Ginger: Peru struggles with quality issues

Peruvian supplies are contaminated

The European ginger market is currently facing some hurdles, as the experts at FreshPlaza report. Currently, the transition from the old to the new season is taking place, which leads to uncertainties, according to a Dutch importer. He told FreshPlaza that there are strong price fluctuations depending on the supplier. Chinese prices in particular are unstable, while goods from Peru and Brazil are somewhat less volatile. However, the differences in quality should not be disregarded, as they cause price differences of up to 5 euros per box.

In Germany, there is currently a certain supply bottleneck, as market players report. "In China, there are lower volumes available and the qualities aren’t that satisfying in general, which is reflected in correspondingly high prices. The Brazilian export season will first gain importance around late August-early September", FreshPlaza quotes an importer. Temperatures in Germany have dropped noticeably in recent days, leading to increased demand for ginger; cooler weather usually boosts sales. Recently, some ginger shipments from Peru had to be destroyed because the Ralstonia solanacearum bacterium was discovered; this could have more far-reaching consequences.

EU imports up significantly

Meanwhile, a wholesaler in Italy reports extremely high prices, which can be attributed to the difficult climate in the producing countries and some Covid-related problems in China. However, price declines are already being observed and should continue in August. “Domestic demand in China has fallen and there is still stock available because the new campaign starts between December and January", indicates the trader. Currently, traders are buying Chinese ginger for around EUR 4.00/kg. In addition, less goods are said to reach the Italian importers, which has further pushed the prices to the high level. Many buyers have therefore switched to goods from South America, which, however, are also relatively expensive.

The import data of the European Commission show that the buying interest in Europe remains high. According to them, EU imports in 2022 increased by more than a third compared to 2021 and amounted to 9,109 mt last year. The two most important suppliers were Nigeria and China, which were able to significantly increase their exports to Germany; India, however, which occupies third place, suffered losses. It is noteworthy that Vietnam was able to more than double its shipments to Europe.

Imminent shortage of goods in South Africa

After Cyclone Freddy, the longest lasting tropical storm of all time at over five weeks, swept across Africa in February and March causing severe flooding, ginger growers in South Africa and Mozambique are now feeling the consequences. They told FreshPlaza that crop damage has occurred and ginger is in short supply there - not only for the rhizomes intended for consumption, but also for the planting material for the new season, which has become unusable due to waterlogging. Some traders are uncertain whether their goods will even last until the end of the year. Prices for fresh ginger are therefore also very high here at the moment. As China's domestic consumption has increased, imports from the Asian country have also become expensive for African importers.

Concern in Peru

The season is already over in Costa Rica, and only small quantities are reaching the markets from Nicaragua. The Brazilian season, meanwhile, is in full swing, although exports here are also lower than usual. “The season was delayed because nobody wanted to ship too early and have quality issues, especially with product that’s much more expensive than in the past”, a shipper told FreshPlaza. Growers have also raised their prices due to a smaller crop, while demand is expected to pick up by September at the latest.

Peru is continuing its exports, but is struggling with the aforementioned quality problems due to the Ralstonia solanacearum bacterium; shipments in which the pathogen is detected must be destroyed. A Peruvian exporter stated with concern that the EU carries out analyses more frequently than other destination countries and that further discoveries of the bacterium could lead to sanctions or an export ban on Peruvian ginger. SENASA, Peru's national agricultural health service, has therefore issued a letter with explicit instructions for market players not to accept ginger of unknown origin and to buy the goods only from reputable and verifiable traders and under no circumstances from unregistered laundries. In addition to the quality difficulties, Peru's growers are also expecting a smaller crop than last year, as they have reduced their acreage by about 40%, according to current estimates.

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