Peru’s Ginger Expansion and Market Challenges: Impacts on Pricing and Competitiveness
Peruvian ginger production is under pressure from phytosanitary issues and increasing Brazilian competition. A projected rise in planting areas could lead to lower prices and a potential oversupply. Despite challenges, demand remains strong, particularly in the U.S., with exporters striving to meet international quality standards.
Peruvian ginger is currently grappling with phytosanitary challenges that could hinder its global market competitiveness. The sector is experiencing mixed projections due to an increase in crop expansion and competitive pressure from Brazil. The market’s stability will ultimately depend on how effectively Peruvian producers address these issues.
The 2024 season was characterized by a shortage of raw materials which resulted in elevated prices; however, this year is anticipated to see a significant shift with an increase of 40 to 50% in planting areas, as noted by Grober Galindo, a representative of La Campiña. He remarked on the previous season, stating, “The 2024 season ended early due to low sowing and the presence of Ralstonia, which generated fear in exports to Europe.”
The increase in the cultivated area is expected to lead to an oversupply of ginger in the market, thereby exerting downward pressure on prices. Currently, the price for a 30-pound box is approximately $38 in the U.S., notably high for this time frame. Grober emphasized, “The market is already monitoring the production volume in Peru. Buyers in Europe and the United States know the numbers and adjust their purchases according to supply.”
An ongoing significant obstacle for the Peruvian ginger industry is the Rastonia bacterium, which raises critical concerns in the European market. Grober explained, “It poses a high risk. It can appear in the product’s very early stages and, if detected in a container, it must be incinerated, which represents a great loss for exporters.” In response, Peruvian companies are intensifying sanitary controls in collaboration with entities such as Senasa and INIA.
Despite the challenges posed, the demand for Peruvian ginger persists robustly. Grober stated, “We are exploring new opportunities in the United States and expanding our product range, including fresh ginger, IQF (Individually Quick Frozen), and ginger juice.” While there is optimism regarding market expansion, exports to Europe remain complicated due to stringent phytosanitary requirements.
In summary, the Peruvian ginger industry faces significant challenges, including phytosanitary issues and competition from Brazil, which are influencing market prices. An anticipated increase in planting areas may lead to an oversupply, thereby lowering prices. Despite these hurdles, there remains a strong demand for Peruvian ginger, with efforts focused on expanding market opportunities and enhancing quality assurances to meet international standards.
Original Source: www.freshplaza.com
