USA

Garlic harvest will start around the 7th of July, typical for the Californian season. Weather
has been good in the growing area, which is quite concentrated in the Central Valley of
California, versus onion which is grown throughout the State. Higher grower costs as
land rents continue to climb in the Central Valley. Many growers are switching over from
row crops (onion, garlic, watermelon, tomatoes, etc.) to more permanent crops
(almonds, pistachios, walnuts, etc.), which means less availability for land to grow onion
and garlic crops and farmers looking to increase their revenue base with less water
intensive growing operations. New food safety regulations plus added labor costs
related to wage and insurance increases are driving up operating expenses. More
information will come regarding pricing by end of August and early September.

China

The Chinese garlic market is fairly quiet leading into new season compared to the
excitement looking into May 2017 crop. Field research and reports coming from the
growing regions are indicating 2018 will be a bumper garlic crop. Early harvests have
begun for fresh garlic in some regions and will continue through to June and July.

Pricing at origin is on a sharp decline, with the indications of a bumper 2018 crop, the
prices of fresh and dried garlic to continue to soften.
It is estimated that this tendency will last through the new season. Stimulated by the
prosperous markets in the past two seasons the planting areas have continued to grow
and the 2018 planting capacity is outside of the regular Chinese growing patterns. It is
forecasted that the yield of fresh garlic will reach 6 – 6.5 million pounds, while for
dehydrated garlic due to a possible abundance of fresh garlic this will all be pushed into
dehydrated production, which according to the industry information the capacity of
dehydration nationwide could reach 8000MT per day. The yield of dried garlic flake for
2018 could reach amazingly high inventory levels if all remains constant during the
whole harvest season. Added to this, there is an expected carryover of the 2017 crop of
dried garlic which is estimated to be around 0.1 million metric tons.