China: Will Shatang oranges avoid the unmarketable condition of Nanfeng tangerines?

The news of unmarketable oranges in Guangxi has recently gone viral. The Nanfeng tangerine in Guilin, for example, sells at 0.25 yuan [0.04 USD] per 0.5 kg, and traders are still not interested. The overall surface area devoted to citrus plantation in Guangxi exceeds 467 thousand hectares. Farmers can lose their life's savings under these circumstances. Shatang oranges are only just entering their market season. Will they avoid the unmarketable conditions of Nanfeng tangerines?

People in the industry think that the differences between the two are great enough to avoid disaster. First, Shatang oranges taste much better and the overall product quality is higher. Second, Shatang oranges enter the market around Chinese New Year and have no real competitor.

Nanfeng tangerines compete with Huangdi tangerines, which is quite a strong opponent, while Shatang oranges only enter the market after their supply season comes to an end. Market competition is not as fierce then. Furthermore, people like to gift oranges as New Year presents. Demand for oranges is huge around Chinese New Year. Even though the production volume of Shatang oranges increased, the market is able to absorb the supply volume, and the price will not fall that far.

The price of Shatang oranges mainly depends on the amount of rainfall late in the season, and whether north China has large snowstorms that close off the roads. However, the price is not as stable as it was a few years ago when the overall surface area devoted to Shatang orange plantation was much smaller. Based on current production volume, plantation surface area, and market demand, the Shatang orange price of 3.1-4.5 yuan [0.45-0.65 USD] per 0.5 kg still leaves a certain profit margin.

Source: Lingnan Nongjing


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