Why is the garlic price now a "roller coaster"

Since June last year, the price of garlic across the country has continued to rise. In Beijing's newly developed agricultural and sideline products wholesale market, known as the national "barometer" of agricultural and sideline product prices, the wholesale price per jin of dried garlic at the end of October was as high as 7.8 yuan, 18.2% higher than the all-time high of 6.6 yuan per jin. People exclaimed: "garlic is ruthless" again.

Recently, at the gate of a farmer's market near Taoran Pavilion in Xicheng District, Beijing, the vegetable vendor Fu Erjun was moving garlic into the farm at a price of 10 yuan per jin. Many consumers who come to inquire about the price feel that the price is high.

"the primary reason for this round of garlic price rise and high operation is the reduction of garlic acreage across the country." Kong Fantao, chief expert on vegetable market monitoring and early warning of the Ministry of Agriculture. The planting area of garlic in China accounts for more than 50% of the world, the output accounts for about 70% of the world, and the annual output and export volume rank first in the world. The planting area of garlic in China has basically stabilized at 4 million mu in recent years, and the price of garlic in 2014 is on the low side. Since last year, some vegetable farmers in the main producing areas have reduced the sown area of garlic. According to monitoring data from the Ministry of Agriculture in 580 key vegetable counties across the country, the area of garlic in the field decreased by 2.2% in 2015 compared with the same period last year.

During the Spring Festival this year, the main northern producing areas experienced a big cold wave, resulting in the mass extinction of garlic in the main northern producing areas. Fu Erjun said that Jinxiang could produce three to four thousand jin of fresh garlic per mu of land in previous years, but this year it only harvested more than 2000 jin. Kong Fantao estimates that due to the dual effects of reduced planting area and cold wave, garlic production in the main producing areas has decreased by about 8% this year.

In addition to the production reasons, some industry experts believe that the abnormal soaring price of garlic lies in the hoarding of hot money. When the new garlic was listed in the main northern producing areas in May this year, the market had already shown signs of hot capital speculation. Under normal circumstances, after fresh garlic begins to appear on the market, as the listing volume is gradually enlarged, the price will gradually go down. "the price of garlic is a little abnormal this year." Liu Tong, manager of the statistics department of Beijing Xinfadi agricultural and sideline products wholesale market, said. In the first week of May last year, the price of fresh garlic fell from 1.5 yuan to 2.1 yuan per catty to 1.3 yuan to 1.8 yuan per catty, a drop of 13.89%. This year, it rose 13.64%, the trend is opposite to the same period last year.

"some private capital in the main producing areas to control the source of garlic is one of the reasons for the sharp and rapid rise in garlic prices." Said Li Huishang, an associate researcher at the Institute of Agricultural Information of the Chinese Academy of Agricultural Sciences. The garlic production and market in China have three obvious characteristics: first, the producing areas are concentrated, and the main producing areas are at the junction of Shandong, Henan and Jiangsu; second, the market is immature, the total amount of garlic is small, the plate is small, and after investors or dealers master the resources, we can manipulate the market price by means of collusion and association. Third, garlic is easy to store after air-drying and irradiation, and investors can operate flexibly according to the market situation, hoarding and selling at the right time to get the maximum profit.

The price of garlic has risen abnormally. Some businesses have made a lot of money by hoarding goods, but some have lost money. Mr. Liu of Beijing Xinfadi Agricultural and sideline products Wholesale Market is one of the losers. In early May, seeing that the price of fresh garlic rose instead of falling after it went on the market, he decisively ate 20 tons of fresh garlic at the price of 2.5 yuan per jin and manually dried it into 12 tons of old garlic. He planned to sell it after the price continued to rise, but then the price of garlic gradually fluctuated and fell. On May 6, the average price of ordinary fresh garlic in Xinfa was 2.5 yuan per jin, but it had dropped to 1.15 yuan on May 26. The average price of old garlic in Xinfa had dropped from 5.6 yuan per jin on May 6 to 4.75 yuan on May 26. At the bottom of the price, Mr. Liu acknowledged the loss. In October, the price of dried garlic exceeded 7.5 yuan per jin, but the downstream demand was much less. "the price of garlic is too high, consumers spend less, and it is difficult to sell if they earn too much." Mr. Liu usually buys two carts of garlic from Shandong every week, but now he only dares to get in one.

Fu Erjun said that in the past, he could sell more than 80 jin of garlic a day, but now he can only sell 30 to 40 jin a day. "at the Beijing Xinfadi Agricultural and sideline products Wholesale Market, the daily turnover of dried garlic is usually 200 tons, but now it is only about 100 tons per day. The wholesale price can be as high as 7.8 yuan per jin, which has never been seen for many years, but it is really too high. The asking price of the place of origin is high, which is not much different from the market price of the newly developed land. Merchants do not dare to charge more or sell more, and most of them are losing money. " Liu Tong said.

From the law of garlic price operation, the characteristics of a three-year cycle are more obvious. Generally, the price peaked and fell after the garlic went on the market one after another in the new season. The period from 2012 to 2013 was an upward cycle, followed by a downturn. The price of garlic has been high for more than a year from 2015 to 2016. Looking forward to the future, industry experts predict that the overall price of garlic nationwide will fluctuate and fall.

Although garlic belongs to small agricultural products, its price ups and downs pose a great risk to producers and operators. Li Huishang suggested that relevant departments should strengthen market monitoring information services, release timely information on planting area, output, market price, and inventory consumption, and guide farmers to arrange production rationally, so as to stabilize planting area and output, ensure basic stability of market supply, and severely crack down on illegal acts of hoarding and driving up prices.