Chilean clementine supply to US up by 53 percent

The easy peeler market is active and product is moving moderately well despite continued hot temperatures and greater consumer attention being afforded to local summer fruit. Nonetheless, retailers continue to give easy peelers adequate shelf space. That is good because there is a lot of soft citrus in the USEC market with clementines and mandarins from Chile, Peru, South Africa and Uruguay all vying for consumer attention.

As we have reported for the last few weeks, this season Chilean shippers have loaded substantially more clementines to the US market than they did last year, 53% more to be precise. Thankfully, the bulk of this increase has been directed to the USWC.

Indeed, with increased easy peeler volumes arriving from Peru that until now have been mostly focused on the USEC, and in spite of relatively good movement at retail, clementine and mandarin prices on the USEC for standard sizes (2, 3 and 4) in a 10 x 3 lbs bag configuration are sitting at US$ 26 – 28 with some sales lower. Prices for size 5 are $2 - 4 lower.

Chilean clementine loadings have now ended and W. Murcotts are in production. However, lack of rain has delayed the drop of acids in the fruit and has slowed the development of colour. The result has been a slow start to the Chilean late mandarin harvest. Through week 31, Chile loaded 4,885 metric tons of late mandarins to the USA (both coasts), less than one-third the volume shipped through the same week last year.

But the market will not run out of easy peelers while Chilean packers wait for their harvest to gain momentum. First of all, there is a soft citrus inventory in the market to be depleted. In addition, Peruvian late mandarins are arriving in strong volume, the last of the Chilean clementines will arrive in the next two weeks and South Africa will continue to land modest volumes of easy peelers. No easy peeler gap is expected.

The important question is what volume of late mandarins will Chile actually produce and how big a marketing window will it be afforded. The Citrus Committee of ASOEX, Chile’s fresh fruit growers’ association, had originally forecast a 30% increase in late mandarin exports predicting that Chile would export 100,000 metric tons this season, almost all destined for the USA. But, owing to reports of widespread freeze damage in Chile’s V Region, the Citrus Committee decreased its projected mandarin export growth to 20%. That is still 92,000 metric tons to sell.

Navel orange prices in week 32 continued to reflect the combined factors of moderate movement of a big inventory that is skewed toward smaller sizes.

South Africa’s fifth bulk vessel of the season completed her discharge at Gloucester, NJ in week 32 bringing the total South African navel orange volume landed on the USEC to 23,706 pallets (approximately 1.65 million cases) since the start of the season. Average fruit size from South Africa has been increasing with each successive arrival, the most recent of which carried 62% sizes 64 and larger and 39% size 56’s and larger.

The Chilean navel harvest has picked up its pace. Steady and heavy loadings in each of the last three weeks has allowed Chile to make up all of the ground it lost in the early weeks of the season. Chilean navel orange loadings to the USEC through week 31 are up over last season by almost 15%. Loadings to the USWC are up by almost 12%. The USA continues to be the destination of 100% of Chile’s navel orange exports.

Navel movement has been moderate but uninspired for the last three weeks with the product taking a back seat to summer fruit, berries and, of course, easy peelers. But there are signs - subtle ones – that the market is waking up and that the pace of navel sales will start to increase in the coming days. Generally lower prices in the market have had a role to play in this. As well, children will soon go back to school and demand for a 3 lbs value pack of 88’s and 72’s will increase, making it worthwhile for retailers to devote greater shelf space to oranges.

In the meantime, navel prices remain soft. Large sizes are at US$ 20 – 22 (mostly US$ 20), 64’s are at US$ 18 – 20 (mostly US$ 18), 72’s are at US$ 16 – 18 (mostly US$ 16) and 88’s are at US$ 12 – 14. Bagged 88’s and 72’s in a 9 x 3 lbs configuration are selling at US$ 16 with lower prices observed in the market.

Navel prices will likely remain at these levels for the next couple of weeks until expected increased demand reduces inventory pressure. By week 35, we hope to see prices start to rise.

Chilean lemon volumes shipped to the USA have now reached - indeed exceeded - the volumes shipped last season. But the effect has been quite different. A strong lemon market throughout the summer and light domestic production has kept inventories low and pricing strong. Mexican lemons are now entering the US market and the party may soon be over. But it’s been a good run.

Through week 31, 75’s, 95’s and 115’s have been selling at US$ 46 – 48 with some sales higher and 140’s and 200’s are selling at US$ 42 – 44.

The Peruvian Minneola market is stable but tending slightly downward on the heavy volumes of navel oranges and easy peelers with which they compete for shelf space and consumer attention. On the USEC, Minneolas are selling at US$ 14 – 15 for 30 series and 40 series. Prices on the USWC are slightly stronger.

For more information:

Mark Greenberg 

Tel: +1 (514) 739-9181