Market Analysis of Ginger Crops in Nepal

An overview and commentary by The Spice Journal and a comprehensive report by USAID

“A market analysis of ginger production in Nepal” (available by clicking the tab at the bottom of this page) was undertaken by the Asia Network for Sustainable Agriculture and Bio resources (ANSAB), an independent, non-profit, Civil Society Organization, working throughout Asia. The study was commissioned by the Nepal Economic Agriculture and Trade Activity (NEAT) and funded by USAID.

>Ginger is an important Spice crop in Nepal, providing employment to 66,000 families.

Nepal is fourth in the world in producing ginger, representing about twelve per cent of world ginger production.

The NEAT study includes a comprehensive SWOT analysis of the dry ginger industry in Nepal, from cultivation to marketing, and it recommends a number of reasonable short term and long term solutions to enhance the industry.

If these recommendations are implemented, it would improve the quality of the product, improve production quantities, improve processing, and it would improve and strengthen the marketing system. Collectively this would lead to employment for thousands more farmers, it would increase per capita earnings of the farmers, and ultimately it would lead to an increased inflow of foreign currency into Nepal.

The organizations involved in this study of the production of dry ginger should be commended for a professional and comprehensive report. The Spice Journal will be following developments if and when the implementation phases of this project roll out.

Unfortunately there is little mention in the NEAT study about the feasibility of processing Nepal ginger, by steam distillation, into oils and oleoresins.

Essential oils and oleoresins are perhaps the fastest growing components of the spice industry. Most major buyers of ginger for use in the manufacture of soft drinks and bakery products, prefer spice oils and oleoresins instead of raw spices.

Spice oils and oleoresins provide consistency in flavour and aroma, as well they maintain a consistent high standard of hygiene; all are necessities for the global food and drink industry.

Many of our readers will be surprised to know that Coca Cola is the largest user of nutmeg in the world; and Coca Cola only procures nutmeg in the form of oil and oleoresins.

Considering that globally there are numerous manufacturers and bottlers of Ginger Ale and Ginger Beer, it follows that there must also be a large international market for ginger oil. Albeit, compared to nutmeg the yield of oil and oleoresins from ginger is quite low.

The NEAT study describes the overwhelming inefficiencies in transporting dry ginger to the international markets. Perhaps many of these inefficiencies would be overcome if the industry concentrated on the export of ginger oil and oleoresins instead of the raw product.

It is said by the local population that ginger grown in Nepal, particularly at the higher altitudes, has a pleasingly distinct flavour and aroma. If this aspect of Himalayan ginger is advertised and exploited, it could enhance the international demand for Nepal ginger.

Market Analysis of Ginger Crops in Nepal – contributed by USAID