BEIJING, Dec. 3 /PRNewswire-Asia/ -- Long believed to provide a variety of health benefits, ginger, one of the most important ingredients in global cuisine, has seen increased demand in China during this flu season.
The timing of this ginger demand increase coincides with supply shortages, effecting upward price pressures in a way that has speculators wondering about a potential repeat of the current demand hysteria over garlic. Garlic, also believed to have flu-fighting properties, has seen wholesale prices increase by as much as 1500% since March.
By comparison, retail ginger prices have increased just 85% in China in under a year. But a similar price spike may be seen in ginger as Chinese consumers and speculators begin to hoard the spice, commonly used in traditional Chinese medicine to treat colds and other ailments. The health benefits of honey and ginger in treating respiratory problems is well known.
Falling ginger prices over the last 3 years have contributed to current supply shortages, with many farmers switching to more profitable crops. With fundamentals firmly pointing to a sustained price increase, ginger producers and consumers are looking at a potential price surge. Eddie Cheung, CEO of Man Shing Agricultural (MSAH.OB), one of the largest ginger producers in China, is well-positioned with one of the largest stockpiles of ginger in the world. "We have been positioning for an upswing in the price of ginger for some time, based on the low levels of planting over the last two years and the long-term market trend. The health benefits of ginger and the current concerns over swine-flu were not considered in our plan, but they will very likely contribute to further the expected price increases."
Garlic has seen a similar pattern of shortage and price increases, but prices for garlic have risen astronomically. David Anderson, a director with consulting and research firm GMC Group China, follows the agricultural market in China closely. "It's quite incredible, with parallels to "tulip mania" from the 1630's in the Netherlands. We've seen large numbers of speculators shifting money from mainstream assets, piling it into garlic in the hope of turning a quick profit."
Ginger, along with garlic, is one of the most important ingredients in the cuisines of India, China, Thailand and Japan.
SOURCE Global Markets China Research
|SOURCE Global Markets China Research|
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