Information for fruit and vegetables business in CIS
Prices on cabbage head all the records
Prices on the wholesale parties of white cabbage reached this week USD $ 0.53-0.6/kg, it is a doubtless record of the recent years. Past week the cabbage prices grew on 20-30%; moreover, the strong deficit on this commodity is observed. As the market players reported, cabbage reserves are practically exhausted. The supply is insufficient even in Lviv oblast, the traditional leader of cabbage production in Ukraine; the supplied parties are of a rather low quality.
According to the data of State Committee of Statistics, in 2004 the croppage of cabbage was 1% greater than the 2003 level. However, the present situation, market players' information and AMP assessments prove that in 2004 cabbage production was lower than the 2003 level on 15-20%.
High price on cabbage can be explained by several factors. As the practice shows, mainly the producers take into account first of all the past season price level when they are making decision on this or that crop production. So, the low price on cabbage in the season 2003/04 (in April 2004 it was USD $ 0.05-0.06/kg) influenced the decision on cabbage production; many producers decreased the acreage of cabbage production fields (as AMP estimated, the fields were contracted on 19%). At the same time, this year the cabbage yield was very high, and the producers did not believe the messages of the significant decrease of gross yield as the result of cabbage production lands contraction. They did not expected the deficit on this commodity and the respective high price, the majority of producers tried to sell cabbage as soon as possible and considered its storage as unprofitable. In some cases cabbage was even left on filed. So, cabbage supply has been excessive and prices on this commodity have been moderate nearly till February 2005. When the cabbage deficit became obvious, the prices on this commodity jumped up. During 2 months the price on cabbage has increased three times.
We can expect that in 2005 the acreage of cabbage production lands may be extended significantly. Earlier AMP prognosed 5% acreage extension; however now it is clear that this prognosis should be reconsidered in the direction of its increase.