Good demand for Spanish oranges worldwide

The latest estimate from the USDA for Florida's citrus has been adjusted downward. The new estimate points to 74 million boxes being produced, which is six million less than October's estimate; for Valencia oranges, the decline is expected to reach 25 percent, while the volume of non-Valencia's should be 22 percent lower. Since the 2012-2013 campaign, orange cultivation in this U.S. state has shown a strong downward trend. Back then there was a production of about 130 million boxes.

The Spanish season started with a lower harvest. A heat wave in May, followed by hail and storms, has reduced the harvest by 25 percent. The quality of the fruit is lower than in previous years; however, the prices are better. Also the Navels, which are now arriving on the market, are reaching good prices.

In the fields there is already some speculation about volumes. After two to three weeks of capricious market conditions, the calm appears to have returned. European supermarkets are putting pressure on growers and traders to push prices down. Furthermore, transportation costs have increased, as larger volumes of both oranges and other citrus are entering the market.

In recent years, growers have been feeling the impact of climate change. Temperatures over the past three years have been extremely hot, which is not favourable for winter fruit.

The citrus sector, which is really divided, finds it hard to work together in order to tackle the pressure on prices from supermarkets. Competition from countries such as Morocco and Egypt looms. There is also a lot of competition from countries such Turkey, Greece and Portugal, and Spain cannot compete in terms of prices with those countries. In recent years, the number of players has been falling. Small players are disappearing in favour of medium and large players in the market. Growers are also starting to switch to other crops, such as kakis and pomegranates.

Producer organizations are currently more concerned about Citrus Black Spot (CBS) than traders. Although the risk of the disease spreading to Spain is low, growers want to avoid any risks.

Even though prices in European countries, like France, Belgium and Germany, are not particularly high, the Spanish sector is reaping the results of years of hard work to open new markets. Spain, for instance, has gained access to China and South Korea. A Dutch merchant is relieved about the rising prices. "After years of pressure on prices, we can now breathe."

An Egyptian grower explains that the acreage devoted to the Baladi and Valencia have expanded at the expense of Navels. This latter variety has a shorter export window and is therefore less attractive. Egypt is also looking at the Chinese market as a possible destination for its citrus. Other important markets are Belarus, Russia and the Middle East. In recent years, Egypt has climbed in the ranking of largest citrus producers. In total, the country has about 210,000 hectares.

The terror threat last week is still taking a toll on the Belgian orange market. A trader says that the market is quiet and that many traders are waiting. Since things have been so quiet for several days, many companies still have a good supply of oranges; therefore, imports have been smaller, and importers also have sufficient stocks. It is hoped that normality will return to the market next week.

Due to the supply of fruit from several weeks it is hard to offer a price estimate. Prices range from 50 cents per kilo to one euro per kilo, but it is difficult to know the week when the products were imported.

The harvest in Australia has been good, succeeding all expectations. There is plenty of fruit available and the quality of the oranges is satisfactory. Growers are particularly pleased with the Navels, which are doing well in the U.S. market thanks to the low exchange rate of the Australian dollar. The Valencia has also reached a good quality, but demand for it is lower.

The export of oranges has increased by twenty percent and amounted to 114,195 tonnes, which is 71 percent of the total citrus exports. These figures correspond to the first nine months of 2015. Besides the U.S. market, the Navels are also strong in China and Japan.

The weather conditions have been suitable for most growers, but that does not mean that there are no losses. On the Murray River, growers were hit by hail, causing ten percent of the expected production to be lost. The consequences of this are still unclear.

The price of water is a limiting factor for Australian orange growers. During the dry summer months, there is much to be irrigated. Prices have gone up and there is competition from almond growers. It is expected that only producers growing profitable orange varieties will continue their activities during these months.

The South American season has already finished. The period that these countries stop exporting ranges between September (for Brazil) to November (for Argentina). For Mexico, the season has only just started, while the Dominican Republic expects its campaign to kick off this month. Some countries, like Venezuela and Costa Rica, are able to supply Valencia oranges year-round.

Peru is looking back on a difficult season. Compared to 2014, volumes have dropped from 9.3 million kilos to 5.4 million kilos. It is striking that, according to statistics, no oranges were supplied during the months of April, October, November and December. In 2014, there were still oranges exported during these months. The main destination markets for Peruvian oranges are the UK, which accounts for 48 percent of all sales, and the Netherlands, with 21 percent of the exports.

Uruguay's citrus production in 2014 reached a volume of 287,000 tonnes, according to figures supplied by the DIEA. That volume was 22 percent higher than in the previous season and entailed a recovery of the production volumes achieved in 2013. Oranges and mandarins were the main products, with a total of 150,000 and 104,000 tonnes, respectively. The orange production increased by 28.1 percent compared to the previous year, while the volume of mandarins was 25.9 percent higher.

The South American country grows some twenty different varieties, including Valencia, Salustiana and Navel. Among other things, the country made heavy investments in irrigation and infrastructure.

The citrus harvest in Chile reached a record level this year, with growth in all categories: lemons, navels, clementines and mandarins. This growth has also been reflected in the export figures. While in 2014 the country shipped 57,565 tonnes of Navels, up to week 43 of this year this figure amounted to 67,210 tonnes. The main customer is the United States, which received more than 50,000 tonnes. The east coast of the United States purchased 31,595 tonnes and the west coast imported 26,892 tonnes. The third largest recipient has been Latin America, with 3,290 tonnes and Europe is at the bottom of the ranking with 1,163 tonnes.

The trade agreement between the U.S. and sub-Saharan Africa, which gives it a better position in the world market, was extended in September. However, there were some changes made, so each country has to be inspected. Furthermore, the U.S. and South Africa have have been disputing over the meat trade since June. If this is not resolved, there could consequences for the export of citrus, for which no import duties need to be paid. Last year, South African exports amounted to 3.5 million boxes.