W31: Orange Update

In W31 in the orange landscape, Brazil is the world's leading exporter of orange juice, accounting for 80% of the global market. São Paulo exported USD 682 million in juice in the first four months of 2023, with 97.3% being orange juice. The European Union (EU) is the largest market, followed by North America. Orange juice exports to the EU have slightly declined in 2023, but revenues rose by 10%. Brazil's orange juice exports to the United States (US) have significantly increased, with 275 thousand tons shipped from Jan-23 to Mar-23, a 68% YoY increase. The revenue has more than doubled, reaching USD 559 million. This growth is linked to reduced citrus production in the US and the impact of Hurricane Ian on Florida's citrus industry. The proportion of Brazilian orange juice exported to the US has risen from 19% in 2021/22 to 36% in 2022/23. Furthermore, the US Department of Agriculture's FAS forecasts a slight decrease in Brazilian frozen concentrated orange juice exports for 2022/23, estimating production of 1.125 million metric tons (mmt).

Meanwhile, in São Paulo, the industry is projected to process 252 million boxes of oranges, resulting in 1.03 mmt of juice. Other producing states are expected to contribute 24 million boxes, amounting to 96 thousand mt.

The United States Department of Agriculture (USDA) reported a 62% decline in Florida orange production for 2022/23, with 9.7 million 90-pound boxes added. California's Valencia crop experienced a 1% YoY decrease, with 1.1 million 80-pound boxes lowered, putting 2022/23 Valencia oranges down 8% YoY. Total orange production was up 13% YoY but down 10% from 2020/21. California supplied 72% of all US oranges, compared to 48% during the previous two seasons. Meanwhile, EU orange production is expected to decline in 2022/23, with 831 thousand mt processed, compared to 1 mmt in 2021. This decline is attributed to reduced production and high fresh orange prices. Spain, a major EU orange processor, is the largest, with 20% of its production used for processing, primarily for fresh juice and by-products. It was reported that in Dec-22, Spain recorded its smallest orange crop in two decades, while Egypt saw an increase in imports. This situation has sparked concerns about Spain losing its leading position in orange production and export to Egypt.

From Jan-23 to May-23, Egypt imported more than 15 thousand tons of oranges, followed by an additional 10 thousand tons in Jul-23. Spain currently has 50% of orange production in the Valencia Region and 45% in Andalusia, with slow but steady abandonment of citrus plots. In Andalusia, 65% of oranges are grown in the Guadalquivir Valley due to water shortage issues. This means that production in Spain is unlikely to grow in the short and medium term. Egypt's position as the leader in orange exports is high, but the decline in orange consumption is also a concern.

Lastly, Zimbabwean media reports that new citrus plantations are being established along the Mupfure River in Chegutu, central northern Zimbabwe, to increase exports. There is a plan to send 50 thousand metric tons of citrus to China. Zimbabwe's former ambassador to China confirmed that there's an agreement with Chinese contacts to meet this export quota. Zimbabwean citrus fruits, including sweet oranges, mandarins, grapefruits, lemons, limes, and bitter oranges, gained access to the Chinese market on July 1, 2022. China's General Administration of Customs (GACC) announced conditions for Zimbabwean citrus shipments through third countries, allowing mandatory cold treatment during transit. Zimbabwe is preparing for its first-ever citrus shipment to China, and negotiations are ongoing for Zimbabwean blueberries, avocados, and peppers.