Market Update

AUGUST 2025

CHINESE PEPPERS (GREEN, RED, YELLOW)

We are now in the peak of the pepper season, with harvesting well underway.

Pepper prices tend to follow a cyclical pattern, shaped by farmers’ planting decisions. A lower price one year leads to reduced planting and a smaller crop the next, while higher prices usually result in larger crop areas and eventual price softening.

A significant development this season is the widespread adoption of drip irrigation. Although more water-efficient, this method increases the moisture content in the fruit, making peppers more fragile and reducing processing yields—driving up production costs.

Planting areas are larger this year, suggesting softer pricing in the short term. However, a firmer market is expected again from Autumn 2026 onwards.

Persistent rainfall in Shanxi from mid-June to early July has reduced green pepper yields by approximately 30%. Red and yellow varieties were also affected, but their larger planting areas should help balance the impact.

MAY 2025

CHINESE GARLIC

The 2025 garlic crop from Shandong is developing well, with plantation areas increasing compared to last season. Earlier this year, garlic prices soared to extremely high levels but have recently begun to decline. Although there were initial expectations that the price of the new season crop would be significantly lower, current indications suggest that prices will remain broadly in line with current levels. While a drop is possible, it remains difficult to predict how substantial it will be, given ongoing shifts in demand and market behaviour.

CHINESE ONIONS

New season onions from Shandong and Hebei Provinces are on track for their usual mid-May harvest. Crop conditions appear healthy, and pricing is expected to remain similar to last season. However, rising plantation costs year on year mean prices are unlikely to fall further. Last season’s prices were already near production cost levels, and any potential price decrease would likely depend on a simultaneous drop in both domestic and international demand.

CHINESE PEPPERS

This year’s red and yellow peppers will once again be sourced from Neimeng and Shanxi Provinces, regions known for their favourable climates and low pesticide usage. The planting area for both varieties has increased. If weather conditions remain stable over the next three months, it is likely that we will see a reduction in prices. In contrast, green pepper prices are expected to stay consistent with last year. It is important to note that orders for peppers must be confirmed before July to ensure supply continuity.

PERUVIAN YELLOW CHILLI

Although production of yellow chilli is possible, the current challenge lies in meeting the pesticide and heavy metal residue requirements of certain destination markets, particularly in Europe. As most of the current cultivation is intended for local consumption, export-dedicated fields are limited in both scale and compliance.

PERUVIAN AVOCADO

The Peruvian avocado peak season is now underway. Prices have increased slightly this year due to rising costs of raw material and labour. Additionally, strong demand for fresh avocado exports has led to higher freight costs, though these are expected to ease in the coming weeks as the shipping market stabilises.

SHIPPING AND LOGISTICS UPDATE

According to our logistics specialist, the recent earthquake in Southeast Asia is not expected to cause widespread disruption to shipments from Thailand to the UK, thanks to the robustness of Bangkok’s transport infrastructure. In Myanmar, some localised delays are possible, particularly for goods requiring overland transport from central regions to Yangon. However, overall impact on UK-bound shipments is likely to be limited. Ongoing updates will clarify any potential bottlenecks.

Freight rates have remained low in recent months, with carriers unable to implement planned General Rate Increases (GRIs) due to subdued post-Chinese New Year demand. Some capacity has been withdrawn from circulation by major carriers such as Cosco and Hapag-Lloyd in an effort to tighten the market and drive prices higher. A modest rate increase is anticipated toward the end of April, but whether this will hold remains uncertain.

Looking further ahead, rates are expected to stay low through the early summer. However, a significant rise is forecast as we approach the Christmas season, when carriers typically seek to maximise earnings during peak demand. Complicating this forecast is the escalating trade tension between the US and UK, and the potential for broader conflict if Europe chooses to engage in a wider trade dispute with the US. Should this materialise, the knock-on effects on freight pricing and capacity could be substantial.

NOVEMBER 2024

SHIPPING AND LOGISTICS UPDATE

Freight costs between Asia and Europe have been volatile throughout 2024, with significant price increases due to several factors. Container rates from the Far East to Europe have risen sharply, driven by high demand and limited shipping capacity. Carriers have strategically blanked (canceled) sailings, effectively reducing space and pushing rates up by 30% compared to earlier this year, reaching around $4,100 per FEU by late October. This approach aligns with efforts to adjust to market fluctuations and boost rates following weaker pricing trends in the preceding months.

Additionally, geopolitical tensions, particularly in regions like the Red Sea, and the economic impacts of the ongoing U.S.-China trade restrictions have created further pressure on shipping lanes and logistics costs. Companies are diversifying by opting for alternative routes or using air freight to sidestep delays, though this comes at a premium.

These combined factors underscore the complexities of global logistics, particularly for businesses relying heavily on stable shipping costs between Asia and Europe.

CHINESE GINGER

The ginger harvest season is nearing its end. While the total planted area this year exceeds last season’s, severe flooding in summer and autumn led to significant crop losses, reducing the yield per hectare. As a result, the overall volume of raw ginger is roughly equivalent to last year’s. Currently, raw ginger prices are similar to those at this time last year. Typically, prices are at their lowest during harvest and are expected to rise gradually over the coming months until the next season in late 2025. Compliance with EU/UK pesticide standards remains a major challenge, but Frucom is committed to meeting these requirements. To this end, Frucom has opened markets in Peru and is actively sourcing and stocking ginger from Pichanaqui, Peru, where it meets these strict standards.

CHINESE GARLIC

The current inventory of this season’s garlic is smaller than at the same time last year, and prices are considerably higher. Prices are expected to continue increasing until the next season in June 2025. Frucom is also investing in infrastructure in Spain to establish a more sustainable garlic sourcing strategy, reducing dependency on Chinese supply. The Spanish garlic sourced by Frucom is frozen using a new, innovative technique that is more cost-effective; however, while pricing remains less competitive overall, this Spanish option provides an excellent alternative to Chinese garlic.

CHINESE ONIONS

Total inventory levels are comparable to last year’s. However, prices are significantly higher than in the summer/autumn, though still lower than at this point last year. Prices are expected to continue rising over the coming months, potentially peaking from Chinese New Year through to spring.

CHINESE PEPPERS

The pepper harvest season has concluded, with total volumes down by approximately 30%. Prices have reached record highs, with no suitable raw pepper material available until the next harvest in autumn 2025.

CHINESE CHILLIES

This season’s chilli harvest is complete, and fresh chillies will not be available until the next season. Compliance with EU/UK pesticide limits remains a challenge for much of the current supply. Frucom is actively sourcing chillies from South America, where they meet these standards, offering an excellent alternative.

AUGUST 2024

CHINESE GARLIC UPDATE

As previously informed, the Chinese garlic market situation for this season is proving more challenging than the previous one; the price of whole raw garlic has rapidly increased significantly. Some factors for this are as follows:

The total harvest yields have decreased by approximately 25%.
Severe floods in China this summer are likely to bring disease and given garlic’s perceived health benefits, consumer demands has increased and will continue to increase, thereby driving market requirements.
There has been a rise in garlic speculators investing in garlic options, which is the primary factor behind the very high prices this season.

Given these factors, it is difficult to predict what will happen with pricing over the rest of the season. We can only expect that prices will continue to rise and if there is a decline, it will be slow.

MAY 2024

SHIPPING AND LOGISTICS UPDATE

Rates for May are looking to increase from the 25th May. At present the market is very unpredictable and ever changing with the rates continuing to increase and cause carriers to cancel all long term rates, including FOB contracts.

These are some factors that are impacting the rates:

From China to Europe and Med market, due to Red Sea Crisis many vessels need to transit via Cape Good, which has caused shipping lines costs to increase. Furthermore, in recent developments, the Houthis in Yemen have stated they will expand their attack arrange from the Red sea to Mediterranean Sea. Many vessel have been attacked so vessel’s transit time will be longer than before.

The second main issue is equipment . Many shipping lines have had a lack of equipment due to increased transit from China to Africa. The vessel and shipping capacity is very limited but has since increased and caused congestion in Africa. Equally, there is increased congestion in Europe but due to transit time increase, many vessels are unable to go back to China in time causing further shortage.

The final and most important issue is that all shipping alliances have increased rates and flooded the market with similar levels across China Main Ports, with rates circa USD6000/6500 per HC. Due to the current global situation, it is a good time for them to control the market and increase rates accordingly.

We anticipate that the rates will continue to increase into June and July by an additional USD500 per TEU.

ONION MARKET GLOBALLY

Very high to near historical high prices for onions are seen on many markets in different parts of the world. This is driven by several factors, with the shortages being exacerbated by extended onion bans from traditionally large exporting countries of India and Egypt. European importers have turned to China to supply more onions due to the bans as well as lower production in most of Europe.

Spain is seeing high prices due to a smaller harvest volume. Given the higher prices Spanish producers are set to expand production this year.

CHINESE ONION

Spain is seeing high prices due to a smaller harvest volume. Given the higher prices Spanish producers are set to expand production this year.

CHINESE GARLIC

Although the acreage is similar to last year’s, this season is expecting to see a decrease of raw garlic material between 20% and 40%, due to unusual cold weather before and after Chinese New Year.

Price speculation has been stimulated and as a consequence, current pricing is much higher compared to last year’s.

CHINESE PEPPERS

This year, the acreage has decreased over 30% resulting on an significant decrease of raw material and expected higher pricing than last year.

PERUVIAN AVOCADO

An increase in temperatures of between 4 and 5 degrees Celsius is generating a reduction in fruit size due to unfavourable weather conditions linked to the El Niño phenomenon.

The size of the fruit is showing a slightly smaller trend, with a reduction ranging between 20% and 30% compared to initial expectations.

Production is also expected to decrease by at least 15% over the initial estimations, this means a drop of between 25% and 30% compared to the previous season.

As a result, it is expected that there will be an increase in prices in the international market.