Chinese traders suddenly stop buying VN litchis
Chinese traders suddenly stop buying VN litchis
The price for Bac Giang litchis dropped to VND3,000-VND15,000 per kilo after Chinese traders unexpectedly stopped purchasing litchis in Bac Giang province.
Farmers in Luc Ngan District, the major litchi growing area of Bac Giang and Vietnam, are very worried right now. To sell nearly 500 kg of litchis on the morning of June 30, at the price of VND12,000/kg ($0.5), Mr. Phung Tran Hoat had to see several litchi traders.
“Most of the points to collect litchis for Chinese traders in Luc Ngan have closed. The purchasing power of domestic businesses is moderate. I’m very lucky today to sell this volume of litchi,” he said.
Local farmers said in previous years Chinese traders did not halt purchasing litchi until the end of the season, but this year they stopped buying when the litchi season was two-thirds finished. This is also the main reason for the the price fall by 50-70% in the past few days.
Ms. Nguyen Thi Loan was not as lucky as Mr. Hoat because she had to sell her litchis for VND4,000 a kilo - the lowest since the beginning of the season. Previously, she had sold her fruits for VND12,000-VND15,000 per kilo. The earning was not enough to pay for litchi pickers, who are paid VND200,000 ($9)/day/person.
In Loan’s hamlet, several families will have to collect 20 tons of litchis in the next few days while the prices are anticipated to still be low.
Several days ago, Mr. Tran Van Hanh could sell his good quality litchis for VND30,000-VND35,000 per kilo but now the prices have dropped to about VND20,000/kg. “But it is quite hard to seek the buyers," he admitted.
Hanh will harvest about 8 tons of fruits in the next couples of days. He plans to sell it to traders from southern province at the price of VND13,000-VND14000/kg. However he is not sure as the purchasing power of domestic traders is normally low.
A Vietnamese trader said this year that he had sold several hundred tons of litchis in the southern market, but profit was modest. He said this is the common situation of litchi traders because this year a large number of Chinese traders had flocked to Bac Giang to collect litchis.
"The price for litchi was pushed to VND37,000/kg because of competition among traders. As they did not earn much from litchis, they stopped purchasing the fruits," he explained. “Moreover, the quality of fruits at the end of the season is not as good as the early period.”
Le Ba Thanh, Vice Chairman of Luc Ngan district, said that Chinese traders stopped buying Vietnamese litchis because this is the harvest time of litchis in Guangzhou, China. Moreover, Fujian and Sichuan, the major consumption market of Vietnam litchis, are at peak of heat so the demand for litchis has dropped.
Thanh said as of June 29 Luc Ngan had sold nearly 100,000 tons of litchis. The litchi season is expected to end on July 5. As the quality of litchis at the end of the season is not very good, the local government urged farmers to sell their products to the domestic market only.
"Nearly 90% of Luc Ngan’s litchi output was sold at a high price; the remaining 10% will certainly sell," Thanh said.
A representative from the Ministry of Trade and Industry said the ministry would take measures to support litchi farmers.
