6 March 2007 - A global shortage in tomato paste resulted in soaring export prices of China's related products, which brought more opportunities to its 'red' industry, but at the same time, it also raised accusations from overseas tomato paste industry saying that China's tomato paste enterprises were cornering the market, which was justifiably denied by China's tomato paste industry.
Presently in Northern Italy, tomato paste price soared up to 700 euro/ton while in Spain, the price reached 680 euro/ton, and in the meantime, tomato paste was sold out in both Europe and U.S. The global shortage in tomato paste spurred China’s exports significantly. According to the statistics released by China Chamber of Commerce for I/E of Foodstuffs, Native Produce and Animal By-Products (CCCFNA), in 2006, China’s tomato paste export volume reached 630 million kilograms, a 4.71% increase over the previous year, which totaled $360 million, up by 18.8% year on year while the unit price attained $566/ton, and realized a 13.46% growth.
Witnessing China’s tremendous success and increase in tomato paste exports, some people from overseas tomato paste industry assumed that China was taking advantage of the global shortage in tomato paste and cornering the market. These accusations were strongly opposed by officials representing the CCCFNA, who indicated that China’s tomato paste producers used to sign an annual sales contract with overseas importers in early August each year; although price fluctuation may still happen, the risk is shared by both exporter and importer.
In 2006, due to bad weather in Greece, its tomato output was only 710,000 tons, less than the 1 million tons expected, and at the same time, the U.S. also faced a decline in tomato output, which totaled 10.10 million tons, a 13% decrease than reckoned. Meanwhile China maintained its normal yearly output. The statistics indicated that in 2006, China’s tomato paste export volume to the U.S. reached 9.44 million kilograms, a 735.3% increase over the previous year, which realized $5.01 million of profit and went up by 933.2%.
Despite China’s huge output of tomato paste, it is still facing a shortage in raw material supplies; moreover, transportation also baffles the development of China’s tomato paste exports, because it takes 5 days to ship products from producing areas to export ports, and another 5 days to ship them to Europe.