Garlic wholesale price plunge suggests lack of oversight: scholar
Central News Agency
2014-08-13 11:10 PM
Taipei, Aug. 13 (CNA) The plunge of wholesale prices of locally grown garlic below production costs in April represents a failure of authorities to take preventative measures for market fluctuations, an agricultural expert said Wednesday. The wholesale garlic price at the place of production fell to NT$9 (US$0.3) per Taiwanese catty (600 grams) that month due to a glut, according to the Agriculture and Food Agency of the Council of Agriculture (COA). The price was far lower than the average farming cost of NT$18 per catty. After the COA provided subsidies for wholesalers to encourage market expansion, the price has rebounded to around NT$15 per catty, with some higher quality varieties selling at NT$18. Chen Chi-chung, a professor of applied economics at National Chung Hsing University, said authorities need to strengthen their existing measures for preventing farmers from growing more crops than the market demands. Since a harvest season is predictable, he suggested introducing garlic farmers to other channels for selling their produce instead of relying only on purchases from wholesalers. By doing this, the government can prevent a price collapse whenever supply outpaces demand, he said. COA calculations indicate that based on the amount of farmland dedicated to garlic over the past few years, farmers be able to get the best average wholesale price if garlic farming is limited to a total of 4,800 hectares nationwide each year. That would put output at 48,000 metric tons a year, an ideal volume that would sustain a good wholesale price, according to the council. Despite the council's recommendation, garlic farmland actually grew by 300 hectares this year, resulting in 5,000 metric tons more than last year. (By Yang Shu-min and Elizabeth Hsu)
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