The Brazilian ginger season is underway although with reduced volumes this year. “The acreage, yield and production are all reduced, mostly because of a bad year. Last season there were losses and growers had less money to reinvest into production,” says Frederico Stuhr of Pommer Fresh Foods.
The Brazilian season has begun and Pommer just received its second batch of containers of ginger this week. The season should go until late November-December. “The season was delayed because of the availability,” says Stuhr. “Nobody wanted to be shipping too early and have quality issues, especially with product that’s much more expensive than in the past.”
Indeed those reduced supplies have meant pricing has reached over $30 FOB Brazil. Last year at this time, pricing was at $16-$18 FOB. “The growers in Brazil got together and raised the prices because of the low supply. We don’t think the market is really willing to pay all of that and that’s why it’s moving slowly,” says Stuhr, noting that demand is steady right now though it’s anticipated that demand should pick up in September. “That’s when we’ll see what’s really going to happen. That’s the planting season in Brazil and supply could reduce even more and prices could go up. At least we don’t think the price will go down.”
Other supplying regions
Along with Brazil, Peru is shipping ginger currently though Stuhr says it’s oversupplying the market. That said, 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. “Brazil has lost a lot of market share to Peru mostly because of costs. Peru is cheaper than Brazil and some customers are price-driven and switch. We are shipping 60 percent of the volume from Brazil that we did last year,” he says.
At the same time, China is also shipping ginger though how much it is sending is a bit of a mystery. “There are reports that all of the ginger is already harvested there but nobody can tell how much they have,” says Stuhr. “The local market is very strong there and the fear is shipping too much to export and not being able to fulfill the local market.” Pricing for Chinese ginger is also higher than pricing on Brazilian or Peruvian ginger.
In addition, some other countries seem to be developing their ginger production to a smaller extent, though mostly they are filling the gaps in the market with inconsistent supplies. These countries include Honduras, Costa Rica, Nicaragua, Ecuador and Mexico.
