The laments coming from production areas around the world may bode a more stable beginning for the California navel and mandarin industry this October. Reduced supplies from Chile and South Africa appear to have eliminated inventory issues and lingering fruit in the U.S. market, thereby setting the stage for demand at the outset of the season.
A chilling dynamic is that buyers are beginning to balk at the higher asking prices being quoted in contracts from marketers. They remember the cheap prices they experienced last year and are hoping to replicate that phenomenon this year.
Orange and mandarin exporters from Chile and South Africa have commiserated publicly about their inability to move increased volumes into the United States. Part of their problem is over-estimating the utilization of their respective crops. Their price foundation appears to have been a carryover from this past season as well.
The last arrivals from the Western Cape of South Africa are expected to land in about two weeks and play out through the month of October. The Chilean tonnage may last a bit longer and interest will focus on how low their price goes and whether the quality is satisfactory. Chilean volume is off by approximately 2.5 percent or 2000MT.
All citrus imports into the United States were lower than the previous season which again could be a stronger foundation for the California start. Orange numbers were down significantly, Mexican limes were down a bit, South Africa was down significantly, and countries such as Uruguay, Peru, and Mexico a mixed bag with significantly at a lower tier than South Africa or Chile. The lemon numbers were up primarily because of Mexico and Chile. Argentine had a slight increase from almost zero the year before. The latter continued to have quality issues and protocol challenges.
General numbers of concern: Total citrus imports have nearly doubled in the past five years. The market share in China dropped significantly, the Japan tonnage for California is off 25%, and according to the National Agricultural Statistics Agency, California’s share of the U.S. citrus tonnage is 51% since Florida rebounded from a hurricane disaster. However, we dominate fresh sales from a domestic source leveling off with over 80% of fresh sales across the country.