ginger prices in Chinese markets while the export prices continue to soar. The outlook for Chinese exports in 2021 does not seem very optimistic if the shipping prices continue to rise and the container shortage prevails.