The Andalusian orange sector has been waiting for weeks for a recovery of the fruit's prices that has yet to happen. In fact, despite sharp falls compared to last season, prices have continued dropping, going from 17 cents per kilo in week 46 to 14 cents in week 49, according to data provided by the companies collaborating with the Prices and Markets Observatory of Andalusia. In the latest week analyzed, there has been a 51% drop of the value compared to the same week last year, and the situation continues, as confirmed by José María Corredera, manager of the Seville second-grade cooperative Zuman.
"Fresh orange prices are still very low, although they depend a lot on the variety and size. The last purchase prices of Navelina oranges, of which there is still a great volume to be harvested, ranged between 10 and 12 cents per kilo, while those of the Salustiana stood between 14 and 15 cents on average. As for industrial oranges, their price ranges between 12 and 14 cents, and from that we must take away the costs of collection, which amount to about 5-6 cents per kilo, so the grower is only earning between 6 and 8 cents gross per kilo on average," explains José María.
"The processing industry receives the less commercial sizes; fruit that has been discarded. In the past there were growers who produced oranges for the processing industry, but since the subsidy for this activity disappeared at the end of the 1990's the profitability of the industry has been minimal, except for a couple of years when the Brazilian company Citrosuco, leader in the world orange juice market, was here."
"However, this year the lack of rainfall has had an impact on the calibers, which are getting smaller. In fact, there are farms that have not had any rain since October 1. The low prices of oranges for processing are causing growers to try to sell their oranges for fresh consumption. They are even harvesting at the farm by size, despite the fact that this leads to cost increases. In other words, only the larger sizes are harvested and the rest of the fruit is being left on the tree to wait for better prices. And this in turn is limiting the industrial activity."
The perfect storm
The events of recent months have been decisive for Andalusian oranges to end up in their current situation. It should be recalled that, as reported a few months ago by the Andalusian Council of Agriculture, 70.5% of this campaign's Andalusian citrus will correspond to oranges, with a production estimated at almost 1.7 million tons.
"This year we've had a perfect storm," says José María Corredera. "In addition to a lack of water and smaller sizes, there has been a delay in the arrival of citrus from South Africa to the European market, causing an overlap with the Spanish campaign."
"The country had problems shipping its citrus in August and September, and the large stocks it had accumulated arrived all at once. In fact, there is still fruit from South Africa that, although it is not as good as ours, it is very cheap, and retailers continue to sell it," says the manager of Zuman. "A 15 kilo box of South African oranges has been marketed in Amsterdam for 6 Euro, while we need between 12 and 15 Euro to make it profitable. You have to take into account that the oranges in the box have already been harvested, handled, packed and transported, and we have triaged it by discarding smaller calibers of oranges of the same quality that have to be sold at lower prices."
"The difference with South Africa, as well as with other third countries that ship their fruit to Europe, lies in the costs. They have very low costs compared to ours when it comes to labor and even social security or occupational risk prevention. Moreover, they have other phytosanitary legislation and there are products banned in the European Union for their carcinogenic potential that are used in those countries, as evidenced by the interceptions at the borders reported by the RASFF."
The European Commission's rapid alert network for foodstuffs reveals that, so far in 2021, the EU has rejected a record amount of citrus fruits from Turkey and Egypt due to the presence of pesticides above the MRLs, or for containing pesticides banned in the EU, such as chlorpyrifos and its derivatives. Records have also been broken when it comes to the number of interceptions of South African citrus batches with the presence of dangerous pests, such as the Phyllosticta citricarpa or Thaumatotibia leucotreta, better known as black spot and false codling moth, both not yet present in European citriculture, unlike the cotonet.
"Those are the ones that have been intercepted. The question that remains is how many will have entered," says José María Corredera. "And there is yet another threat related to the juice industry. Brazil is the world's leading juice producer and our main competitor, but there they are having a big problem with HLB and our fear is that it could reach the Peninsula through the disease's insect vector, the Tryoza erytreae."
As José María Corredera stresses, Andalusia cannot compete with these countries in terms of either costs or labor, but it can with the differentiated and "extreme" quality of the fruit, which in the provinces of Cordoba and Seville, where 5 of the 7 cooperatives of Zuman operate, is even recognized with the quality brand Naranjas del Valle del Guadalquivir.
The second grade cooperative Zuman is formed by the Seville cooperatives Alcafruit, Hortofruticolas Naranjales del Guadalquivir S.C.A., Coop. San Sebastián S.C.A. and S.A.T. Síntesis; by S.A.T. Sunaran, from Palma del Río, Córdoba, and by the Cadiz entities Coop. Campo de Guadiaro S.C.A. and Tesoricoop. The group's production of industrial oranges has averaged 30,000 tons in the last 5 years.
"Our oranges are grown with minimal treatments and even in an organic regime, guaranteeing at all times to consumers the supply of fully safe and residue free fruit."
"Our sector not only contributes to the economy, but also helps retain the population in rural areas. One of Zuman's 7 cooperatives alone has around 280 workers for the harvesting in the field, and another 400 in two shifts in the warehouse. If we want the population to stay, we need a profitability that allows us to do so."
Progress is also being made in terms of differentiation. Just like with mandarins, the club varieties segment gave rise to a new marketing concept, in many cases directed by the club itself, with a superior profitability compared to that of traditional varieties, and, despite the existence of royalties, tests are being carried out by different breeders in the orange segment, says José María. "In fact, our own cooperatives are conducting crop trials of various club varieties and different rootstocks. But, as long as the profitability of our farmers is so low, it will be difficult for them to undertake investments for which you have to wait 4 to 5 years to see the result."
"And that is precisely why we demonstrated in Cordoba, to protest against the low prices that our growers perceive in the field," stresses the manager. "Cordoba hosted the first of a series of demonstrations following in the rest of the provinces of Andalusia."
For more information:
José María Corredera
Polig. Ind. Ctra. Amarilla, C/ Mastín 2
41007 Seville, Spain
Tel.: +34 696 311 571