China: multiple causes year-on-year decline fruit prices

This year, the Chinese fruit market finds itself in a state of over supply; due to this fruit prices…

This year, the Chinese fruit market finds itself in a state of over supply; due to this fruit prices are dropping. There are several reasons leading to this situation.

First of all, the number of fruit growing areas is increasing continuously. For example grapes, in the past there was only one place that produced one sort of grape variety. Today, along with the uninterrupted development of technology and science, large areas are evolving in to growing areas. Xinjiang, Northeast China and other traditional growing areas are facing new opponents as Jiangxi, Hebei and other regions.

When the number of growing places increases, the output is also increasing. If the market demand cannot process the over supply on the market in a short period of time, prices will drop naturally.

Secondly, foreign fruit is constantly entering the Chinese market. For example bananas, in the past bananas were mainly produced in Hainan. Today, the import of fruit from Vietnam, Laos and other places has a serious impact. Further more, there is large pressure due to a downfall in the economy. Some fruit deep processing manufacturers are shrinking their production capacity, leading to rising fruit inventories. Due to this fruit prices are falling further.

The above mentioned causes are leading directly to the fact that this year's prices stayed low continuously and that prices are approximately 1 Yuan per kilo lower than previous years, in some cases even more.