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Australian orange production to rise by 470,000T

Orange overview
Australian production of fresh oranges in 2016/17 is forecast by Post to increase to 470,000 metric tons, due to good seasonal conditions and improved access to water irrigation. Australia is a counter cyclical exporter of oranges to northern hemisphere markets while the United States exports oranges during Australia’s off season. Over 2016, Australia’s free trade agreements with China, Japan and South Korea continued to open up opportunities for citrus exporters. Post forecasts exports of oranges to reach 230,000 MT in 2016/17.

The proportion of fresh orange production used for domestic juice is forecast by Post to decline to 70,000 MT in 2016/17. Fewer oranges are being processed into juice because of falling demand for juice and lower returns for growers, while imports of orange juice and concentrate have become more important. Many growers are moving away from juicing varieties of orange such as Valencia and towards eating varieties such as Navels. Australia’s citrus industry is a major horticultural sector and a leading exporter of fresh fruit. Australian exports of oranges for 2016/17 are forecast by Post to reach a record of 230,000 MT due to higher production and greater demand for exports in North Asian markets.

Trade overview
Oranges account for around 80 percent of Australian citrus exports, with the balance being exports of mandarins, as well as small volumes of lemons and grapefruit. Exports of navel oranges commence in June with early navels (e.g. Navelina, M7) and end in October with late navels (e.g. Late Lane, Chislett and Barnfield). The Australian citrus industry is export- oriented and is a competitive counter seasonal supplier to northern hemisphere markets such as Indonesia, China, Japan, Korea and the United States.

Australian exporters have benefited from lower tariffs in key markets such as Japan, Korea and China following bilateral free trade agreements (see below). Post forecasts imports of oranges into Australia to decline in 2016/17 to 30,000 MT. Post has also revised imports in 2015/16 to 30,000 MT, below the official estimate of 35,000 MT. Australia imports fresh oranges during its summer season, when there is no local production and the United States is the predominant supplier during that period. The volume of U.S. exports of oranges to the Australian market has declined over the last year in response to exchange rate changes and flat domestic consumption, while imports from other countries have increased.

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