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China’s investors, sick of ailing returns, see traditional Chinese medicine as a cure

  • Common ingredients used in TCM have seen their prices surge in recent years as users stockpile supplies and available farmland grows scarce

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A pharmacist sorts granules of traditional Chinese medicine (TCM) at the Gansu Provincial Hospital of TCM in Lanzhou, Gansu province. Photo: Xinhua
Mandy Zuoin Shanghai

Frustrated by a battered stock market and a housing bubble that has gone from boom to bust, some Chinese investors are looking to root their money in a more traditional sector: medicinal herbs.

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Niche plant products for therapeutic purposes have become an increasingly popular alternative for those seeking lucrative investment opportunities amid the oriental nation’s push to promote traditional Chinese medicine (TCM) – an ancient system of health and wellness dating back 2,000 years.
Prices of some particular ingredients have seen multifold rises in recent years thanks to hot money speculation, a decrease in arable land, and extreme weather, according to industry insiders and observers.

The Kangmei TCM material price index, a barometer of the country’s medicinal herb market since receiving government approval in 2012, has reflected substantial gains since the summer of 2020, climbing by nearly 75 per cent in the past four years.

The index for Atractylodes macrocephala, a flowering plant whose roots are used to treat digestive problems, grew threefold over that same period. And for coltsfoot, whose flowers are a common remedy for respiratory conditions, it surged even more.

Coltsfoot flowers, which are sometimes confused with dandelions, are seen alongside honey. Photo: Shutterstock
Coltsfoot flowers, which are sometimes confused with dandelions, are seen alongside honey. Photo: Shutterstock

Guo Tingli, a medicinal herb retailer in Bozhou, Anhui province, where China’s largest trading market of TCM materials is located, said the price for 1kg (2.2 pounds) of coltsfoot was about 100 yuan (US$14) two years ago, but now it runs around 400 yuan.

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