US asparagus market oversupplied due to coronavirus
March 13, 2020
The Mintec US asparagus price witnessed a 40.4% decline between 19th January 2020 and 19th February 2020 , due to higher imports from Caborca, Mexico.
Mexico accounts for 30% of the world’s asparagus exports, and the coronavirus has impacted its export channels. The country has seen a reduction in exports to Asia, with Asian countries demanding less asparagus. This is due to a downturn in economic activity because of reduced travel and widespread lockdowns, to control the spread of coronavirus. As a result, asparagus usually destined for the Asian market is being redirected to the US.
The US continues to import asparagus from Mexico due to its low prices, high quality and the uncertainty surrounding the future implications of the coronavirus outbreak. The proximity of the US to Mexico provides an additional benefit for US importers. Furthermore, the limited number of cases of the coronavirus in Mexico, in comparison to other countries provides the US with better confidence of dealing with a relatively secure trading partner.
The Caborca season usually ends in April, and thereafter the US market is supplied with Californian asparagus . The low prices this season may prompt Californian farmers to substitute to other crops with potentially higher margins. Thus, the Mintec US asparagus price is expected to see limited downward movements in the next few months, as some US producers are expected to cut down their asparagus production.