Ginseng Is a Dairyland Cash Cow : Agriculture: Wisconsin farmers milk it for all it’s worth. They’re trying to get Americans to fall for the herb used in Chinese medicine for generations.
Every year at this time, Wisconsin’s Marathon County becomes a Chinatown, as 40 to 50 Chinese merchants from Hong Kong, San Francisco, New York and Los Angeles converge on the quiet farming community to buy a prized herb the Chinese consider an aphrodisiac--ginseng.
Ginseng roots have been used for ages in Chinese medicine--chewed raw or brewed into tea--for illnesses and weaknesses. The Chinese believe that the bitter, man-shaped roots have a rejuvenating effect on the body.
But it is ginseng’s profit potential more than faith in its tonic powers that has spurred the growth of commercial production in Wisconsin. Processed roots wholesale for as much as $120 a pound.
Producers are also puzzling over how to entice Americans to consume more ginseng, nearly all of which is grown for sale abroad or in U.S. Chinatowns.
In its wild form, ginseng is native to the cool woods of the Midwest and southern Canada and to the upper Appalachian mountain range. It is an endangered species and cannot be taken legally until the plant has reproduced itself. Exports of wild ginseng bring in $15 million a year.
Although the cultivated variety is less prized, commercial production has shot up in Wisconsin, where the crop is worth $60 million to $70 million a year. There were fewer than 300 growers in the mid-1970s; today there are 1,700 statewide. And with 1,600 growers, Marathon County has the world’s largest concentration of cultivated ginseng.
Last year, Wisconsin growers produced 1.5 million pounds of the brown roots, about $50 million of which were exported to Hong Kong for both local consumption and re-export to other Asian countries. Chinatowns in the United States bought about $10 million.
“Demand has been very strong, but it’s not a sure-fire way of earning money,” said Jeff Schira, co-founder of the 400-member Wisconsin Ginseng Growers Assn. and the Ginseng Board of Wisconsin.
“Many farmers have gone bankrupt,” said Schira, a farmer for 17 years. “People don’t realize the tremendous cost in planting and moving it. You can run into severe diseases and lose everything. Ginseng has to freeze over the winter time, (and) it needs a cover of snow but not a lot of rain. A couple of years ago I got hit by a tornado and lost everything.”
Still, he added, “there are many part-time farmers who see it as their hope in life to get ahead. If their gardens die, they still have their jobs in town.”
Schira, who has a salaried job as a buyer for a Hong Kong ginseng auction house, owns a 120-acre farm, with six acres planted in ginseng. Most of the other farms are smaller--about three acres or less.
Just to get an acre planted requires an investment of about $25,000, and the roots cannot be harvested for four to five years, when the plant--green with red berries--reaches a height of 1 1/2 feet. The yield can be anything from zero to 2,000 pounds per acre, “depending on luck,” Schira said.
Last year, after the Tian An Men square massacre in China--the largest market for American ginseng--the export price of unprocessed ginseng roots fell by one-quarter to the high $20s per pound but rebounded later to the $30s. The price fell when the Hong Kong merchants who buy U.S. ginseng for re-export to China cut back their purchases because of the political tumult.
So far this year, there are no negative developments in the export market, and prices are in the high $30s to low $40s a pound.
But Wisconsin farmers fear that the growing popularity of their ginseng is being threatened.
Chinese ginseng has been flooding Hong Kong, eroding the market for American ginseng there and in U.S. Chinatowns, Schira said. He faulted the quality of the Chinese variety: “The root looks like ours. But ours is denser and has a much stronger smell.”
U.S. producers are also feeling competition from Canada, where ginseng production has exploded to about half a million pounds a year, the bulk of which is exported to Hong Kong.
To help the industry grow, the Ginseng Board of Wisconsin is trying to find new markets, both abroad--including Taiwan, Singapore and Japan--and at home.
Said Ron Rambadt, the board’s executive director: “Somewhere down the road, we hope to sell to the American market--that’s the goal.”
In the United States, by far the majority of ginseng users are Asians, who buy the root in Chinatown shops. Last year, Chinatown buyers were paying farmers from $40 to $120 a pound for processed U.S. ginseng, depending on the grade. Korean ginseng--the most established variety--wholesales for about the same price. Chinese ginseng is far cheaper.
Rambadt said producers hope to stimulate U.S. demand by generating scientific research that would back up their claims that ginseng helps lower cholesterol and reduce fatigue.
Some buyers need no such persuasion.
“American ginseng is for energy; you can chew it anytime,” said a 68-year-old Vietnamese Chinese woman living in Los Angeles who identified herself only as Mrs. Luu. She visited Chinatown recently to shop for her regular supply of ginseng, plus some for relatives in Vietnam. “I take Korean ginseng only in winter,” she said.
To cater to American consumers, U.S. manufacturers have followed the lead of their Korean competitors by offering the root in such forms as capsules, tea and health drinks.
Fmali Herb Co. of Santa Cruz has been using American ginseng in its capsules for 15 years. However, said sales manager Grace Marroquin: “American ginseng costs more, (so) we don’t use it in products unless it’s for a particular reason.”
R. J. Corr Naturals Inc., a Chicago-based maker of natural soft drinks, created a soda called “Ginseng Rush” in 1978. Chief executive Robert Corr, who believes that ginseng is a natural anti-stress remedy, said the company plans to come out with a nonalcoholic ginseng beer next January and maybe a ginseng elixir later.
But will most Americans pay for ginseng? Said Los Angeles lawyer Carl Shusterman: “Depends on what it’s going to do for my health. They (manufacturers) have to give me some product claims.”
