>> A tasty place to park your money in China, the garlic market. Investors see the bulbs as a better bet than shaky stocks or property, many of them doubling their money year on year. As Reuters Jess Yu reports, the money making principles are the same in the fields and warehouses as they are on the stock exchange.
>> The way the speculation works is pretty simple. In Jinxiang, which is the unofficial capital of garlic in China, a lot of investors descend onto the town each year. They buy and horde as much garlic as possible, stuff it into these warehouses, some as big as soccer fields, and then in the fall, during the harvest season, when supply is tight, prices are high, they slowly release it into the market and make huge profits.
>> Many have already made a killing off manipulating garlic prices for years, creating a boom known as the garlic economy. This year might be different, though. Garlic agents tell Reuters that more and more new money is pouring in from speculators, driving up the cost per clove. And again, like the money markets, it's dog eat dog.
>> So the garlic market right now is creating a pretty big rift between winners and losers. The winners are very obviously the investors and the garlic agents, who are on the ground in main garlic production centers, who are making all the speculation. The losers are the farmers who are getting as little as four yen per kilogram, and the consumers in places like Beijing who are paying through the roof just for a few pieces of garlic.
>> Jinxiang makes 7% of China's garlic, and when prices spike here it gets felt around the world. There's barely any regulation of the market, making it hard to track and open to wild price swings. One thing's for sure in a market where a competition is growing this rapidly, there is no time for investors to be sleeping on the job