Photo: Eurofresh Distribution
Japan’s citrus crop is expected to recover in 2020/21 following a poor harvest in 2019/20, according to FAS/Tokyo data. Increased household consumption of oranges due to the COVID-19 pandemic is predicted to provide a modest boost to imports of fresh oranges. Following a COVID-19-related decline in food service demand in 2019/20 and resulting high levels of stocks, 2020/21 imports of lemons and orange juice are projected to plummet. Grapefruit demand continues to steadily slip.
In 2019/20, Japan increased imports of fresh tangerines by 11.3% to 21,031 tons, due to lower domestic production. This increase was primarily reflected in the summer tangerine imports from Australia, the second largest tangerine exporter to Japan. The US is the top exporter of fresh tangerines to Japan and supplies approximately 60% of Japan’s tangerine imports. A recovery of domestic summer fruit production is forecast in 2020/21, which should prompt a contraction in import volumes. Japan’s 2020/21 tangerine imports are expected to fall 9.6% to 19,000 tons, of which 12,000 tons will be from the US.
Photo: Aksun Company, Turkey
Turkey’s 2020/21 citrus crop is projected to fall from the levels of the previous year due to high temperatures in May 2020 during the blooming season, according to USDA data. While prices received by producers have not increased significantly, production costs such as fuel, fertilisers, labour have risen rapidly due to the weak currency and high inflation. Citrus exports in 2020/21 are expected to be down due to logistical problems with neighbouring countries and Saudi Arabian sanctions on Turkish products. Tangerines account for 34% of total citrus exports, followed by oranges (25%), lemons (24%) and grapefruit (17%). In 2019/20, the Russian market received 28% of Turkey’s citrus exports due to geographic proximity, strong logistical infrastructure, and high demand. Turkish citrus exports to the EU were up in 2019/20, but there was a shortage of immigrant labourers from North Africa as a result of the Covid-19 pandemic.
Photo: Israel citrus by depositphotos®
Israel’s citrus production continues to expand, increasing 3.7% in 2020/21 to 18,260 ha, according to FAS/Tel Aviv data. Israel’s citrus exports in 2020/21 are forecast to fall 1% to 157,000 tons (not including niche varieties) due to harsh climatic conditions early this season that led to lower yields. Despite high international demand for citrus, growers may not be able to meet this. Total citrus exports in 2019/20 were also low at 159,000 tons, due to the lack of shipping options during the pandemic.
Israel is seeking new export markets for grapefruit in Asia, where there is less competition and favourable prices. These markets give a higher dollar value for the product compared to closer markets such as Europe where Israeli produce faces stiff competition from other exporting countries such as Morocco and Spain. Two varieties account for 79% of Israel’s citrus exports: red grapefruit (38,000 tons) and the Or mandarin variety (87,000 tons).
Peru has authorised imports of Spanish citrus and persimmon, providing a welcome boost for Spanish producers. Peru’s Ministry of Agrarian Development and Irrigation (Midagri) authorised imports of fresh mandarins, oranges and persimmon that have been subjected to cold treatment. Spain’s Agriculture Ministry said the move opens the door for exports of other products to Peru and other regional markets. Midagri said exports will be able to start once cold treatment processes have been verified.
Photo: citrus of Mexico, exporter of the chinese market
China’s fresh citrus production and consumption are forecast to continue their upward trends in 2020/21, reaching 35.6 million tons and 34 million tons, respectively, according to FAS/Beijing data. However, the rate of production growth is expected to slow as prices drop and consumer demand reaches saturation point. Demand for imported citrus in 2020/21 is expected to remain low due to the economic downturn, down 25% overall from pre-COVID levels. There are also lower imports of frozen concentrate orange juice and production, indicating consumers’ changing preferences to juices made from fresh fruits. Chinese countermeasures for COVID-19 will continue to add complications and costs to all cold chain imports, including citrus.
Fresh orange imports are projected to grow slightly in 2020/21 to 290,000 tons, as the Chinese economy partially rebounds while local citrus supplies will depress import demand. Major suppliers remain Egypt, South Africa, Australia, the US, and Spain. China’s total imports of fresh oranges dropped dramatically in 2019/20, due to the sudden increase in freight costs and labour impacts of COVID-19. Before the pandemic, China’s orange imports had witnessed seven consecutive years of growth. Imports from all sources fell Egypt (-41%), South Africa (-15%), Australia (-37%), and Spain (-80%).
Meanwhile, China’s orange exports are expected to increase 5% y-o-y to 55,000 tons, thanks to restored logistics, the increased crop size, and rebounding economies. 2019/20 exports totalled 52,000 tons, with Vietnam accounting for 60% of the volume. Other export destinations for fresh Chinese oranges are the Philippines, Malaysia, Russia, Hong Kong, and Thailand.
Photo: Citrusvil Argentina
Argentina’s citrus sector is undergoing difficult times due to a drought that has reduced fruit size. Fresh lemon production for 2020/21 is projected to plummet by 30% to 1.03 million tons, according to FAS/Buenos Aires data. Lemons were particularly affected by low temperatures early in the growing season. The drought will limit orange and tangerine production increases to 700,000 tons and 360,000, which nevertheless represent 50,000 ton increases for both fruits compared to 2019/20.
Lemon exports in 2020/21 are projected to fall 23% to 190,000 tons, due to the smaller crop, larger Northern Hemisphere supply, strong competition from South Africa, and uncertainty regarding the EU measures to tackle Citrus Black Spot. Sweet citrus exports are estimated at 80,000 tons for oranges and 35,000 tons for tangerines, which are both significantly lower than historical levels. The country’s citrus sector is dealing with challenging domestic economic conditions, which have reduced Argentina’s ability to compete in export markets against other Southern Hemisphere exporters, especially South Africa.
Photo: Cítricos Rosegar
EU citrus production in 2020/21 is predicted to rise 7.5% to 11.4 million tons, due to favourable weather conditions, according to FAS/Europe. The 2019/20 EU citrus season saw an increase in citrus consumption and peak citrus prices. The recovery of EU production and higher global demand for citrus related to the COVID-19 pandemic may dampen EU imports. Strategic export markets destinations for EU citrus continue to be Canada, the Middle East, and China, followed by Switzerland, Norway, and Serbia. Additional tariffs are expected to continue impacting citrus trade with the US.
EU orange production is forecast 5.6% higher than the previous season at 6.5 million tons. Orange juice production in the EU is predicted to rise 8% to 87,987 tons. EU mandarin production is forecast to be up 10% to 3.1 million tons. Over the last decade, the EU’s total orange planted area has shrunk almost 12% and mandarin growing area by 10%. During this same period, EU lemon and grapefruit planted area grew by 9% and 6% respectively mainly due to the growth in Spain in response to global market demand.
In 2019/20, as a result of the decline in EU citrus production, EU imports of citrus grew slightly, mainly from South Africa, Egypt, and Morocco. EU citrus export destinations are mainly Switzerland, Norway, Canada, and Serbia, with significant rises in new third markets such as China and the Middle East. EU citrus exports are expected to continue to rise.
South Africa’s orange exports are forecast to be up by 2% to 1.32 million tons in the 2020/21 MY, from 1.29 million tons in the 2019/20 MY, according to USDA data. The increase is attributed to a combination of a larger production area and the continued impact of COVID-19. The EU remains South Africa’s largest export market for oranges, accounting for 38% of the total. However, exports to Asia and the Middle East have grown steadily over the years due to the industry’s focus on growing these markets. Exports to the US are expected to continue based on the duty free access under the African Growth and Opportunity Act (AGOA). However, a gradual shift from oranges to soft citrus exports is expected over time, as South African farmers supplying the US market have been re-planting their orchards from oranges to soft citrus in response to market preferences and the higher premium received in the US market. Exports to the United States decreased in 2019, due to the shift from oranges to soft citrus and small fruit sizes.
South Africa’s grapefruit exports are expected to increase by 2% to 260,000 tons in the 2020/21 MY, due to a rise in production and continued demand for citrus in global markets for health reasons. Europe is the largest market for South African grapefruit exports, accounting for 48% of the total in 2019, followed by Asia (35%). The main European destination is the Netherlands, while China and Japan are the major Asia destinations. Although South Africa has a free trade agreement with the European Union, which allows duty-free access for its citrus exports, South Africa continues to face challenges due to Citrus Black Spot (CBS) and False Coddling Moth (FCM) in the EU market. Industry estimates that it is costing South Africa almost US$118 Million to address the problem and comply with CBS requirements in the EU market.
Heavy November rains along Valencia’s coastal regions caused more than €62 million in losses, including crop damage, the extra treatments to save trees and repairs to damaged infrastructure, according to a preliminary assessment by the Valencian Association of Agricultural Producers (AVA-ASAJA).
In La Ribera, losses amount to €42 million. Citrus is the most affected crop, with some 15,000 hectares affected and 20 million fruits that will not reach the markets. As for kakis, whose harvesting season is underway, there are 4,000 hectares seriously damaged and losses amount to around €12 million. Moreover, 1,000 hectares devoted to seasonal vegetables, both in the open ground and in greenhouses, have been destroyed with an economic impact of €6 million. Lastly, the nurseries of ornamental plants and flowers, which have had 100 hectares hit by the storm, estimate their losses at €4 million, and this follows the impact of COVID-19 on the market.
AVA-ASAJA also estimates that €5 million will have to be spent by producers on fungicide and revitalising treatments in order to salvage the next season and even the life of the trees. The agrarian organization warns that if citrus and kaki fields remain flooded for several days, there may be irreversible damage caused by root asphyxia.
As far as agricultural infrastructures are concerned, AVA-ASAJA estimates the extra costs needed to repair roads, pipelines, greenhouses, warehouses or irrigation facilities at €15 million. In total, AVA-ASAJA believes that €62 million will be needed.