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Dried berries driving growth in US cranberry exports

America’s cranberry farmers are in the homestretch of the harvest in what looks to be another banner year for US cranberry production, reports the USDA Foreign Agricultural Service.

America’s cranberry farmers are in the homestretch of the harvest in what looks to be another banner year for US cranberry production, reports the USDA Foreign Agricultural Service.

A bountiful crop of 8.59 million barrels or 390,000 tons is forecast for 2016 and just over a third of it will be exported to long-established markets in Europe and Canada, and also newer markets in Mexico, South Korea and China, it said in the report Cranberries: No Longer Just an American Tradition.

But it is dried rather than fresh cranberries that are driving growth in US cranberry exports.

“Demand growth for cranberries is tied to the popularization of sweetened, dried cranberries with strongest demand growth from markets with increasing populations and per capita income,” the report says.

EU tariff concerns

Cranberries are native to North America. The US is the world’s top cranberry producer and top supplier of cranberries to the EU, which is its biggest market for this product.

Processed cranberry exports surged in 2011 when the EU waived a 17.6% import duty on dried cranberries.

“The duty suspension for processed cranberries is up for review by the EU in 2017, but the trading landscape has changed. On October 30, 2016, Canada and the EU signed the Comprehensive Economic and Trade Agreement (CETA), which will eliminate and reduce tariffs between the EU and Canada. Canada is the second largest producer and exporter of cranberries, and through CETA, Canada has secured permanent duty-free access for processed cranberry exports to the EU.

“Also, Chile—the third largest producer of cranberries globally— signed a trade agreement with the EU and has had permanent duty free access since 2012.”

However, the US does not have such a free trade agreement in place with Europe.

“If the EU does not renew the duty suspension on US cranberries, US producers and exporters will have a more difficult time competing with Canada and Chile to service the largest market for processed cranberries,” the report says.
 

Source: Cranberries: No Longer Just an American Tradition, November 22, 2016 International Agricultural Trade Reports
Cranberry harvest image: USDA Agricultural Research Service

 

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Taiwan’s apple imports to decline slightly, says USDA

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Taiwan’s apple imports for the 2016/17 marketing year are forecast to total 160,000 tons, down 5% on last year’s record 169,000 tons, reports the USDA.

“A decline in price competitiveness of imported apples, compared with other imported fruit, and weak economic growth, are reasons for the lower import estimate,” it says.

Furthermore, a “strong harvest in the state of Washington will help the United States to remain Taiwan’s leading apple supplier according to industry sources.”

Taiwan’s domestic apple production continues to decline and currently meets less than 1% of domestic demand.

Apples are Taiwan’s leading imported fruit, and the US is the leading supplier with about 31%  of the import market share.

Fuji remains the most popular variety accounting for nearly 90 percent of imports.

source: Taiwan’s Apple Imports Forecast to Decline Slightly

 

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Key role for greengrocers in Bulgaria’s retail market

Bulgaria’s retail market is seeing an emerging wave of small specialised stores for fruit and vegetables.

Bulgaria’s retail market is seeing an emerging wave of small specialised stores for fruit and vegetables.

Along with those for dairy and meat products, these stores focus on consumer convenience and the need for fresh, local, and organic food of high quality – something which so far has not been the strongpoint of the country’s modern retailers.

A USDA Gain report also says fresh produce grocery retailers seem to be the only category which was not heavily harmed by the economic crisis, thanks to the fact groceries are a necessity which can’t be cut from the family budget.

The report notes that the outlook in Bulgaria is for traditional retail to underperform compared to modern trade as large retailers plan to move towards densely populated town centers by opening convenient stores and smaller supermarkets. But it says one exception will be the small specialised stores for fruit, vegetables, and dairy and meat products, which focus on convenience and fresh produce.

Meanwhile, hypermarkets and discounters are forecast to keep growing fast in Bulgaria in 2016/17, with Kaufland and Lidl expected to hold leading positions and increase their market shares this year. Convenience stores are expected to be the third fastest growing channel for grocery retailers.

The retail sector’s leader is the German discounter Kaufland, which in 2015 held a market share estimated at 13.2%, followed by Metro with 7.1%, Lidl with 6.3%, and Billa with 5.5%. The only local player among the lead retailers is Fantastico, which currently operates 38 outlets situated only in the capital city Sofia.

A new player, the largest Macedonian food retail chain KAM, recently announced an ambitious plan to enter the Bulgarian market by opening 20-25 outlets by the end of 2016 and as many as 80 outlets by 2018. It will apply a ‘hard discount’ model. KAM’s current outlets import from Greece, Turkey, Germany, Italy, and other European countries. “KAM self-defines as the Macedonian version of Aldi and also aims to take as much of the share freed up after Penny’s withdrawal,” the report says.

Price consciousness dominates

Bulgarian consumers are known as traditionally price sensitive. The report says this is not surprising given Bulgaria is the EU country with the lowest GDP/capita. In recent years, retailers have thus striven to lower prices while maintaining quality in order to increase sales.

Consumer price consciousness is expected to dominate in the next few years due to projections for no significant improvement in job creation in medium term as well as negative predictions about the demographic situation and expectations for up to 3% decline of population, the report says. (The country’s population last year was around 7.2 million, according to tradingeconomics.com.)

Value of Bulgaria’s retail market

The report says Bulgaria has been on the path to recovery since 2014 and reached annual growth of 3% in 2015. In 2015 GDP was U.S. $51 billion with a GDP per capita of $6,960. Real GDP growth is forecast to slightly decelerate to 2.1% in 2016 before picking up to 2.5% in 2017.

According to Euromonitor data and local sources, in 2015 the retail market was estimated at nearly 10 billion leva (U.S. $5.7 billion).

At the time of the Gain report’s preparation, the number of modern grocery outlets in Bulgaria stood at 4,225, which accounted for just over a tenth of all grocery retail outlets.

Last year, the sales in modern grocery retail reached almost BGN 5.4 billion (U.S. $3.05 billion) and held a combined market share of 55%, which is likely to slightly increase to 56% in 2016, and 57% in 2017.

The remaining 45% or almost BGN 4.4 billion (U.S. $2.5 billion) was held by almost 35,900 traditional grocery outlets throughout the country.
 

Source: GAIN Report Number: BU1624, dated 7/14/2016, Bulgaria Retail Market Update
Main image: The Bulgarian city of Plovdiv, by Klearchos Kapoutsis from Santorini, Greece (Plovdiv) [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons

 

 

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The EU’s fresh lemon imports rose 5% last year

While EU lemon trade with Russia suffered an important decline due to the Russian ban, recently, EU-28 citrus exports to new strategic markets such as North America and Asia are increasing to compensate the loss of the Russian market.

Lemon and lime imports into the EU – a net importer of lemons – reached 399,040 tons in the 2014/15 marketing year (November-October), a 5% rise on the previous year.

Argentina is by far the main source of these imports, alone accounting for a third of the total volume, says the USDA Gain report ‘EU-28 Citrus Semi-annual’.

After Argentina, the top suppliers to the European market are Turkey, Brazil, Mexico and South Africa.

However, the report highlights that intra-EU trade is critical to the sector, taking into account the volume of lemons produced in the Mediterranean EU states and the demand in EU States which are not lemon producers.

EU lemon exports

The EU exported 105,617 tons of fresh lemons and limes in 2014/15 – 5% more than the year before – with Switzerland (18%) and Belarus (16.5%) the main extra-EU destinations.

During the same marketing year, EU lemon exports to Russia suffered an important decline – 92% – due to the Russian ban. However, EU citrus exports to new strategic markets, such as North America, North Africa and Asia, have been increasing significantly recently, helping offset the loss of the Russian market.

The EU’s main lemon producer, Spain, exported 673,921 tons in 2014/15, of which 90% went to other EU countries.

Fresh lemon production in the EU

Figures for EU fresh lemon production have been revised down 1.9% from previous estimations and the EU lemon crop is now expected to reach 1.26 million tons in 2015/16, down 21% on the previous year due to a drop in Spanish lemon production.

The decline in Spain’s lemon production follows unfavorable weather in spring 2015, namely warm temperatures and lack of rain which affected the flowering and fruit set. Spain’s lemon crop is therefore expected to come in at about 744,800 tons, down 31.6% on the previous year but returning to more normal production parameters and with good quality. There will be a big reduction in the volume of lemons available for Spain’s processing industry.

Little change on last year is expected for the volume from the EU’s number two fresh lemon producer, Italy, whose crop is expected to total about 430,000 tons, but with better quality. “Moreover, no insect problems and the abundant rainfall made the lemons even juicier,” the report says.

The 2015/16 lemon production of the EU’s 3rd biggest grower, Greece, is expected to be up 7.7% on the previous year, while that of Portugal, which comes next, is projected at the same level as last year, with normal calibers and quality.

Most common lemon varieties in the EU

Fino is the dominant lemon variety in Spain, representing 70% of total production and favoured by processors. Verna, a tender and juicy variety with few seeds, currently represents the remaining 30% but because it offers higher profitability and less competition with Turkey, there is interest in replacing Fino with Verna so that the latter, at least in the short term, accounts for 40% of total production.

Femminello Commune (F. Zagara Bianca, F.Siracusano, F. S.Teresa), Monachello, and Interdonato are the main lemon varieties grown in Italy, while in Greece the main lemon variety is Maglini, which produces strongly aromatic fruit, with a quite sour juice, but the early variety Interdonato, and the varieties Verna and Eureka are also grown there.

Source: USDA Gain report SP1611 ‘EU-28 Citrus Semi-annual’, 6/15/2016
Lemon image: By André Karwath aka Aka – Own work, CC BY-SA 2.5, https://commons.wikimedia.org/w/index.php?curid=59992

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French pesticide ban could aid US cherry exporters in other EU markets

While US cherry exports to France will be prohibited this year, due to the Dimethoate ban, on the positive side for US cherry exporters is that France’s production is likely to be impacted by the ban on the pesticide – the French cherry crop is likely to be smaller and pricier – thus creating opportunities for France’s competitors in the EU, such as the UK.

France’s ban on cherry imports from countries where the pesticide Dimethoate is used has left fruit importers and traders fearing the country may soon apply similar bans involving other EU-approved pesticides or chemicals, according to a report by the USDA Foreign Agricultural Service (FAS).

Should their fears come true, this would be akin to a “de-facto shutting down the free movement of EU and third-country fruits and vegetables into France,” the report says.

While US cherry exports to France will be prohibited this year, due to the Dimethoate ban, on the positive side for US cherry exporters is that France’s production is likely to be impacted by the ban on the pesticide – the French cherry crop is likely to be smaller and pricier – thus creating opportunities for France’s competitors in the EU, such as the UK, the report says.

“On April 22, 2016, France temporarily banned the import and sales of cherries imported from countries where the chemical product dimethoate can be used on cherries and cherry trees. It follows the ban of its use for domestic production. Dimethoate was used to fight Drosphila suzukii, an Asian fruit fly which causes considerable damages in cherry orchards but is suspected by France of being dangerous to human health.

“France imports roughly one fifth of its consumption, the bulk coming from EU countries including some (such as Spain, Italy and Spain) that have already banned dimethoate. The French prohibition will de facto suspend imports of cherries from the United States, valued at around $1 million annually.

On the other hand, as France’s production is likely to be impacted by the ban on the pesticide, French cherries are likely to be scarcer and more expensive, creating opportunities for competitors on traditional French export markets such as the UK.”

Overview of French cherry production and trade

France is a minor producer of cherries in the EU and its production has been declining steadily over the past few years. Most of its cherry production is concentrated in the country’s south and southwest. Its cherry exports go mostly to neighboring countries, such as Germany, Belgium and the UK.

A net importer of cherries, the bulk of France’s imports come from the EU (Spain, Belgium, and Germany) and Turkey. Chile is the main supplier of winter cherries.

The US has a niche market in France for late summer cherries (from mid- July to August) and French imports of US cherries (mainly from Oregon and Washington) are valued at about $ 1 million annually. It should also be noted that about half the cherries listed as imported from Netherlands are in fact US or Canadian cherries that cleared customs in that country.

Source: GAIN Report FR1606, 5/20/2016 “U.S. Cherries Exports to France hit by French Pesticide Ban”

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NZ’s deciduous fruit renaissance

New Zealand’s 2015/16 apple exports to reach 351,000t after 333,218t in 2014/15 with record prices.

New Zealand’s deciduous fruit exports should reach a total of 351,000 tons for 2015/16, up from 333,218 tons in 2014/2015, according to updated forecasts in a recent USDA Gain report.

Even though this season was meant to be a biennial bearing ‘off’ year, total deciduous fruit production for 2015/16 is now forecast at 561,100 tons, which would be just 0.7% under the 2014/15 volume of 564,800 tons, the report says. This is thanks to a superb growing season and new plantings of varieties less susceptible to biennial bearing.

Grower returns for the 2015 calendar year were up 15-20% on a per hectare basis, making three profitable years in a row and similar, “if not slightly better” returns are expected this year.

“The highlight of the CY2015 New Zealand export season was the very good FOB returns, which averaged NZ$33.96/TCE thirteen percent better than 2013/2014. A depreciation of New Zealand currency during the year was behind the increase. Most grower returns were bolstered by 15-20% per hectare from a combination of the better prices and on average five percent better average yields,” the report says.

Sector in expansion mode

Total deciduous fruit plantings are estimated at 9,626 ha, up 3.4% on the 2014/15 total of 9,309 ha. “Total plantings are forecast to keep increasing at the rate of 300-400ha per year through to CY2020.”

“…the sector is now in a renaissance and is forecast to expand the planted area each year through to 2020. By 2020 it is forecast the apple area will be 10,400 ha to 10,600 ha. The trends of the last 5-6 years will be continued in terms of cultivars planted with: high color Royal Gala sports; new Fuji varieties; Pacific Queen; and Envy plantings dominating.”

Top image courtesy of Pixabay

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Record number of US organic producers

Its new Organic Integrity Database will provide data for market research, enable stakeholders to identify market opportunities and make supply chain connections, support international verification of operator status to facilitate trade, and establish technology connections with certifiers to share more accurate and timely data, the USDA said.

The number of domestic certified organic operations in the United States rose almost 12% between 2014 and 2015.

This represents the highest growth rate since 2008 and an increase of nearly 300% since the count began in 2002, according to the U.S. Department of Agriculture (USDA) and based on data released by its Agricultural Marketing Service’s (AMS) National Organic Program (NOP).

The total retail market for organic products in the US is now valued at more than $39 billion and over $75 billion worldwide, the USDA said.

And according to new data, there are now 21,781 certified organic operations in the US and 31,160 around the world.

The significant increase in the number of certified organic operations continues the trend of double digit growth in the organic sector, the USDA said.

US Agriculture Secretary Tom Vilsack listed organic food as one of the fasting growing segments of American agriculture. “As consumer demand for organic products continues to grow, the USDA organic seal has become a leading global standard,” he said.

The USDA said it is helping make organic certification more “accessible, attainable, and affordable through a ‘Sound and Sensible’ approach…streamlining the certification process, focusing on enforcement and working with farmers and processors to correct small issues before they become larger ones.”

Resources help identify market opportunities

Among relevant USDA resources are the site www.usda.gov/organic, while the data referred to above is publicly available as part of the recently launched Organic Integrity Database, which tracks certified organic operations.

The database allows organic certifiers to add new operations and report changes to existing operations at any time, allowing USDA to report updated counts of certified organic operations throughout the year. “The modernized system will provide data for market research, enable stakeholders to identify market opportunities and make supply chain connections, support international verification of operator status to facilitate trade, and establish technology connections with certifiers to share more accurate and timely data,” the USDA said.

Additional information about USDA resources and support for the organic sector is available on the USDA Organics Resource page.

Consumers also like local food

Along with demand for organics, consumers are increasingly asking for local foods, the USDA said, saying it has “supported providing consumers a stronger connection to their food with more than $1 billion in investments to over 40,000 local and regional food businesses and infrastructure projects since between 2009. Industry data estimates that U.S. local food sales totaled at least $12 billion in 2014, up from $5 billion in 2008.”

Image of partial search results using the USDA’s Organic Integrity Database

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Imports capture under 10% of US fresh apple demand

Imports are a growing presence in the US fresh apple market but still small relative to domestic production, according to the publication ‘Fruit and Tree Nuts Outlook: Economic Insight US Fresh-Market Apples’.

Less than one in ten fresh apples eaten in the United States in the last five years was grown abroad, figures from a USDA report show.

That’s up from an average of one in twenty in the 1980s.

But while imports are a growing presence in the US fresh apple market, they are still small relative to domestic production, according to the publication ‘Fruit and Tree Nuts Outlook: Economic Insight US Fresh-Market Apples’.

It says the the US is a leading importer of fresh apples and the amount of globally sourced fresh apples in the US has risen significantly since the 1980s – from an average 237 million pounds in the 1980s to almost 400 million pounds over the last 5 years. “Record imports were reported in 2003/04 at 472.7 million pounds. Import share of domestic fresh apple use has risen from a 5% average in the 1980s to around 8% over the last 5 years.”

Chile the US’s main foreign source of fresh apples

With counter seasonal production, Chile accounts for over 60% of total import volume, making it by far the US’s top foreign source of fresh apples.

It has emerged as a strong supplier over the past decade having “successfully developed a more export-oriented apple industry and benefited from the growing demand in the Northern Hemisphere for off-season fruit.”

New Zealand, Canada and Argentina account for most of the rest of US fresh apple imports.

Imports continue to be concentrated over the US summer but the combination of new varieties with later harvest dates and the increased use of more sophisticated storage technology have enabled the US apple industry to move domestic apples more evenly across the marketing season. “Even in summer months when import volumes are increased, domestic production dominates fresh apples shipped throughout the year.”

“The marketing season for US apples runs from August through July. Harvesting occurs between August and November, but the ability to store apples for a long period and counterseasonal import availability permit more even distribution of supplies throughout the year, which mitigates seasonal price variability.”

US apple exports

Five countries – Mexico, Canada, India, Taiwan, and the United Arab Emirates – account for more than half of US apple exports, with Mexico alone taking more than a quarter.

More than 60% of the total export volume for the marketing year is shipped between October and the following March, partly coinciding with the fall harvest.

High hopes for more exports to China

The report says a bright spot in US apple exports is the prospect of future sales increases to China.

“The 2015/16 season will be the first full marketing year with expanded market to China and already, export volume this season through January is 98% higher than the same time in 2014/15. The US apple industry estimates that within two years, exports to China will reach a value of nearly $100 million per year.”

source: Fruit and Tree Nuts Outlook: Economic Insight US Fresh-Market Apples

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NZ kiwi exports set to soar from 2017

In the next 4-5 years, NZ kiwi export volumes are poised to jump up about 20% to reach levels up to 550,000 tons per annum.

Last year was a bumper one for the New Zealand kiwifruit industry with production up 30% to 475,000 tons, exports up 31% to 454,000 tons, and FOB export receipts up 43% to NZ $1.44 billion yoy, reports the USDA.

This year is forecast to be one of consolidation with production and exports up just 1.5% to 482,400 and 460,400 tons respectively.

But over the next 4-5 years, export volumes are likely to resume a faster growth rate, expanding by an estimated additional 20% to reach levels of around 540,000 to 550,000 tons per annum, according to the USDA’s Kiwifruit Sector Report for 2016.

Rise of the Gold kiwifruit variety “G3”

The impressive 31% increase in exports last year over exports in 2014 “is testament to how quickly growers have been able to get the new Gold G3 variety up to mature yields and the superb growing season in 2014/15, which maximised yields in the orchards,” the report says.

And while this year little growth is expected in overall kiwi exports, the variety mix exported will change considerably with Gold kiwifruit volumes up by an estimated 30% and comprising 36% of the total volume of kiwifruit exported from New Zealand.

Export markets

Zespri Gold sells at a premium to virtually all other kiwifruit. The northern E.U. takes the biggest volume of NZ kiwi exports but at a significantly lower FOB price per ton (44% less) than Japan. This is not just due to higher prices for all kiwifruit in Japan, but reflects that Gold kiwifruit comprise 36% of all kiwifruit sold in Japan and just 17% in Northern E.U.

The report says a core strategy for Zespri in order to maintain current price/demand relationships in its more mature markets, amid the increased supply expected in the next four years, is to invest strongly in developing markets. For Zespri these are: China, Latin America (especially Brazil), Turkey, the Middle-East, Mexico and South Korea.

Read Gain report NZ1601, March 24, 2016, “Kiwifruit Sector Report – 2016”

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Meeting fruit & veg rations can cost just $2.10 a day

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Buying 2 cups of fruit and 2.5 cups of vegetables can be obtained for $2.10 to $2.60, analysis of grocery store prices by the USDA’s Economic Research Service (ERS) reveals.

The 2015-2020 Dietary Guidelines for Americans advises that people needing 2,000 calories per day include 2 cups of fruit and 2.5 cups of vegetables in their daily diets. But according to ERS research, the average American adult consumes only 1.1 cups of fruit and 1.6 cups of vegetables per day. 

The ERS recently analysed average 2013 grocery store prices and found that meeting the recommendations can be achieved for $2.10 to $2.60.

However, fruit and vegetable costs vary widely. “When expressed in cup equivalents, nine fruits (three fresh and six processed) cost less than $0.40 per cup equivalent. Watermelon ($0.21) and frozen concentrated apple juice ($0.27) were the least expensive. Twenty-six fruits (12 fresh and 14 processed) cost between 40 and 79 cents per cup equivalent. These include fresh apples ($0.42), oranges ($0.58), and grapes ($0.72). Twenty-seven fruits cost more than 80 cents per cup equivalent; most of these were processed fruits, such as canned pears packed in juice at $1.00 and canned cherries packed in syrup at $2.39,” reports the USDA publication Amber Waves.

And fresh items were not necessarily less expensive than processed ones. “For example, fresh carrots eaten raw ($0.23 per cup equivalent) were less expensive to consume than canned carrots ($0.52) and frozen carrots ($0.48). Fresh apples ($0.42) were similarly cheaper than applesauce ($0.58). However, canned corn ($0.51) and frozen raspberries ($1.47) cost less than fresh corn ($1.81) and fresh raspberries ($2.32), respectively,” it said.

Source: Fruit and Vegetable Recommendations Can Be Met for $2.10 to $2.60 per Day