BEIJING, May 19 /PRNewswire-Asia/ -- Frbiz.com, one of China's leading B2B search platforms, surveys vegetable price rising not driving farmer's income.
This year, in some areas of China, vegetable price fluctuations indicate that while vegetable prices rose, vegetable farmers did not benefit from it.
From the statistics, in recent days, it seems that the overall wholesale prices of vegetables has sharply declined since the beginning of May. The current average price of vegetables is down 20% compared with May 1. Many people are wondering why.
Frbiz reporters said that the monitoring department-published monitoring data was on wholesale prices, and people feel this is most directly related to the retail price; on the other hand, agricultural products flow though many intermediaries, and profit exploitation by middleman may occur at any stage and price increased at any stage.
The chain of supply is generally experienced vegetable growers - vegetable peddlers - wholesale markets - retail - consumer. Businesspeople at each step want to maximize profits, so naturally prices may rise quickly.
Frbiz interviewed a farmer, and he said, "This year the price of vegetables is very high, but this does not mean an increase profits for farmers. The little cucumber sold at its highest price of RMB 9 per catty during the Spring Festival, but that time the weather was cold, production was low. Although these days the price has dropped to about RMB 1 per catty, the yield is up, so we earn more than during the Spring Festival. And we have no pricing power, so we did not try to lock in profits when the prices of vegetables were rising. On the contrary, once the price of vegetables decreased or when circumstances are difficult, loss is a common thing. Moreover, our profit is decided by vegetable peddler. Whether prices rise or fall, the peddler always makes a profit, while vegetable growers and consumers cannot get any profits"
Frbiz analyzes that apart from total price levels rising throughout the economy, an important reason for increased prices is that vegetable production costs are climbing. Land prices are going up every year, and price per acre for suburban arable land has reached 1,000 yuan. This year, seed, fertilizer (http://www.frbiz.com/catalog-01000000-1/agriculture.html ), and pesticide prices have risen fast, so the overall cost compared with last year has increased almost 20 percent.
Although in the beginning of May, with the weather improving, vegetable prices dropped significantly, prices of the main vegetable varieties are still high compared to the same period of last year, a result of increased costs of production.
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