The lemon market has been depressed from the beginning of this season, and there are many different reasons for this situation. Even though the price is reasonable, there is no market for Chinese lemons. The competitive position of Chinese lemons in the international market has significantly declined.
The lemon production areas in Yunnan and Sichuan suffered from extreme weather conditions and their production volumes declined. The ratio of top-quality lemons is much lower than usual, which limits the number of lemons suitable for the export market. Last year nearly 80% of the lemons in storage were suitable for the export market and this year the percentage is down to 60%. The export volume declined by 20%. The purchase price in production areas increased to 1.7-1.8 yuan [0.26-0.28 USD] per 0.5 kg. That is nearly 80% higher than around this time last year.
The distribution of shipping containers across the globe is uneven. In addition, shipping is delayed because of Covid-19 regulations in many countries across the world. That is why there is a serious shortage of shipping containers in important Chinese ports such as Shanghai, Ningbo, Qingdao, and Lianyungang.
According to manager Zhang, many exporters go to extreme lengths to book enough cargo space for their export products, only to find that they have no way to secure the necessary shipping containers, or that the price has suddenly gone up. They are unable to arrange affairs before the ship leaves the port. Their products are stuck in transit ports, which puts pressure on the ports as well. And overseas buyers do not receive their orders on time. In addition, the rapidly rising shipping price causes untold anguish for exporters. For example, shipping from Qingdao to Antwerp already costs around 9,000 USD per shipping container. That is nearly four times the regular price.
"Southeast Asia has always been the largest export market for Chinese lemons. However, the outbreak of Covid-19 has significantly decreased market power in Southeast Asia and market demand is much lower than in previous years. In addition, the cost price of Chinese lemons and the shipping cost both increased, which forces Southeast Asian importers to turn their attention to alternative lemon suppliers such as Turkey and Egypt."
When asked about market predictions for the rest of the season, manager Zhang replied, "Chinese lemon supplies to Europe and the Middle East will continue until April, while supplies to the Southeast Asian market will continue until July. We expect the export volumes from Turkey and Egypt to decline after February. We hope that our export volume to Southeast Asia will then expand again."
Although export conditions are not great, domestic market conditions remain regular. "Chinese market demand for domestic lemons mainly comes from restaurants and cafes. Demand from these venues largely recovered in the second half of last year once the outbreak of Covid-19 was brought under control. Furthermore, consumer demand for lemons also increased because lemons are rich in vitamin C and support the immune system," said manager Zhang.
In addition to lemons, Jining Greenstream Fruits & Vegetables Co., Ltd. also exports pomelo, ginger, and garlic. The company has an annual export volume of more than 2,000 shipping containers.
For more information:
Mr. Zhang Shuhan - Manager
Jining Greenstream Fruits & Vegetables Co., Ltd.