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Egypt on the rise in orange markets

This year, Egypt might surpass Spain on the list of the biggest orange exporters, as was announced late in 2018. Because of this, the North African country threatens the dominant position of Spain on the European market. The prediction that Egypt will start playing a more important role on the orange market isn’t new. In recent years, this prediction has been made more than once. We looked at the figures and talked to citrus importer Tom Leenheer of Van Ooijen Citrus about the importance of Egypt.

Orange production in tune: blue line Egyptian oranges, orange line is Spanish oranges

“Just like every year, we’ll have to wait and see what the Egyptian season will do, but in part because Spain had such bad weather, we expect Egypt to become important,” Tom says. For the Dutch company from Ridderkerk, the Egyptian season starts in week 2 with Salustianas and Valencias. In the weeks before that, Baladi oranges are shipped.

European export rising
The Spanish season is experiencing challenges, particularly due to the shortage of large sizes, but the question remains whether Egypt can profit from that. Tom’s not quite sure: “I don’t think Egypt can fill the large volumes normally filled by Spain, although I do think they’ll manage it for the small sizes.” According to a report of Radio France International, an export of 1.65 million tonnes has been estimated for this year. Whether that figure will actually be achieved will have to be seen. In any case, the estimate means a considerable increase in export. In 2017, the last complete year with export figures available by Trade Map, Egypt reported an export of more than 662,000 tonnes. In 2014 and 2013, the record of one million tonnes was passed, but export dropped in the following years.

For the Egyptian exporters, Russia, Saudi Arabia and China are the biggest export markets, but within Europe, the country has reported an increase for some years in a row as well. In 2013, the EU imported a total of 99 million euro of oranges. Four years later, that amount is 147.5 million euro. The Netherlands is an import transit port for the Egyptian citrus. Since 2014, the volume of Egyptian citrus arriving in Europe via Dutch ports has doubled. In 2014, 56,000 tonnes of Egyptian oranges arrived in the Dutch ports. In 2017, the counter was at 115,000 tonnes.

Area (hectares) in Egypt

For export to grow like this, production also has to be increasing. In 2017, the country had 119,581 hectares of orange production. Compared to 2010, that area had increased by 18 per cent. In 2017, that area resulted in a harvest of more than 3 million tonnes of oranges. That was twice the amount of oranges harvest 20 years before that: 1.5 million tonnes. For comparison: Spain harvested more than 3.3 million tonnes of oranges in that same year. This corresponds to an increase of 18 per cent in 20 years.

Exchange rate and labour costs
The Egyptian sector profits from various sectors that make the citrus appealing on the global market. The Russian boycott of European and later Turkish citrus contributed to the chances for Egyptian exporters. Besides, labour costs are relatively low. Add to that the devaluation of the Egyptian pound, and the citrus becomes even more appealingly priced on the global market. Thanks to the decrease in the value of the currency, the fruit became relatively cheaper in, for instance, Europe. On 31 December 2018, the exchange rate was at 20.36 Egyptian pounds for one euro. Two years earlier, the currency ended the year with an exchange rate of 8.50 Egyptian pounds for one euro.

Van Ooijen Citrus also sees the increasing importance of Egypt on the European market. “The country becomes slightly more important every year, in part because companies in Egypt are constantly improving their product and packaging.” The importer himself has a clear preference when it comes to products from Egypt. “We’re never that fond of Navels from Egypt, we often think these are too dry and don’t have the right flavour,” Tom says. “Our oranges must have a good flavour, that’s our primary focus.” On the other hand, Egypt is a good partner for juice oranges. “Juice oranges from Egypt are fine, both regarding colour and flavour.” For Van Ooijen Citrus, Egypt will therefore remain a good partner for (juice) oranges and Minneolas, for now. 

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