W20: Lemon & Lime Update

In W20 in the lemon and lime landscape, it was reported that the Argentinian citrus sector is facing setbacks due to drought, inflation, and currency issues. The Argentine government has declared a state of emergency for lemon growers in Tucuman province, and the government is trying to avoid a currency collapse. The recently announced measure to import food at zero tariffs is unlikely to affect exports, but markets are strong with slightly better prices and freight costs. Canada, Russia, the Philippines, and Europe are all in need of oranges, but restrictions and customs costs are killing the industry. In California, Limoneira, a Santa Paula-based grower of lemons and avocados, has signed an exclusive licensing relationship with Apeel Sciences, a Goleta-based company that has developed a system for increasing the shelf life of fresh produce. Limoneira will be Apeel's first fully integrated lemon supplier in the U.S. and will coat 5M cartons worth of lemons with Apeel's technology through the end of the year. James Edwards believes the technology will increase consumption and create a better experience for everyone. Limoneira shares have remained flat since the announcement, closing at $16.23 on May 17.

The price of Spanish lemons has increased due to the widespread consumption of the Verna type of lemon. The pricerose 29% in the open field and 25% at the OP/plant. Further, Spanish lemon producers have agreed to suspend Class 2 lemons due to poor returns that are failing to cover production costs. Ailimpo, the Spanish interprofessional lemon association, said the low level of returns was resulting in losses for both growers and marketers. The objective of the action was to persuade the market to return to paying minimum acceptable prices for the products rather than continuing to sell at a loss. The lemon season in Mexico has started earlier than usual, with good volumes and a wide range of sizes. This season is expected to continue until the second half of December due to increased rainfall. Current supplies come from Ciudad Victoria, Montemorelos, and Hermosillo. Demand is low, but Gudino anticipates higher demand as temperatures rise. Lastly, Tahiti acid lime prices remain low in Brazil due to increased supply and lower absorption of the European market. Also, lower temperatures have also limited domestic demand.