Stinkin’ rose profit

Anastasio Vasquez dumps a box of garlic to be cleaned onto a

As Chinese consumers stockpile garlic to stave off H1N1 swine
flu, America’s largest grower of the stinking rose is reaping the
rewards of skyrocketing international demand.
As Chinese consumers stockpile garlic to stave off H1N1 swine flu, America’s largest grower of the stinking rose is reaping the rewards of skyrocketing international demand.

After weathering the worst season in 20 years, Christopher Ranch is “cautiously optimistic about 2010,” owner Bill Christopher said. Sales are up 15 percent and prices are up about 30 to 40 percent thanks to the shortage of Chinese garlic and a growing demand fueled by the belief that garlic helps prevent H1N1. Studies have shown garlic to be a powerful antioxidant, antibiotic and antibacterial agent, but no studies have definitively proven that garlic specifically wards off swine flu.

“Because of H1N1, people are eating more garlic,” Christopher said.

And because of the shortage of Asian garlic, the Chinese are even “dipping into the good stuff” – the higher quality Chinese garlic usually reserved for export – Christopher said. This year, China exported only about half the standard 200 million pounds of garlic it usually ships. Poor weather, fewer government subsidies and dwindling sales in previous years all contributed to this year’s smaller Chinese crop, Christopher explained.

“China provides over 70 percent of the world’s garlic so when they’re down 50 percent, it affects everyone,” Christopher said.

In recent months, prices of Chinese garlic more than tripled from about $8 to $24 for a 30-pound box. These days, Christopher’s product sells for even more – $40 to $50 per box. The company sells about 70 million pounds – or 2.3 million boxes – of garlic each year.

China may have halved its crop but Christopher Ranch planted about 3,500 acres – the same amount as usual – in Gilroy, Hollister, San Juan Bautista and the San Joaquin Valley, where ongoing water shortages only increase the price of production.

“If we had seen this coming, we would have planted a lot more,” Christopher said.

But based on the previous year, when an oversupply from China flooded the market and Christopher’s prices were down about 25 percent, local growers didn’t expect the supply shortage.

Just up the road at the Garlic Shoppe, where brothers Alex and Charlie Larson sell more than 4,000 garlic-inspired items, prices have stayed the same but the number of consumers clamoring for garlic and garlicky creations has increased.

“We’ve seen quite a few people increase their intake of garlic to help any type of infection,” Charlie Larson said.

A bulb of Christopher Ranch garlic goes for 60 cents at the Garlic Shoppe and garlic lovers swear by the locally grown herb.

“People want California garlic,” Charlie Larson said. “They don’t want Chinese. They trust the way ours is grown and handled.”

Other retailers have managed to keep their prices constant as well. A produce clerk at Safeway, who declined to give her name, said they haven’t changed their prices.

“It’s been the same since I’ve been here, and that’s about five years,” she said.

A bulb of California garlic goes for 50 cents at local Safeway and Nob Hill stores. At Arteaga’s Supersave, five bulbs of Chinese garlic sell for $1.19.

“The bigger the retailer the more constant they can keep their prices,” said Wendy Fink-Weber, director of communications for the Western Growers Association. “If you go to a big box store, prices are generally more constant.”

A Nob Hill spokeswoman said that “as a private company, we’re unable to share details on pricing strategy.” A Safeway spokeswoman also would not comment on how the company sets its prices.

The increase in the sale price of garlic won’t affect the Gilroy Garlic Festival either, said festival association Executive Director Brian Bowe. Fueled by two tons of fresh garlic donated by Christopher Ranch, the festival fills Gilroy with a mouthwatering, pungent aroma every July.

“We’ll give them the same amount of garlic,” Christopher said. “We always give them a good deal.”

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