Due to another low volume harvest season in 2017 and lack of carry-over inventory, a stable season with a strong demand for quality root is expected. However, there are potential unknown effects on the market due to the increased tariffs and growing anti-American product sentiment among international consumers resulting from the escalating trade war.
Last season's harvest was considerably below the normal harvest of 60,000 lbs. In addition, China's economy continued to slow, resulting in a weaker demand and pricing for wild ginseng. However, the smaller dig helped to clear out existing inventory still held by many USA dealers. AG expects stable market conditions for the upcoming season.
Due to one of the main supporters of the wild ginseng market going through a restructuring and the continued growth of inventory carried over in Asia, along with approximately 8,000-10,000 lbs of unsold root carried over by USA dealers, we expect the demand for dry wild ginseng will be weak and that market prices will open approximately $200 less than seen in the previous year. These factors will also impact the fresh market.
AG expects prices to open $100 to $150 per pound less than those seen in late November and early December 2014. This expectation is subject to market variations and 2015 growing conditions.
Due to various changes in China’s commerce regulations, profitability of upscale restaurants and luxury retailers declined. For example, sales in designer handbags decreased nearly 30% within the country. These changes in commerce also affected the wild American ginseng market, as the highly sought after wild American ginseng was frequently given as honored gifts. The increase in ginseng supply, coupled with the changes in China’s commerce regulations, caused prices to fall $300 to $400 USD per pound from 2013 highs.
The U.S. Fish and Wildlife Service reports 19,360 more pounds of dry ginseng were harvested in 2013 than in 2012. Despite the increase in supply, record prices (nominal) were realized for ginseng throughout the season.