"The start of this citrus season has been marked by historically low demand"

The Spanish citrus season, which kicked off in September with the first extra-early mandarins, is currently underway with more consistent quantities, although with lower volumes compared to this same time in the previous season. Although clementine sales are taking off slightly, there is still concern about the calmness that prevails in commercial operations. Higher production and handling costs will be a determining factor in the returns for much of the value chain.

"Clementine sales are rising a little and, for the time being, we are selling at prices above those of last year, although it should be taken into account that production costs have increased by between 18 and 23% compared to the previous season," says Alejandro Peiró, commercial director of Peiró Camaró, a Valencian company based in the municipality of Algemesí which is marketing around 35 million kilos of clementines and oranges per year, 40% of which they produce themselves. "Large-scale retailers, which have the greatest purchasing power at present, are not always willing to raise purchase prices. But the way to carry out negotiations is changing, not only because of the rise in costs, but rather because of the possibility of a product shortage in the case of clementines, which could give us greater bargaining power if there is a good demand," says Alejandro Peiró.

Alejandro Peiró, commercial director of Peiró Camaró.

But it is precisely the demand that is lacking this year, since export volumes have so far been significantly lower compared to last season. An example of this is the drop in citrus exports to third countries up to October 31 so far this season. These totaled 12,779 tons, compared to 21,394 tons in the same period of the previous season.

"The start of this citrus season has been marked by historically low demand," says the grower and exporter. "Retailers are also dealing with difficulties to sell. We will continue to try making sure that the increase in production costs is reflected on the selling price. We also hope that prices at origin won't shoot up as much as in the previous season, given the difficulties to keep prices high in the market. It is worth recalling that more than 40% of the Clemenules, the most cultivated variety in the Region of Valencia, will be lost due to pest issues and the impact of rain and hail," he says.

Orange sales still stagnant
As for oranges, the situation is much more concerning, as sales have been very quiet at the start and prices very low, mostly due to a great overlap with imports from the southern hemisphere. In fact, in the week of October 25-31, 675 tons of southern hemisphere oranges entered Europe.

"The Spanish orange harvest has started very slowly. Until well into August there were still Late Valencias from Egypt available, and at the moment there is still a great supply of oranges from South Africa. Many of the buyers from supermarket chains keep telling us that 'there is still a lot of South African fruit in storage, sold at prices amounting to around 0.55 Euro. Meanwhile, the price of the first Spanish Navelinas doesn't even cover the production costs. An increase in the demand will be essential," says Alejandro Peiró.