Market Report on Herbs and
Spices
April 2000
By the Herb Research Foundation
Market Overview
The overall theme for the herb market right now is oversupply
and low demand, according to the six major buyers we consulted.
Both domestic and international markets are overstocked with
raw materials, leading to a consistent decline in prices over
the past two years. This is particularly true of medicinal herbs
such as echinacea and St. John’s wort, which have been greatly
overproduced. Presently, only a few items appear to be in short
supply. In the spice world, there have been shortages of cardamom
and allspice. On the medicinal herb front, the catnip crop suffered
due to a poor germination rate this year. One of our sources
reports a shortage of certain organic Southeast Asian crops,
including nutmeg. For herbal teas, one of our sources indicated
a need for hibiscus, rosehips and lemongrass, and quality problems
with red clover. Caution is advised, however, on lemongrass,
which is usually very abundant and inexpensive. The year 2000
red clover crop will be harvested starting in late May and June,
so the shortage of this ingredient may soon disappear. Another
source notes that there is less wildcrafting (picking from the
wild) in many countries than in previous years, and that growers
are not planting herbs because of current oversupply. Consequently,
there may be shortages in the future, accompanied by higher
prices.
In spite of the "somewhat depressed" nature of the
current market, mergers and consolidations continue at a rapid
pace, keeping the market interesting and volatile.Stay tuned…
Growers’ Guidelines
Purity of raw materials is an area of major concern to US buyers.
One of our sources
commented that growers from developing countries may focus
on quality, but lack awareness and education about purity. For
example, a carefully cultivated herb crop may be contaminated
by bugs during storage, turning a high quality product into
a substandard one. Another barrier to doing business with S.
African growers and producers is their requirement that buyers
pay in advance. This is highly unusual in most commodity markets,
and favorable terms can make the difference in purchasing decisions.
Market Prices for Medicinal Herbs
Black Cohosh (Cimicifuga racemosa)
Prices for this North American root range from $1.50/kg to
$15/kg. Currently, black cohosh is considered "at risk"
of commercial over-harvesting from the American forests where
it is wild-harvested. The majority of black cohosh is still
exported to Europe for use in popular menopause products, such
as Remifemin. Black cohosh is relatively easy to grow and there
has been a trend toward cultivation in Europe. Certified organic
materials command higher prices.
Buchu (Agathosma betulina)
There is currently a ban on importation of buchu into the United
States, and demand for the plant is slight. None of our correspondants
are buying buchu. A certified cultivated supply may be able
to pique interest. HRF is investigating the import ban to determine
if exceptions are possible for cultivated material.
Devil’s Claw (Harpagophytum procumbens)
Prices for devil’s claw range from $3.00/kg to $5.00/kg. Devil’s
claw is more popular in Europe than in the US. In the US, glucosamine
sulfate and chondroitin sulfate are the ingredients of choice
for arthritis products. Devil’s claw desperately needs credible
clinical support for the joint health indication, which is one
of the most lucrative markets in the world. It is somewhat surprising
that companies with so much to gain from promoting this ingredient
have not sponsored the research that could put it on the map
as a viable remedy for arthritis relief.
Echinacea (Echinacea purpurea)
Echinacea’s popularity in the West has led to such large-scale
overproduction that it is practically "free," according
to major herb buyers. The going rate for E. purpurea
has bottomed out at around $1/kg for herb and $8/kg for root.
E. angustifolia continues to garner higher prices, approximately
$40 to $60/Lg, even though there is no scientific evidence to
suggest that this species has more potent immune-stimulating
properties. One buyer estimates that there is enough echinacea
in warehouses to last the next two years at current sales rates.
Ginseng (Panax ginseng)
The price for Panax ginseng varies widely, depending
on the source and quality. Prices for Chinese ginseng are generally
the lowest, ranging from $26 to 40/kg. American ginseng (Panax
quinquefolius) is currently selling for roughly $40/kg.
Korean ginseng consistently brings the highest prices, ranging
from $66 to 88/kg.
Goldenseal (Hydrastis canadensis)
Goldenseal is one of the few medicinal plants for which inadequate
supply and high cost continue to be issues. The majority of
goldenseal root comes from dwindling wild populations in North
America, although some cultivation has begun. Prices currently
range from $66 to $110/kg, but can reach over $200/kg depending
on the time of year. One of our sources purchases only organically
cultivated goldenseal, which costs between $110 to $132/kg,
an price roughly 10% higher than for wildcrafted material. Goldenseal
is now listed as an endangered specie by CITES, so efforts to
cultivate it are essential.
As more goldenseal comes under cultivation, prices will drop
accordingly. Cultivation seems to be on the rise, according
to a 1998 tonnage survey commissioned by the American Herbal
Products Association (AHPA). In 1998, only 2.5% of goldenseal
on the market came from cultivated sources. The AHPA survey
projected that from the years 1999 to 2003, as much as 19% of
goldenseal may be cultivated. Watch for an update on goldenseal
in upcoming HRF market reports, following the release of AHPA’s
1999 survey.
Hibiscus (Hibiscus sabdariffa)
Conventionally grown hibiscus currently ranges in price from
$1 to 4 per kg, but most buyers will not go above $2.40 per
kg. One source quoted a price of up to $12/kg for certified
organic hibiscus, , but we are skeptical.
Rooibos (Aspalathus linearis)
The price range for rooibos is currently $2 to $4/kg.
St. John’s wort (Hypericum perforatum)
Due to massive overproduction, St. John’s wort is not faring
any better than echinacea on the worldwide market. Maximum price
is 2 to 6/kg, depending on hypericin content, but most claimed
the price is well below $2/kg for conventionally grown St. John’s
wort. Even certified organic crops command only $6 to 8/kg,
which is startlingly close to the price of conventional crops
just one year ago. Last summer, Chilean farmers chose to burn
their crops in the field, rather than to harvest for such low
prices.
Valerian (Valeriana officinalis)
Valerian ranges in price from $2.5 to 10 / Kg, depending on
the origin and quality. Highest prices are for certified organic.
Pygeum (Prunus africana)
None of our sources reported buying pygeum.
Gotu kola (Centella asiatica)
Most of the gotu kola on the market is of very poor quality.
In fact, it is consistently referred to as a "dirty herb"
because it is so difficult to find an uncontaminated source.
(In India, gotu kola is commonly harvested from ditches that
are contaminated with heavy metals, pollutants, and other harmful
chemicals.) Prices for this herb range from $2 to 4 /kg. Buyers
often resort to testing tons of samples before finding one that
passes their purity standards; others have stopped buying gotu
kola altogether. This plant represents an opportunity for the
production of clean material.
– R. McCaleb, K. Morien, T. Schott, April 2000
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