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Ginger prices skyrocket with little relief in sight

Importers from both coasts say that the price of ginger, especially Chinese ginger, has risen to unprecedented levels and there is no relief in sight.

Jim Provost, president of I Love Produce in Kelton, PA, calls himself one of the larger year-round importers of ginger into the continental United States. He sources Chinese ginger year-round but also pulls from South America and Central America from July through December, and Hawaii and Thailand in the January-to-July time frame.

"Basically ginger is a two-hemisphere crop and contra seasonal," he said.

China is able to provide year-round supplies because exporters from that country do ship out of storage in the latter half of the calendar year.

Currently, the new Chinese crop is in the midst of being harvested and cured for ocean shipments beginning sometime in December.

Though there are not solid production numbers for that crop, Provost said his sources on the ground in China say that for the second year in a row supplies are down at least 30 percent. That has led to much higher prices domestically for ginger, which is consumed quite heavily in China.

In fact, Provost shared a news clip on Chinese television that showed reporters marveling about the high retail price for the root commodity.

"Right now there is no incentive to ship ginger overseas because they can get the same price [in China]," Provost said.

On Tuesday, Oct. 29, he said Chinese ginger was selling in the United States for about $32-36 per 30-pound carton -- about twice the price of a year ago.

Susan Bidvia-Kragie, tropical manager for Western Fresh Marketing, which is headquartered in Madera, CA, but has ginger farms in Hawaii, said the price of Chinese ginger was at levels she has never seen before.

"I can't get a straight answer as to why," she said. "They just keep on telling me there is no Chinese ginger."

She added that often Chinese ginger is shipped to Los Angeles by the boat load, with prices as low as $7 per carton.

"But not now," she said. "It's crazy right now. The price is skyrocketing."

While Brazilian ginger is available and Hawaiian ginger will start its new season in about a month, Bidvia-Kragie said those markets tend to operate independently from the Chinese ginger market.

"Right now Brazilian ginger is at $44 with Chinese ginger at $35," she said. "But a month or two ago when Chinese ginger was at $22, Brazilian ginger was still at $44."

She added that Brazilian and Hawaii ginger do affect each other but they don't tend to be influenced by the market on Chinese ginger.

"There are the 'ABC' folks out there that want 'Anything But Chinese' ginger, so they don't care what the Chinese market is," she said. "And the Chinese market also operates on its own."

She said the amazing thing these past few weeks is that the rapidly increasing price of the Chinese ginger has not slowed demand for that product.

Provost agreed that in the past the price of Chinese ginger did not typically affect the price of ginger from Brazil and Hawaiian, which traditionally have been considered the premium points of origin for the product.

However, he said the large volume of Chinese ginger in the marketplace in the recent past has cut into the available supplies from those two growing regions, as some growers have cut back acreage.

Conversely, Provost believes the demand-exceeds-supply situation for Chinese ginger, which has been building the last couple of years, has led to increased production of ginger from the Southern Hemisphere as well as Hawaii.

And this upcoming Chinese season, as that demand-exceeds-supply situation persists, he expects there will be more of a cause-and-effect relationship between the price of Chinese ginger and that from Hawaii, which is in production at the exact same time.

"With Chinese ginger at $35 or more, there is no way Hawaiian ginger is going to stay at $30 this year," he predicted. "They are going to go to $40 or $50."

Justin Guibert, who handles ginger sales for Christopher Ranch in Gilroy, CA, agreed with that assessment.

"There is usually at least a $10 spread between Hawaiian ginger and Chinese ginger," he said, but added that he does not handle Chinese ginger.

Guibert also agreed that it is a two-tier pricing structure and the two markets don't always react to each other, but with Chinese ginger so high currently, the market on the other supplies has been elevated in his estimation.

On Oct. 29, Guibert said Brazilian ginger was in the mid-$40 range and he expects Hawaiian ginger to open at least that high when shipments begin in a month or so.