Global
Smaller Harvests of Apples in the Southern Hemisphere (Mar 28)
The initial forecast for the 2023 season, which estimated 6% growth for apples compared to 2022, has been revised in light of intense weather events affecting several countries in the southern hemisphere. Apple harvest forecasts for New Zealand and South Africa have been revised downwards by 77.9K MT and 77.28K MT, respectively. The updated 2023 Southern Hemisphere apple harvest forecast suggests an increase of 2% to a total of 4.975M MT compared to last year (4.859M MT). Smaller apple harvests are expected in New Zealand (457.68K MT, -9% compared to 2022), Australia (-8% compared to 2022, to a total of 290K MT), and South Africa (1.143M MT, a decrease of 5%). Chile remains the largest producer (1.41M MT, according to 2022), followed by Brazil (1.15M MT, +12%). Apple production in Argentina should reach 525K MT (+24% compared to 2022). Gala, with 1.843M MT, remains by far the most popular variety, and its production is expected to increase by 4% compared to 2022.
Europe
Organic Apples, the Dialogue Between Italy and France (Mar 31)
Faced with a particularly delicate economic situation for the apple sector in organic farming in Europe, the representative structures of the Italian and French economic organizations wanted to engage collectively in a reflection on the future. The numbers of Italy and France with 193K MT and 227K MT, respectively, Italy and France are the two largest producers of organic apples in the European Union and represent 64% of the 658K MT of European production. Encouraged by European and national public policies, conversions have been very dynamic, the surface of organic apple trees in France thus increased from 5.52K ha in 2019 to 9.09K ha in 2022, while in Italy from 2017 to 2021 it increased from 6.2K to 8.24K ha. The consumer crisis with the succession of various crisis factors, health, geopolitical, and now economic, consumption, unfortunately, has not followed production. Economically, when supply far exceeds demand comes structural surplus and that is exactly what is worrying organic apple producers right now. The strong organization of the French and Italian fruit systems manages now to mitigate the aforementioned effects, but for the future, both a revision of the incentive policies for organic apple orchards and actions to provide greater support for consumption are certainly needed.
France
Reduced French Apple Stocks in February (Mar 31)
At the end of February 2023, apple stocks in France, measured over a year, are down 11% and are 2% below the five-year average. A significant part of the 2022 yield, in some growing areas even up to 20%, is no longer usable due to the traces left by a heat wave and has been transferred to the processing industry. As a result of these quality problems, sorting was more selective after harvest and during storage, which reduced the number of batches stored. Most varieties, therefore, saw their stocks shrink during the year. For example, the Gala variety, which was hit by the heat wave this year and as a result only developed small sizes and suffered from sub-optimal quality, stocks have decreased by 16%. Stocks of the Golden and Granny-Smith varieties have also decreased, to be precise 18% and 20% respectively. Pink Lady stocks, on the other hand, have increased by 67%. Since November 2022, apple prices have been above last year and above the five-year average. After a slow start, sales are on the rise again, especially from February (+17%). Consumers are looking for the best products (in bags, with a discount). On the export market, sales of the number of French apples that are exported to Spain and the Netherlands are increasing, but sales of the number of apples that are exported to the United Kingdom and Germany are decreasing. Between August 2022 and January 2023, due to a dynamic start to the season, the cumulative volume of apples exported to the other EU recovered over the year (+11%).
Poland
According to official data from the Polish Ministry of Agriculture, apple exports from Poland increased in value and volume in January 2023, reaching 68.84k MT. Last year, shortly after a ban on Polish apples was imposed by Belarus, it quickly reversed the decision, and Poland exported approximately 25K MT from April to June 2022. As the industry enters the final stretch of the 2022/23 apple sale season, Tridge predicts that export volume will continue to grow due to Belarus's opening, while the export value will slow down in Q2 of 2023. (Continue Reading)
Serbia
Serbian Apple Exports Declines in January 2023 (Mar 27)
In the fruit market, the most significant changes in Serbia's foreign trade were recorded in the segment of apples. It should be noted that the first month of 2023 turned out to be unsuccessful for the exporters of this fruit. Thus, the export of apples from the country in January updated the anti-record, dropping to 8.74K MT. Russia remained the main consumer (6.31K MT), although the general geography of the buyer countries, as before, is very diverse. In January 2023, Serbian apples were delivered to the markets of 24 countries.
Brazil
Apple Exports in Brazil Are at a Slower Pace (Mar 29)
The expectation is that the 2022/23 apple crop will register a slight increase in volume when compared to the previous one. However, fresh fruit exports declined significantly in the first months of the year. According to Secex, Brazilian apple shipments were just 29MT in February, 99% less compared to the same month last year. Revenue was USD 74K (FOB), down 97% in the same comparison. This occurred, according to agents consulted by Hortifruti/Cepea, due to the delay in harvesting the crop, which opened doors for imports and reduced domestic shipments. Still, with the low supply here, when the harvest started, producers and classifiers gave preference to supplying the domestic market. Overall, despite this significant initial drop, Brazilian apple exports in 2023 are expected to be better than those of the previous year, due to the greater volume harvested, especially gala.
Ukraine
Why Are Ukrainian Apple Growers Grubbing Orchards While Rising Domestic Prices Prompt Imports? (Mar 29)
According to EastFruit analysts, in the 2022/23 season, Ukrainian gardeners can uproot record garden areas. At the same time, the situation in the fresh apple market in Ukraine is becoming very dynamic and may lead to a sharp increase in the price of fruit in the near future. Looking at the wholesale prices of apples in the current season, even in US dollars, the situation does not seem catastrophic. Prices are right in the middle between the best price seasons like 2019/20 and 2020/21 and the low price seasons like 2018/19 and 2021/22. The prices for one of the most popular apple varieties, Golden Delicious, are now 58% higher than a year ago and 73% higher than in 2018/19 when some farmers fertilized their fields with apples. Moreover, we believe that in the period from the end of March to July 2023, the average wholesale price for an apple in Ukraine may increase significantly, which will lead to an increase in imports of fresh apples, mainly from Poland. Why, then, do Ukrainian gardeners uproot gardens? “While the cost of apple production reached an all-time high in 2022, this led to losses for many apple growers and forced them to grub up," said Andriy Yarmak, an economist at the Investment Center of the United Nations Food and Agriculture Organization (FAO). "Due to the sharp increase in the costs of crop protection products and the shortage of labor, not all growers carried out the treatments on time. This also had consequences for apple storage, insofar as someone decided to store despite the risks. Due to a power cut, the poor storage conditions, as a result of which there were not enough high-quality apples from Ukraine on the market at the end of March to cover domestic needs, so prices are now starting to rise, even in the segment of medium and low-quality apples ,” adds the FAO expert.
Hungary
Half of Hungarian Apple Plantations May Disappear (Mar 28)
In the next ten years, approximately 10K ha of apple-growing land may disappear. One of the main reasons for this is that it is not worth maintaining the mostly out-of-date cultivation methods. The primary reason for last year's large crop loss is due to weather damage, although in 2022 the apples were not destroyed by frost damage, but by the preceding drought. Last spring, the flowering was already weak, so it was already clear that there would be no outstanding crop. In addition, in the northeastern region, where 70% of the apple-growing area is located, there was a cooling during Easter, which probably worsened the condition of the flowers. The loss of crops is not only caused by weather damage but also by the fact that the Hungarian apple-growing area is constantly decreasing for 5-8 years. In addition, the plantations are constantly aging: most of them have already passed the age of 20-23 years, and around the age of 23-25 their performance falls rapidly. The experts believe that even more people will abandon apple cultivation in the future, since three years ago the domestic apple-growing area was 25K ha, last year only 22.5K ha were measured, and this year there will be no more than 20-21K ha. The trend will continue in the following years: from January 1, 2022, to December 31, 2024, there is an eco-subsidy system that will keep many outdated plantations alive.
Data Analysis: The Price of Hungarian Apples Rose by 12% MoM on Supply Shortages (Mar 29)
The wholesale price of Hungarian Idared apples has increased to USD 0.89/kg (HUF 310). This represents an 8% WoW and a 12% MoM increase. The price has been rising since early February due to a supply shortage in the domestic market. Apple orchards are continuously getting older. Major Hungarian apple trees are already passed the age of 20 to 23 years, and performance starts to decline at age 23 to 25. Since last year's catastrophe, Hungarian apple producers are less motivated to continue growing apples. In 2022, Hungary produced 280K MT of apples, 45% fewer than the year before. Prolonged drought is the main cause of the significant crop loss from the previous year. Because of this, apple prices in Hungary increased significantly last summer. A lack of apples in the domestic market is the result of shrinking apple-growing areas in Hungary. To ensure supplies in the domestic market, Hungary will focus more on importing apples from nearby countries like Poland, Germany, and Austria.
