Egypt is one of the largest producers and exporters of oranges globally. Egyptian citrus is also becoming more important on European markets. About 65 per cent of citrus and approximately 30 per cent of total fruit production in Egypt consists of oranges.
The Egyptian citrus production flourishes especially in the Nile delta, where water and fertile grounds are available. In addition to the delta, there is a large concentration of citrus production in the recent land reclamation areas, which are mostly located on the western side of the delta. Modern, large-scale farms produce here solely for export. The combination of a suitable climate, low labour costs and an early harvest season, makes Egypt a very competitive country.
Strategic position
Egypt characterises itself by its strategic position. In this part of the world it is the only producer of consequence, and has a comparative advantage for exporting to the Middle East, Russia and Asia, markets that traditionally import citrus and citrus products on a large scale. In the market year 2014-15, these countries and regions, together with the Netherlands which imports approximately five per cent of Egyptian citrus, belonged to the top of export countries of Egyptian citrus fruits. The export season starts mid-November and lasts until the end of August.
Several types of oranges are grown in Egypt, the following six of which are the most common: Baladi orange, Valencia, blood orange, navel orange, Khalily, and the sweet orange Sukkari. Valencia and navel oranges are the main export varieties, while the other varieties are mostly consumed locally.
Threats
Egypt has had a competitive position on the European market for years. Despite the fact that Spain has a more favourable geographical position concerning the European continent, Egypt manages to maintain its position through quality and price. Competition with South Africa is limited because the harvest season is in the July-September period. Regarding Valencia specifically, which is harvested from December, there is no actual competition.
A potential threat to the Egyptian orange production could be the Mediterranean fruit fly. Importing countries ask Egypt to use cold treatment to prevent the spread of the fruit fly. Cold treatment takes place at packaging level under supervision of the Egyptian Ministry of Agriculture and Land Reclamation, which issue certificates if the treatment is completed. In addition, the Egyptian government is funding the Fruit Fly Resistance Project, with the aim of completely eradicating the fruit fly. For example, in November 2015 the government agreed to a contribution of 15 million EGP, or about 1.5 million Euro, to eradicate fruit flies at company level.
Overproduction of citrus
Currently the Egyptian citrus production amounts to 5.8 million tonnes per year. Projections for the coming years increase to a production of 8.8 million tonnes in 2020. In recent years the price of citrus was under much pressure, mainly because of a significant overproduction. The overproduction is estimated at 2 million tonnes for 2016. The success of the previous years has led to a large expansion of the area.
The government is contemplating providing grants for digging up old citrus fields. There are also interesting developments to juice the overproduction, or to process it into concentrate, partly co-financed by the Netherlands and Dutch business. It is considered a strong point that in this part of the world Egypt is the only production country of consequence to serve the markets of the Middle East and Asia. Little competition from Brazil, Mexico and Florida is expected. This is why Egypt is in an excellent position to further strengthen itself as a major producer on the eastern markets.
Source: Agroberichten Buitenland