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| Farmgate Prices of Ginseng, Echinacea and St Johnswort |
Answered by: Conrad Richter
Question from: Ron Abbott
Posted on: July 31, 1998
I am trying to ascertain the following: the farm gate price paid to farmers for ginseng, echinacea and St Johnswort over the past several years, present prices, and forecasted prices if possible.
It is difficult to ascertain market prices of many bulk botanicals because there is little exchange of price information in the marketplace; certainly nothing like, say, the corn or soybean markets. The people who are in the best position to know this information, the buyers, are loath to reveal this information because it might reduce the bargaining strength they currently enjoy in the case of many herb crops. What information we do have is anecdotal and difficult to verify. It is not possible to give year-by-year farm gate prices; these are generalizations of reports received over the past 2-3 years.
As of 1998, ginseng prices have been at historic lows, trading around $55 per kilogram (Canadian dollars). Chai-Na-Tai Ltd., the world’s largest grower of American ginseng, with farms in British Columbia and Ontario, announced recently that it would hold back its production from the market in the hope that prices will rise. We are not privy to recent prices paid to know whether this strategy has had any effect on farm gate prices. Woodsgrown ginseng is commanding higher prices, and it is still possible to sell wild ginseng legally in a few U.S. States (at upwards of $500 per kilogram).
We have received some anecdotal reports suggest that growers are getting (all in Canadian dollars) $50 to $65 per kilogram for Echinacea pallida and E. angustifolia roots, and $25 per kilogram for E. purpurea roots. For E. purpurea herb (the above ground parts) growers are getting the in area of $6 per kilogram and less.
St. Johnswort herb prices paid to growers have been in the area of $12 to $15 per kilogram (Canadian dollars).
Quality and volume effects the price considerably. St. Johnswort herb with less than 0.1% (by dry weight) hypericin will be difficult to sell, as would Echinacea angustifolia and E. pallida roots with less than 1% echinacosides. Gross characters such as colour, cleanliness, size, etc. all have an impact on prices of bulk botanicals.
Where are prices likely to go in the future? Very difficult to say given the poor price data available. We can only guess where prices are going.
It appears likely that ginseng could drop further because a lot of new acreage was planted in the past 2-3 years and are yet to yield harvests. Some ginseng acreage is not being replanted in ginseng as growers diversify to other woodland herbs such as goldenseal and black cohosh, but the percentage of acreage devoted to these new crops is very small so far. With the major market for ginseng still in the Orient, the price is not likely to find major support until the Asian economic crisis abates.
Echinacea and St. Johnswort are likely to hold or drop slightly over the next few years as demand continues to grow. Neither of these herbs have reached market saturation in North America yet. However, the acreage planted of these two crops has expanded considerably in the past 1-2 years.