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Speculators smell chance with China garlic


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#1 JimW

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Posted November 27 2009 - 11:39 AM

Having only recently learned here that most garlic is produced in China thought this was interesting.

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Speculators smell chance with China garlic

By Robert Cookson in Hong Kong and Patti Waldmeir in Shanghai
Published: November 25 2009 18:58 | Last updated: November 25 2009 19:32
China, already beset by a worrying real estate bubble, is now grappling with surging prices for a dinner table staple closer to home – garlic.
The world’s largest producer of the pungent bulbs, China has seen wholesale prices rocket as much as 15-fold since March in large cities such as Beijing, forced up in part by a combination of reduced acreage being planted by local farmers because of the recession – and a belief that garlic can keeping away swine flu.
Schools have been hoarding garlic for pupils to eat because of its reputed properties in warding off swine flu. The China Daily has reported that a high school in Hangzhou in eastern China, bought 200 kg of garlic and made students eat it at lunch to keep healthy.
Also supplies have been cut because farmers in China and elsewhere slashed plantings when prices collapsed in the financial crisis.
But in a phenomenon with a whiff of the 17th-century Dutch tulip mania, when wealthy merchants used their life savings to buy single bulbs, another cause of the garlic bubble may be old-fashioned speculation.
Jerry Lou, Morgan Stanley China strategist, who has been gathering intelligence from the country’s biggest wholesalers, said speculators, financed by the abundant liquidity sloshing around the country, had moved into the relatively small market and manipulated prices.
Mr Lou’s view is consistent with news reports from Jinxiang in Shandong province, the country’s garlic-growing heartland, which describe how cash machines in the area have run out of money amid frenzied trading.
"You need a warehouse, a lot of cash, and a few trucks. That’s how it works," Mr Lou said, describing the tools of the trade used by garlic speculators.
"Basically, what you do is try to arrest as much supply as possible then you bid up the price. Moving garlic from one warehouse to the other, you make millions of dollars."
Mr Lou said wholesale garlic business chiefs with whom he had spoken told a similar story: gangs who had amassed cash and credit from dealing property and stocks in other parts of the country, and who had targeted the garlic market for their next ruse.
In the basement of Shanghai’s Dagu Road meat and vegetable market, stallholder Zhang Weidong claimed foreigners were importing Chinese garlic for their own swine flu wars, exacerbating a shortage on the mainland.
He says customers are asking for his $1-a-pound garlic for protection against swine flu, just as medieval Europeans believed it warded off the undead.
China produces about three-quarters of the world’s garlic. Argentina and Spain are the next largest exporters.
Former South African health minister Manto Tshabalala-Msimang notoriously pushed garlic as a cure for Aids in 2006.
Garlic has long enjoyed popular support for its healthgiving properties.
China’s Ministry of Commerce – which tracks the rising prices across the country – recently dismissed garlic as a panacea. It posted an article on its website quoting Chinese traditional medicine experts debunking the notion that garlic is as good as a flu shot.
Members of the onion family have had brushes with controversy before. In the 1950s, American legislators banned the trading of onion futures, blaming speculators for driving up the price.
Whatever the real story behind for the price rises, growers in California, America’s garlic heartland, will be pleased. For years, despite tariffs, the US market has found it difficult to compete with cheap garlic from China.



#2 Farflung

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Posted November 27 2009 - 7:44 PM

should help our california growers, who have been having problems. We have a number of small scale growers in out area that have small acreages of garlic. They have been planting in October. Hope this is good for our own SOL garlic grower, Farmer Jeff.



#3 metaliczombi

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Posted November 27 2009 - 8:33 PM

Meh, so many of our food ingredients come from China now. It's cheaper to grow them there and put them on a container ship for a few weeks and then a few weeks more to distribute them around the country.



#4 charloots

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Posted November 27 2009 - 8:43 PM

Big Garlic cartel making a move



#5 AtlantaKing

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Posted November 27 2009 - 10:03 PM

Oh teh noes!!! Peak Garlic!
I've always wondered why the garlic in the little sleeves were way cheaper than the loose ones.



#6 GROBY

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Posted November 30 2009 - 2:19 PM

I grow my own and supplement that with locally grown stuff.

Your're taking your chances with garlic grown in China.Being that it will grow almost anywhere and in any kind of dirt...they could be growing it in soil more toxic than Love Canal ----....home grown baby!



#7 HardyG

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Posted November 30 2009 - 6:30 PM

a lot of chinese garlic is fertilzed with human waste. Great.


Just imagine how happy you would be if you lost everything you have in life and then suddenly got it back

#8 Paul_M

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Posted December 01 2009 - 9:57 AM

Oh teh noes!!! Peak Garlic!
I've always wondered why the garlic in the little sleeves were way cheaper than the loose ones.

Because of the size......larger heads get a premium price.


See you on the big one.

#9 Fishing For Life

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Posted December 03 2009 - 10:42 AM

a lot of chinese garlic is fertilzed with human waste. Great.










Quote:Originally Posted by Nebewhen the bay runs red, fish the mudhole instead

#10 Mike

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Posted December 03 2009 - 2:16 PM

Before I bought garlic last night I checked that is was USA garlic


"Depend not on fortune, but on conduct."


#11 IamClam

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Posted December 03 2009 - 5:47 PM

a lot of chinese garlic is fertilzed with human waste. Great.

I hope this is just a joke or something. I can't imagine any civilized people on the earth doing this. But then if anybody could do something this disgusting I figure it's them. Google china sucks and have a look at some disgusting stuff.



#12 Steve in Mass

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Posted December 03 2009 - 5:57 PM

I hope this is just a joke or something. I can't imagine any civilized people on the earth doing this. But then if anybody could do something this disgusting I figure it's them. Google china sucks and have a look at some disgusting stuff.



You might be surprised to find out that many farms in the US, even organic farms, use fertilizer that has been made from so-called human waste. Many waste treatment plants turn their sludge into compost, which is then used on US grown produce..............and a lot of the "disgusting" part is all in your perception................


SOL Member #174

#13 IamClam

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Posted December 03 2009 - 6:14 PM

You might be surprised to find out that many farms in the US, even organic farms, use fertilizer that has been made from so-called human waste. Many waste treatment plants turn their sludge into compost, which is then used on US grown produce..............and a lot of the "disgusting" part is all in your perception................

I don't know anything about farming so this is a kind of epiphany.I think I'll stop eating any vegetables for like forever.



#14 Farflung

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Posted December 03 2009 - 7:21 PM

If garlic or onion powder, salt, minced, etc. garlic is grown anywhere other than the U.S., it must be labelled as to country of origion. This is because it is considered a vegetable rather than a spice. I worry about agricultural practices of China, so I try to get U.S. or Italian grown garlic.

And the use of human waste for fertilization in China is reffered to as "night soil", and has been done for years. I'm more worried about their pesticides.



#15 Paul_M

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Posted December 04 2009 - 9:18 AM

Organic lettuce and partially decomposed chicken compost will make for a nice outbreak of bird flu or e coli someday. Nothing like nice clean oil based fertilizers.


See you on the big one.