India traders have a 98% monopoly of Nepal’s ginger export, so farmers from Nepal are exploring new international markets

Nepal, the world’s third largest ginger producer after India and China, is seeking new export destinations not only for its raw ginger but also processed ginger products.

To build up the country’s capacity to produce processed ginger products, Nepalese ginger producers and traders are now installing a rhizome washing facility with 100 metric tonne daily cleaning capacity at Dhulabari of Jhapa in the eastern region. The region is also the center of ginger cultivation in Nepal.

“Since the farmers, for many years, have not been able to get fair prices of ginger in the Indian market owing to soil content and dirty look, we have started to put up a modern ginger washing facility to enable Nepal to get better price in third countries,” said Narendra Kumar Khadka, president of the Nepal Ginger Producers and Traders Association (NGPTA).

NGPTA is supported by Nepal Enhanced Capacities for Trade and Development (NECTRADE) project under Ministry of Commerce and Supplies (MoCS) to establish a washing facility along with enhanced cultivation methods, efficient processing and improved storage facilities.

“The Enhanced Integrated Framework (EIF) and World Trade Organization Standards and Trade Development Facility (WTO-STDF) have funded 11 million U.S. dollars to enhance the capacity of ginger producers in Jhapa, Panchthar, Ilam and Morang districts,” said Toya Narayan Gynwali, joint secretary at MoCS, who is coordinating the overall process of EIF Nepal.

Ginger is one of the potential products of Nepal that have been identified for export.

According to Kumar Khadka, Nepal will be exporting processed ginger to the European and Middle East countries by next year “if everything goes as planned.”

Statistics from the Food and Agriculture Organization (FAO) showed that Nepal has produced 216,289 tonnes of ginger in 2010- 2011, securing the third position in the list of largest producers after India and China.

Records of Ministry of Agriculture Development (MoAD) also showed that in the year 2011-2012, though the production has declined slightly by 0.3 percent to 215,613 tonnes, the productivity of ginger has jumped by 8.7 percent, yielding 11.75 kilograms per hectare compared to the ratio of 10.81 kilograms per hectare in the previous year. Despite large production, Nepalese producers and traders have heavily relied on Indian middlemen in exporting their products.

“Almost 98 percent of our fresh ginger is taken by the Indian middlemen. Once they manage to wash the ginger in border cities like Silguri, Naxalbari and Lucknow of India, they sell it for 60 to 80 rupees per kilogram for which Nepalese farmers get only 20 to 25 rupees,” Kumar Khadka said.

Ginger is cultivated by over 66,000 families in five regions of the country. However, because of its inability to diversify its export market, Nepal is losing tens of millions of U.S. dollars from its earnings in ginger production.

Aside from India, which itself a big ginger producer, Nepal is now eyeing countries like the U.S., Saudi Arabia, United Kingdom, Japan and Spain, which are among the world’s largest consumers of ginger, as their export destinations.

Nepalese ginger producers have sought technical assistance from China, which was able to increase its ginger production each year by using modern technology.

“We are planning to develop some kind of exchange visit programs for the exporters and farmers from Nepal to China by which we can learn so many things on ginger production, post- harvest, handling, storage and marketing as well.” Kumar Khadka said. Endi

– Courtesy