Global Ginger Market Update – Havest, Production Import / Export Trend

Global Ginger Market

1. Ginger Harvest Calendar

Below is the seasonality of Ginger in some biggest market:

Source: tridge.com

The ginger harvest season in China is normally begins when the end of autumn and winter arrives, Peru ginger is harvest from June / July. While in South East Asia, Thailand ginger start to harvesting in end of Dec. In Vietnam, the time of harvest ginger is spread from Oct to Dec, but the supply time is all year round.

 

2. Production and export trend

Health has become a top priority of consumers since the outbreak ofCOVID-19, and ginger, known for its many nutritional benefits, has risen sharply in demand throughout the globe. China iscurrentlythelargestproducer of ginger in the world.

Source: ITC Trademap

The global ginger market is set to reach USD 4.8 Billion by 2027, growing at a CAGR of 5.4% over the period 2020-2027. During the same period, from 2020 to 2027, Chinese ginger exports are forecasted to reach USD 1 Billion by the year 2027 and Canadian and Japanese exports are set to increase at a rate of 4.8% and 2.9% respectively, with Germany is set to grow at a rate of 3.4%. Fresh ginger exports are projected to grow at a rate of 6.1%, reaching USD 1.9 Billion by 2027, with dried ginger expected to grow at a rate of 5.4% over the 7 year period.

 

Effect of the Coronavirus on Global Ginger Prices

Chinese ginger, as the biggest worldwide exporter, accounts for approximately 47% of global exports. Harvest for Chinese ginger was already expected to decrease by 15-20% during the 2019/20 season, compared to the 2018/2019 season, as floods affected production. Following the halt of ginger imports from China in 2020, prices in Southeast Asian and Middle Eastern countries such as Vietnam, Bangladesh, and Pakistan went up significantly.

The decrease of Indian ginger supply during 2019/20, the second-largest exporter, further intensified the global shortage. India had gone off to a bad harvest for the 2019/20 season which was expected to decrease by almost 30% by the end of 2019/20 season, due to two consecutive years of floods that have severely damaged production. Prices of Indian ginger were around USD 2.72K-3.45K per ton from domestic production shortages in 2020. Furthermore, the third-largest exporter, Iran, also underwent temporary closures of its borders in 2020, due to severe coronavirus outbreaks, contributing to the worldwide shortage which has carried forward in 2021.

In Vietnam, prices of Vietnam fresh ginger increased by about VND 20K-30K (USD 0.86-1.29) per kg in early February 2020, while prices in Bangladesh increased by BDT 180-220 (USD 1.14-1.39) per kg, and Pakistani prices were at PKR 400 (USD 2.53) per kg, up by PKR 80 (USD 0.51). Additionally, consumers in Indonesia began stocking up on ginger to use in drinks in 2020, following a recent study that proved consuming traditional ginger beverages increases immunity to diseases. As a result, prices of aromatic ginger rose from IDR 35K (USD 2.43) per kg to IDR 42K (USD 2.92) per kg during the year.

 

China Ginger

China is currently the leading exporter of ginger in the world. Chinese fresh ginger exports have steadily grown over the past 5 years, growing from USD 416.6 million in 2015 to USD 541.2 million in 2019, an increase of close to 30%. Dried ginger exports increased from USD 28.9 million in 2018 to USD 30.5 million in 2019. Chinese ginger exports have been forecasted to reach USD 1 billion by 2027, growing at a CAGR rate of 8.3%

Many ginger growing regions in China were severely affected by heavy rainfall in 2020, such as the Shandong province where a 20% decrease in production is expected. However due to the high market prices, growers had planted more anticipating a 20% increase in production, therefore the damage from the heavy rainfall left this year’s harvest the same as the year before.

The heavy rainfall affected conventionally cultivated ginger, however organic ginger in the Guangxi province benefitted from the rainfall as quality improved and the production increased by 30%. The demand for ginger has risen during the year due to the COVID-19 pandemic. However, due to China’s depleted supply, the price of ginger was high throughout 2020, going up by as much as 80% at its peak, and is expected to reduce in 2021. In March 2020, fresh ginger was priced at around USD 2100 per ton and dried ginger was USD 2300 per ton.

Chinese and global ginger prices were volatile in late February 2020 as the coronavirus outbreak disturbed both the supply and demand of the vegetable. Prices in China increased by 17% in early February 2020 compared to the start of December 2019 and only stopped rising recently. Prices had started rising around 7-9% each week from late January 2020 to mid-February 2020, reflecting labor shortages in farms and distribution networks, as workers were urged to stay at home. Production in mid- February 2020 was around 50% of the usual volume. Additionally, the virus outbreak caused delays in container shipments in China which led to higher freight costs and decreases in exports in 2020.

Source: Mintec

 

 

Peru Ginger

Peruvian ginger exports have increased steadily from USD 22.1 million in 2015 to USD 40.2 million in 2019, amounting to an 81% increase over a 5 year period.

Due to the reduced ginger supply from China in 2020, exports of Peruvian ginger increased, leading to record breaking numbers for the country. 29,436 tons had been exported by September 2020, a 108% increase from the previous year.

This 2020/21 season ended early in January 2021 instead of March 2021 due to the increased ginger demand this season. The upcoming season is expected to start in April 2021, with production volumes expected to increase.

 

Nigeria Ginger

Production of ginger in Nigeria has been gradually increasing from 2019. Nigeria produces approximately 37K metric tons of fresh ginger annually. Out of this number, 10 percent is consumed fresh locally, while 90% is consumed in its dried form. About 20% of the dried ginger is consumed locally for various uses, while the remaining 80% is exported. Ginger is produced predominantly in Northern Nigeria, especially in the state of Kaduna. However, in Southeast Nigeria, the state of Abia boasts a large presence of ginger farmers. The production of ginger in the Ikwuano Local Government Area of Abia is conducted predominantly through the efforts of local farmers.

 

Challenges in Ginger Production

For the production side, rainfall abnormality, market gluts, and fertilizers are the major challenges facing ginger production, while processing at the village level, middlemen problems, and a lack of credit facilities and direct access to the international market work as constraints that exceed the capabilities of ginger farmers. Irregular rainfalls, which occur in all of Northern Nigeria, are a big challenge for agricultural production in the region including ginger. For ginger farmers, in particular, the occasional inadequate amounts of rainfall greatly affect the yield of ginger. When farmers envisage or observe a delay in the onset of rainfall, they overcome the situation in two ways.

The first is by shifting to alternative crops such as sorghum or maize, and second by reducing the amount of ginger cultivation to half or one-third. On the other hand, if rain abnormality occurs in the middle of or towards the end of the wet season, the commonly adopted strategy is to delay harvest until the next harvesting period or season. A market glut is a situation in which there is an excess supply of commodities against the demand for it, within a competitive market. This is a situation that happens often in Nigeria, especially when the price of ginger rises, as it entices ginger farmers to increase ginger production in the subsequent growing season. In most cases, this results in an overproduction greater than the market demand. When such a situation is expected, those that are yet to harvest their products or have just started with harvest pause harvest until around May to June, when there is a high demand for fresh ginger. This strategy helps ginger farmers break even.

 

European Union

In Belgium, ginger demand was high in 2020, however, as the year progressed it began to subside with prices remaining high. The German market currently has limited supplies of ginger, with wholesale prices rising to about 40 Euro per 12kg, which was far higher than the normal price during the period which is usually 25 to 26 Euro per 12kg. Italy continues to suffer from ginger shortages due to logistical problems brought about by the COVID-19 pandemic. A field trial to analyse the suitability of ginger cultivation in Sicily took place in 2020, with 20 hectares expected to be cultivated in the Southeast of the Island.

 

United States

The US remains the leading exporter of fresh ginger in the world. Imports have increased steadily over the past 5 years, reaching USD 112.3 million in 2019, an increase of USD 8.3 million from 2015. The US resorted to importing ginger from South America and Europe in 2020, as a result of China’s limited supply in 2020. Due to the rising demand for ginger, as a result of the pandemic and market shortages, prices in the US market rose by 30 to 40% in 2020.

 

 

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