Canadian supply of ginseng piles up after coronavirus puts trade on hold

FILE PHOTO: Ginseng. Getty Images

The pandemic’s crushing effect on international travel has grounded Canadian exports of ginseng, a root widely used in Asia to treat everything from the common cold to impotency, at a time when health is top of consumers’ minds.

Canada is the world’s second-largest ginseng exporter after China, with most of its exports shipped to Hong Kong on their way to mainland China, Singapore and Taiwan.

The pandemic has devastated the niche trade, however, in another example of the virus’s disruption to the global food and agriculture supply chain. Outbreaks have also stopped fruit shipments, shut down meat plants and sickened migrant farm workers.

Farmers in the United States, the fourth-largest exporter, are suffering too.

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A ginseng crop can take up to five years to grow. But even as he starts this year’s harvest, Remi Van De Slyke in Norfolk County, Ontario, has a barn full of last year’s ginseng.

The problem is that travel restrictions have stopped Chinese buyers from visiting to check the crop, which has depressed sales.

Canada’s diplomatic strains with Beijing haven’t helped, said Van De Slyke, chairman of Ontario Ginseng Growers Association.

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“Everyone is locked down and that’s causing us a big problem,” he said. “We’re hit in all directions here.”

Across Canada, as much as 1.8 million pounds, or 20 per cent of last year’s crop, remains unsold, said Rebecca Coates, executive director of the Ontario growers association.

Canada shipped 354,305 kg worth C$11 million to Hong Kong from May through July this year as coronavirus infections peaked in Canada, one-third of the value from the same period a year earlier.

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Lately, some buyers have been “circling like sharks” to see if they can purchase for less than the production cost, Coates said.

Health awareness rising

Demand in China looks strong.

A Chinese medicine trader who is a long-time Canadian ginseng importer based in Xiamen city, Fujian province, says health is an even greater concern after the pandemic.

“After COVID-19, people’s awareness for health care may rise more than before (and) we may increase our imports as well,” the trader said.

Sales of Chinese-grown ginseng have spiked recently as a substitute for costlier imports, said a salesperson at a Chinese medicine shop in Baotou, Inner Mongolia.

Wholesale importers have been known to purchase as much as 100,000 pounds of ginseng individually at Ontario-based Great Mountain Ginseng, which was forced to shut its retail stores, including one at Niagara Falls, during spring lockdowns.

The stores have reopened, but the buyers and tourists have not come back, said general manager Schelling Yeh.

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“We’ve been hit hard,” Yeh said. “If you’re unable to see the product are you willing to buy it?”

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Canada’s agriculture ministry is trying to help the ginseng sector diversify to other markets, spokesman James Watson said.

Across the border, most U.S. ginseng is grown in Wisconsin. President Donald Trump, who is running for re-election on Nov. 3, noted farmers’ pain as he announced a new round of pandemic aid in the battleground state.

But Trump’s conflicts with Chinese leadership over trade issues have done more to discourage U.S. sales to China than the coronavirus crisis, said Wisconsin farmer Mike Burmeister.

“Chinese trade is so important to my industry. The world really is a small place when it comes to ginseng.”

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