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Behind the rising market of Angelica, opportunities and risks coexist!

 Last Update: 2022-11-04
 Source: Internet
 Author: User

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First, the market changes: the production capacity has dropped significantly, and the market continues to rise

Market conditions: At the beginning of new production, the attention continued to increase, affected by high temperature and drought, the situation of dead seedlings intensified, and many merchants actively purchased, driving the market to continue to rise; At present, the price of angelica in the market is 58-63 yuan (kg price, the same below), and the price of angelica tablets is 70-80 yuan
.

Origin information: affected by the epidemic, the amount of goods in the production area has been small, due to high temperature and drought and policy intervention, the overall production capacity has decreased significantly this year, the reluctance of holders to sell has strengthened, the market is stable and rising, the current production area grass angelica price is 48-55 yuan, loose angelica is priced at 55-60 yuan, ten angelica is priced at 80-85 yuan, and the price of skewer angelica heads is 85-105 yuan
.

Figure 1: Resource distribution in the main producing areas of angelica

Second, production changes: In the second quarter, the rate of dead seedlings of angelica increased due to high temperature and drought

Figure 2: Temperature and rainfall in Gansu, Qinghai and Yunnan provinces from January to August 2022

From the perspective of temperature changes: the temperature in the first quarter of 2022 was low, and the high temperature in the second quarter was prominent
.
In the first quarter of 2022, the temperature in Gansu, Qinghai and Yunnan provinces, the main producing areas of Angelica, was significantly 1°C lower than the same period in 2021, resulting in a delay
in the germination time of Angelica plants compared to 2021.

In the second quarter of 2022, the temperature began to rise rapidly in various places, and the persistence of high temperatures was more obvious, and the temperature in the main producing areas of Angelica except Yunnan Province, Gansu Province and Qinghai Province was significantly higher than the same period in 2021
.

Due to the rapid rise in temperature, the transpiration of angelica plants is intensified, and the stability and effective supply of water sources are the effective guarantee for
the critical period of angelica growth.

From the perspective of rainfall changes: the rainfall in the first quarter of 2022 was heavy, and the drought situation in the second quarter was prominent
.
In the first quarter of 2022, the rainfall in Gansu Province, Qinghai Province and Yunnan Province, the main producing areas of Angelica, was significantly higher than the same period in 2021, and the Angelica plants obtained effective water source guarantee
during the germination period.

However, by the second quarter of 2022, the temperature began to rise rapidly in various places, coupled with the entrenchment of the continental subtropical high pressure, causing an abnormal atmospheric circulation, resulting in sustained high temperatures and a significant decrease in
rainfall.
The rainfall in Gansu, the main producing area of Angelica, was only 39.
69% of the same period in 2021, while the rainfall in Qinghai and Yunnan changed by about
10% compared with the same period in 2021.

Due to insufficient rainfall during the critical growth period, wilting of angelica plants and the rate of dead seedlings climbing, angelica planting in Gansu was the most affected, while angelica cultivation in Qinghai and Yunnan provinces was relatively less
affected.

3.
Historical prices: Every abnormal climate will trigger a rollercoaster market

Figure 3: Changes in Angelica raw material prices from 1985.
01 to 2022.
10

From the perspective of market changes: from 1985 to 2022, the angelica market has experienced 3 stages:

Phase 1 (1985-2007): Low prices led to a reduction in production in the production area, coupled with the impact of drought, Angelica ushered in the first historical sky-high price
.
The price of angelica rose from the lowest 1.
40 yuan in 1986 to the highest of 65 yuan in 2007, an increase of 45.
43 times, with a compound growth rate of 18.
16%.

The first stage lasted 23 years, stimulated by high prices, and the Angelica production area began to extend to the surrounding provinces with the origin as the center, laying the groundwork for the rapid decline of the subsequent market
.

The second stage (2007-2013): Angelica social demand ushered in explosive growth, but due to years of low prices, production has decreased significantly, and under the influence of abnormal climate, the market ushered in a small peak
.
The price of angelica fell from 65 yuan in 2007 to a low of 8 yuan in 2009, a decline of 87.
69%.

After that, the market bottomed out and rebounded, rising to 52 yuan in 2013, an increase of 5.
50 times
.

The second stage lasted 7 years, and the price correction and production reduction became the basis for this round of angelica market rise, especially the hail disaster and rainy weather in 2013, which caused angelica production capacity to drop by more than 50%, which became a booster for the market rise
.
However, under the high income, the production area has opened another round of great development, and it is inevitable
that the market will fall.

The third stage (2013-2022): abnormal changes in the climate during the critical growth period have led to a decrease in the production capacity of angelica and an increase
in the rate of dead seedlings.
The price of angelica fell from 52 yuan in 2013 to 22 yuan at the lowest in 2020, a decline of 57.
69%; After that, it bottomed out and rebounded, and rose to 54 yuan in 2022, up 1.
45 times
.

The third stage lasted 10 years, affected by the rise in production costs and labor costs, the angelica market showed range-bound characteristics, and constantly touched the production cost line, resulting in a continuous reduction
in production in the production area.
At the same time, after 2020, the global climate anomaly is prominent, which has brought great trouble to agricultural production, coupled with the impact of the national grain protection policy in 2022, the angelica market has jumped again
.

Through the comparative analysis of three stages, my platform found that every market outbreak of Angelica is positively correlated with climatic factors, and at the same time, in the early stage of the market outbreak, the price of Angelica continues to impact production costs, triggering rapid production reductions
in various production areas.
However, the subsequent high price market also has an easy impact on the production and price of angelica, and the cliff diving market often occurs
after the high price market.

Fourth, the change of income: the planting cost is controllable, and the net income of mu yield is quite abundant

Figure 4: 2020.
01-2022.
10 Angelica mu net income

From the perspective of planting costs: production costs have been relatively stable for three consecutive years, and input costs are in a controllable range
.
Affected by the market decline in 2018, large households abandoned seeds and retail farmers expanded seeds in various producing areas of Angelica, resulting in a continuous decline
in seed and seedling prices due to the large number of seeds and seedlings remaining.
The production cost of angelica fell from 3470.
00 yuan per mu in 2020 to 2945.
00 yuan per mu in 2022, a decrease of 15.
13%.

Angelica production expenditure is mainly the cost of seed seedlings, leased land, labor and material costs, except for the cost of seedlings is easily affected by external factors, the rest of the expenditure costs are relatively stable
.

From the perspective of net income: in the past three years, the net income of angelica planting has continued to grow steadily, and the income of farmers is very considerable
.
In 2020, as the angelica market continues to impact production costs, under the background of production reduction and continuous digestion of inventory, the angelica market has steadily climbed, and the net income of mu production has also increased from 4230.
00 yuan / mu in 2020 to 15955.
00 yuan / mu in 2022, an increase of 2.
69 times, with a compound growth rate of 55.
66%.

Especially in the past two years, due to the reduction of production and the decline in production capacity, the net income of angelica mu has risen rapidly, which is very attractive to growers in the production area, in addition to the expansion of retail planting, large planters have also participated in angelica planting again, and the situation of overcapacity of angelica will surely appear
again in the future.

Fifth, demand changes: demand growth in multiple channels is obvious

Angelica has the functions of tonifying blood, regulating menstruation and relieving pain, moisturizing and smoothing the
intestines, anti-cancer, anti-aging and anti-aging.
In recent years, in addition to the obvious growth in demand for medicinal channels, the consumption growth in the field of edibles, health products and extracts is also significant
.

According to statistics from the big data platform of Tiandi Cloud Map Chinese medicine industry, the amount of angelica used in the country was about 36,600 tons in 2020 and about 37,300 tons
in 2021.
Among them, from the data monitoring of proprietary Chinese medicines currently in circulation, there are 1656 kinds of proprietary Chinese medicines containing angelica in their ingredients, accounting for 21.
50% of the 7702 proprietary Chinese medicines monitored by the platform, such as ejiao angelica granules, gynecological Qianjin series, ejiao angelica mixture, Xiaoyao pills, Baizi Yangxin pills, etc
.

VI.
Summary

1.
Abnormal climate has become the booster of this market rise The decline in the market in the past three years has led to a significant reduction in production in various producing areas of Angelica, laying a favorable foundation
for the market to rise.
At the same time, in 2021 and 2022, due to the influence of La Niña, the global climate is volatile, which has a great impact
on agricultural production.
Under the reduction of production capacity, abnormal climate, popularity and capital operation, the angelica market rose
.

2.
Under the guidance of high returns, the problem of disorderly development of production will be highlighted Angelica has had a net income of more than 6,000 yuan per mu for nearly one year, and compared with other cash crops, the planting income is very considerable, and the planting enthusiasm of farmers in the producing area has been ignited
again.
Due to the widespread problem of continuous planting of crops, the production of angelica will be concentrated in emerging production areas in the future, and the planting in new production areas and new development areas will usher in new growth points
.

3.
Under the background of inflation, popularity gathers strongly In the context of the lack of hot spots in the market and inflation, agricultural and sideline products, especially Chinese herbal medicines, in rigid demand, are easily concerned by capital and speculators, and drought has obviously boosted this market enthusiasm
.
At present, in the main producing areas of Gansu, whether it is a pharmaceutical farmer, a large business or a stockist, it is generally optimistic about the market market of this variety, forming a strong popularity gathering
.

It is worth noting that on the one hand, due to the rapid increase in the net income of angelica per mu in 2021, various producing areas have successively carried out recovery production or expanded planting; On the other hand, the global financial crisis and shrinking demand have caused the consumption of a variety of Chinese medicine raw materials to decline
.
Once the price of angelica climbs too fast, it is easy to cause an embarrassing situation of "blocking in front and chasing soldiers in the back", so that angelica gradually changes from "fragrant preserve" to "hot potato", and the market risk coefficient increases
.

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