So what happened to all the missing paprika on the store shelves?

How's this for weird? If you like to cook, somehow you can't go to the store to get a spice container of paprika anymore.

That's because there isn't any, the shelves are bare.

Lot of people are noticing these days. Tim Carney of the Washington Examiner pointed it out here and others chimed in:

 

 

I looked it up, and well, it has a reason:

 Turns out China has the corner on the global paprika market, controlling 70% of the supply, Xinjiang, China, to be exact.

You know, the same Xinjiang that has gone full-bore Mao, throwing people into 're-education' camps for the crime of being Uigher, an ethnic minority distrusted by the old gray men of Beijing. Probably the nastiest and most oppressive part of all China.

What's more, at least two trade news letters forecasted it.

According to Mintec, a U.K.-based data analytics company that specializes in supply chain pricing:

Other spices potentially to be impacted by disruptions to production and distribution include paprika, star anise and chilli. However, as of February 5th, the Mintec price of Chinese star anise sold in the US market was unchanged w-o-w or m-o-m.

Well, well, well. Higher prices = short supply.....

And according to Olam Spices, in a letter to its customers:

Today, China produces about 70% of the world’s paprika in its Xinjiang region. From there, the product is delivered to Shandong province, where most of the paprika processors, exporters and speculative holders are located, to service the global demand of paprika for the rest of the year. The country also grows 75% of the paprika that is processed in Europe — especially in Spain.

At this point, we expect that the following factors could possibly create supply chain disruptions from China:

  • Growers shifting from traditional paprika to a hotter hybrid variety
  • Delayed and limited availability of high-quality paprika
  • 2019 year-end holidays in the destination markets
  • Early start and mandatory government extension of the Chinese New Year holiday
  • The shutdown of processing facilities due to the coronavirus (2019-nCoV)

Even after the facilities open in China, it is expected that labor availability will be limited due to travel restrictions. Shipping from Chinese ports is also likely to start gradually, as many shipping lines have reduced the vessels coming out of China. The stock in destination markets is limited due to these reasons and we could possibly see shortages build in the short term. In addition, we do not anticipate sufficient quantities coming into the market from any major origin until Fall of 2020.

What we are seeing here is not just the problems of COVID, but quite likely, the problems of communism. COVID of course has hyper-empowered the state. but in a centrally planned economy, it's enabled bureaucrats to make all the decisions - which road you can take, which days you can work, which ports and shipping companies can work. The fingerprints are out there. This has the look of the signature shortages of socialism, in that the free market can't work to find a work-around to all the problems, because the state power is just too strong and with too little information makes all the calls.

And sure enough, China is now experiencing a food shortage, with authorities there demanding Chinese have "clean plate" program. The news accounts say it's centered on the Yangtze river region in central China where rice is grown, but it's quite possible that with supply chains, it has a knock on effect in northwest China's Xinjiang region. The rivers could have a marginal connection too, based on the maps.

But there's probably another reason, and this goes to President Trump and his concerns: Why does China have the global market for paprika cornered?

Theres's some kind of monopoly going on, not a free market, and the little guys have been chased out, likely unable to compete on price. Because after all, if you run a slave state, you don't pay much for the help.

That's chased thousands of little guys out of the market, little guys who should have their cut of it.

Where's the place where paprika should be grown? Not China. Paprika, according to Wikipedia, while popular and delicious in Hungarian and Spanish cuisine, is actually a Mexican and Central American product. The Mexicans and Guatemalans and Salvadorans should have the lion's share of this market, with all that nice volcanic soil, and the fact that the plants evolved in their region, probably tastes better, too. 

By some dynamic, China has priced them out, and chased them out. Yet their product is better. And lots of people in those part look to the U.S. for a better life instead of the gifts nature bestowed on their own.

It underlines that Trump is right about the vulnerability of global supply chains dominated by China, and the importance of diversifying the supply. It's time to free the global paprika supply from China's grip, and restore it the countries where it rightfully is theirs to contribute to and profit from  world markets. 

Image credit: Shareable Meme Generator meme

How's this for weird? If you like to cook, somehow you can't go to the store to get a spice container of paprika anymore.

That's because there isn't any, the shelves are bare.

Lot of people are noticing these days. Tim Carney of the Washington Examiner pointed it out here and others chimed in:

 

 

I looked it up, and well, it has a reason:

 Turns out China has the corner on the global paprika market, controlling 70% of the supply, Xinjiang, China, to be exact.

You know, the same Xinjiang that has gone full-bore Mao, throwing people into 're-education' camps for the crime of being Uigher, an ethnic minority distrusted by the old gray men of Beijing. Probably the nastiest and most oppressive part of all China.

What's more, at least two trade news letters forecasted it.

According to Mintec, a U.K.-based data analytics company that specializes in supply chain pricing:

Other spices potentially to be impacted by disruptions to production and distribution include paprika, star anise and chilli. However, as of February 5th, the Mintec price of Chinese star anise sold in the US market was unchanged w-o-w or m-o-m.

Well, well, well. Higher prices = short supply.....

And according to Olam Spices, in a letter to its customers:

Today, China produces about 70% of the world’s paprika in its Xinjiang region. From there, the product is delivered to Shandong province, where most of the paprika processors, exporters and speculative holders are located, to service the global demand of paprika for the rest of the year. The country also grows 75% of the paprika that is processed in Europe — especially in Spain.

At this point, we expect that the following factors could possibly create supply chain disruptions from China:

  • Growers shifting from traditional paprika to a hotter hybrid variety
  • Delayed and limited availability of high-quality paprika
  • 2019 year-end holidays in the destination markets
  • Early start and mandatory government extension of the Chinese New Year holiday
  • The shutdown of processing facilities due to the coronavirus (2019-nCoV)

Even after the facilities open in China, it is expected that labor availability will be limited due to travel restrictions. Shipping from Chinese ports is also likely to start gradually, as many shipping lines have reduced the vessels coming out of China. The stock in destination markets is limited due to these reasons and we could possibly see shortages build in the short term. In addition, we do not anticipate sufficient quantities coming into the market from any major origin until Fall of 2020.

What we are seeing here is not just the problems of COVID, but quite likely, the problems of communism. COVID of course has hyper-empowered the state. but in a centrally planned economy, it's enabled bureaucrats to make all the decisions - which road you can take, which days you can work, which ports and shipping companies can work. The fingerprints are out there. This has the look of the signature shortages of socialism, in that the free market can't work to find a work-around to all the problems, because the state power is just too strong and with too little information makes all the calls.

And sure enough, China is now experiencing a food shortage, with authorities there demanding Chinese have "clean plate" program. The news accounts say it's centered on the Yangtze river region in central China where rice is grown, but it's quite possible that with supply chains, it has a knock on effect in northwest China's Xinjiang region. The rivers could have a marginal connection too, based on the maps.

But there's probably another reason, and this goes to President Trump and his concerns: Why does China have the global market for paprika cornered?

Theres's some kind of monopoly going on, not a free market, and the little guys have been chased out, likely unable to compete on price. Because after all, if you run a slave state, you don't pay much for the help.

That's chased thousands of little guys out of the market, little guys who should have their cut of it.

Where's the place where paprika should be grown? Not China. Paprika, according to Wikipedia, while popular and delicious in Hungarian and Spanish cuisine, is actually a Mexican and Central American product. The Mexicans and Guatemalans and Salvadorans should have the lion's share of this market, with all that nice volcanic soil, and the fact that the plants evolved in their region, probably tastes better, too. 

By some dynamic, China has priced them out, and chased them out. Yet their product is better. And lots of people in those part look to the U.S. for a better life instead of the gifts nature bestowed on their own.

It underlines that Trump is right about the vulnerability of global supply chains dominated by China, and the importance of diversifying the supply. It's time to free the global paprika supply from China's grip, and restore it the countries where it rightfully is theirs to contribute to and profit from  world markets. 

Image credit: Shareable Meme Generator meme