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Citrusvil seeks to consolidate traditional and emerging markets

Citrusvil seeks to consolidate traditional and emerging markets
© Citrusvil 
PRESS RELEASE

 

Argentina exported around 242,000 tons of fresh lemon in 2020, a slight increase compared to 2019, although far from what was initially projected. According to Francisco Rotella, Citrusvil Fresh Fruit’s commercial manager, the season went through several stages, many of which were heavily affected by Covid-19.

The pandemic prompted consumers to turn to citrus fruits, including lemons for its high content of Vitamin C and its capacity to strengthen the immune system. The measures adopted to prevent the spread of the virus seriously impacted the crucial food service channel, especially in Europe and the United States. Moreover, Argentina decided to suspend lemon exports to Europe on July 1, 2020. This erratic scenario was reflected in the great price fluctuations, especially in Europe.

“At Citrusvil, we achieved exports of close to 27,000 tons. The 5,000 tons shipped to the United States market complied with the estimates made at the beginning of the campaign,” said Rotella. “This market is a destination on which Citrusvil will continue to focus in the coming seasons.”

Looking ahead to the next campaign, the company’s goal is to consolidate not only in traditional markets but also in so-called emerging markets, such as India and China, where Citrusvil is already working on commercial development. It will also seek to continue increasing its participation in other markets such as the Middle and Far East.

Positive balance of the pandemic

COVID-19 forced the Citrusvil organisation to adopt new protocols in its production processes in order to continue operating and guarantee the supply chain. To minimise the impacts, training of operational personnel was essential to ensure total adherence to prevention measures and protocols and the continuity of activity. This was achieved with a strong message to staff about the need to get the industry moving.

“This crisis has certainly generated a positive change in the culture of our company, where we have managed to adapt to the context, incorporating new health and safety protocols that have meant a great contribution to the industry in terms of food safety,” said Rotella. “All this will allow us to plan for the future and be prepared to overcome new risk situations as a reliable and sustainable supplier.

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Citrusvil’s campaign progresses at a steady pace

Citrusvil’s campaign progresses at a steady pace

Rapid action against COVID-19 allowed the company to quickly adapt to continue operating within the restrictions implemented.

The spread of the Coronavirus reached Argentina at a key moment for local citrus farming. Just as Citrusvil was preparing to start the 2020 campaign, the company found itself facing an unexpected situation, which led it to rethink its actions and adapt its facilities to keep production processes active and redouble efforts to keep collaborators safe.

Citrusvil started the season with the objective of exporting 40,000 tons of fresh fruit. Considering that this year, its farms are offering a better quality of lemons thanks to continuous improvement in management, added to the good weather, the company can continue providing customers with the products they require and fulfil all commercial commitments.

The first shipments were mainly destined for the markets of Russia, Ukraine, Mexico, Canada, the Far and Middle East. Around the middle of April, the firm started shipping to Europe and the United States, where the aim is to triple export volume from last year. At the moment, Citrusvil has exported around 14,000 tons to all destinations, which represents a significant step towards achieving its goals.

“However, we are aware that the season is complex and uncertain, since we must consider different variables that come into play based on the pandemic, in addition to internal and external competition,” said Francisco Rotella, Citrusvil’s fresh fruit commercial manager.

On the one hand, although there has been an increase in demand for lemon, due to the importance of Vitamin C for strengthening the immune system and the need for the population to stay as healthy as possible, there was also a sharp contraction in consumption in the food service channel, a critical sector for the food industry, which represents 40% of consumption in Europe, and 60% in the US.

On the other hand, South Africa has entered the fray, and aims to export a volume of 400,000 tons of lemons this year, compared to the 300,000 tons that Argentina seeks to reach. Finally, although Spain will have a lower production, it continues to play an active part in the European market.

“Taking into account the volumes already shipped by the Southern Hemisphere (Argentina and South Africa), and considering the potential of these origins, it is not clear how consumption will be affected by post-COVID-19 tourism activity, especially in Europe, which is a key market for us, accounting for 60% of lemon shipments ,” said Rotella.

Regarding industrial production, Citrusvil started the season with a goal of processing 250,000 tons of fruit. The strict protocols established by the company in order to ensure the continuity of its operations allowed it to start the season in a timely manner, and progress correctly with production, to the point that to date it has processed 90,000 tons.

“This volume is above what was initially projected, which gives us to understand that, despite the limitations generated by the pandemic, the company is moving firmly and positively towards the proposed objective,” said Alex Nolte, commercial manager of Citrusvil.

Although a 10% decrease in lemon production at the national level was initially expected, as the season has progressed, it appears that the reduction will be even greater than initially forecast. However, the drop in production in Spain suggests that there is the possibility of sending more juice to different markets.

Unlike fresh fruit, juices have not had the same impact on sales growth, despite also containing vitamin C. Still, it should be noted that for Citrusvil, the market for this product is recovering, and that sales of peel and oils are developing at a good rate.

“There are many diverse external factors that interfere with our operations today, which is why we must try to anticipate the inconveniences in order to minimise the impact that they could have on our organisation,” said Nolte.

Global uncertainty is generating unpredictable buyer behaviour, which makes long-term planning difficult and challenges the company to rethink its strategies and be more creative on a day-to-day basis.

Meanwhile, Citrusvil continues to work to ensure the responsible sourcing of its supply chains. The firm is always focused on research and innovation to improve its product portfolio and develop new solutions that meet the specific needs of customers. At the same time, it takes care of the health and integrity of its collaborators, suppliers and consumers.

 

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Citrusvil, significant investments to streamline all processes

CIT-argentina-CITRUSVIL-(3)

Among the strategies to deal with this bumpy year, Citrusvil is proposing to carry out a series of manoeuvres, both in-house and externally. First, internally, they will be working harder and better on the issue of lemon quality, incorporating cutting-edge technology to boost performance and cut production costs. An example of this is the significant increase in mechanical harvesting, especially for industrial lemon, as its handling will soon be totally automatic.  In the case of fresh lemon, although the contribution from growers is indispensable, Citrusvil’s aim is to triple workforce productivity by means of enabling machines. Producing sustainably and in harmony with the environment is a priority for the Tucumán leader, and to this end they are pioneering the use of a closed water saving and recycling system.  Along with this, Citrusvil is renewing its commitment to meet the All Lemon requirements to deliver a fresh lemon of the highest quality. Also, in the broader scope, the firm will continue to support government negotiations towards opening up the market in the United States, Japan and China.  Citrusvil accounts for 30 % of Argentina’s supply, which makes it one of the country’s top citrus companies. Production operations in the Tucumán region cover a net average of 6,000 ha in lemon production, the vast majority located in the Tucumán foothills, generating almost a million tons annually. Whereas last year they allocated 40 thousand tons of fresh lemon and 310 thousand t for industry, in 2014 they are also feeling the negative effects of the frosts, shipping only 24 thousand t of fresh lemon and 160 thousand t to the industry, i.e. in both cases they will have almost half as much fruit as last year. “This is a critical year – we haven’t seen anything like it in Argentina since 1989. The final balance will not be good even if there is a steep rise in prices, because the level of scarcity makes it impossible to compensate the loss. The groves will be producing half the amount, but still under the same fixed production costs.” explains the CEO Pablo Lucci, with concern. He also stated that it will be a time to strengthen relationships and try to supply all customers, even if it has to be in smaller quantities, but with the same quality and regularity as always.