Prices have softened slightly as there are roots in the market. It would also appear that several more processors have finished their conversion to natural gas from coal and are in need of cash, so selling oil at/or near cost.
Reports still confirm production is limited due to the strict environmental regulations being enforced, especially on many of the smaller producers. Prices have firmed.
When the government forced processors to switch to gas fired burners from coal, production reportedly switched to a different province. This caused prices to soften, albeit for a very short time. It did not take long before the government forced the change to take effect in that province also. With lack of dried roots available prices are firm.
Reports continue to state that while the crop is fine, production is still limited as many factories have not yet changed their boilers to gas in line with pollution controls.
We are seeing fewer offers and prices are firm.
Pricing dipped slightly last month due to several small processors being granted permission to distill without completing boiler conversions to natural gas. They have now ceased production and we are seeing prices begin to rise again.
Reports continue to state that many factories have still not converted from coal-fired boilers. With demand for fresh Ginger still strong very little oil is being produced.
Reports continue to advise that there is a lack of dried roots available for distillation. Pricing has increased and should remain firm for the foreseeable future.
With production still limited, prices continue to firm. As long as demand for fresh remains strong relief is not expected soon.
Despite the beginning of the harvest, prices for oil continue to firm. Demand for Fresh is strong and the spice markets are reporting that India’s crop will be smaller than normal. With pollution issues still being resolved, we do not see any relief soon.
The situation with Ginger remains the same. The conversion of boilers is still ongoing and going slowly. Stocks of oil are limited and less was produced in early November than was hoped for. Prices are firming.
Reports still advise that there is a shortage of dried roots and that the conversion of boilers to meet environmental standards is progressing slowly. With the crop time November through March, prices are anticipated to climb even higher after Chinese New Year, when demand for Oil usually surges.
Prices continue to rise as less and less roots are being processed due to pollution controls. Factories are unable to produce until their boilers are converted. Viewed in light of the reported lack of dried roots, several dealers are reporting that there will be no new oil in the market until after February of 2017.
Prices are expected to be firm until the new crop in December and January. The Spice Market is still reporting strong demand for fresh Ginger.
While we are aware of new pollution restrictions, dealers have advised that demand for Fresh Ginger for seasonings has dramatically increased, limiting what is available for the production of oil. One dealer advises that Dried Ginger will not be available for oil production until around December.
Several dealers have advised that the Chinese government has imposed new pollution controls on the production of Ginger Oil. Processors have changed their fuel from coal/biomass to gas. As the spent Ginger cannot be used as animal feed, a means of disposal needs to be found. These factors have contributed to the continuing rise in prices.
Prices are soft and inventory appears to be sufficient to cover demand.
*** Update – New developments are changing the market dynamic. More info to follow in next post.
An ease in demand for fresh has contributed to soft prices for Oil. Supply currently seems adequate.
A recent spice market report indicates that Nigeria’s crop was below normal and is mostly sold out. This has increased demand for dried out of China and India. It appears that pricing for Chinese Oil has bottomed.
Offers from before the Lunar New Year have remained at the same levels.
Prices for both fresh and dried roots used to make Oil have softened. We expect the market to become stable between 5-10% below the levels of 60 days ago.
The spice industry reports that the upcoming Chinese Ginger harvest in December and January will be quite large. Cited is the pressure to sell stocks of fresh. Since demand for fresh in China consumes the largest percentage of total production, this would support that belief. Prices are expected to soften.