W49: Weekly Apple Update

Europe

Consumption of Gala Apples in Europe Reached 60%

In terms of consumption, the Gala variety leads the European market of commercial apples, accounting for 60% of sales. It is followed by Golden Delicious, although over the past 10 years, consumption of Gala has been increasing and Golden has been falling. If a producer plants an orchard today, it should be 60-70% red varieties, mainly Gala, and 30% green apple, mainly Golden Delicious Reindress, SanoTree specialists advise. Focusing on the export of apples is the only correct decision in today's market situation in Ukraine. The priority markets should now be the markets where barrier duties have been removed, Great Britain and the EU. There, Ukrainian producers can have a competitive price, for example compared to the Poles. In addition to the variety, when buying planting material, it is very important to take into account its origin, the purity of the seedlings and the reputation of the suppliers.

China

The Chinese Are Tired of Fuji Apples and a New Niche Is Opening for Exporters

An excellent window has opened on the Chinese apple market for exporters to enter the market, who will be able to offer something new. In addition, local gardeners have shifted their focus to grapes and reduced the area of ​​apple plantations. The weather has also made its own adjustments. Due to abnormal weather conditions and a reduction in planted area, China's apple and pear production is expected to decrease by 11% and 5%, respectively, in the 2022/23 season compared to last year, to 41 million MT and 17.85 million MT respectively, according to USDA analytical report. Currently, more than 75% of the apples on the Chinese market are Fuji varieties produced in orchards that are over 40 years old. Fuji apples have been the dominant variety in China's apple industry for decades, but Chinese consumers are losing interest, and the lack of new varieties is limiting the growth in apple consumption. As domestic production increases and varieties improve, grapes and citrus fruits, among others, compete with apples. Thus, the profitability of apple orchards with Fuji varieties is falling. Minus production and the weather with its desire for global warming. For example, in Shaanxi and Shandong, the largest apple-growing regions, high temperatures during the flowering period slow down fruit sets. Due to low market returns, many horticultural farmers in western production areas such as Shaanxi and Gansu are cutting down apple trees, and the area under cultivation is shrinking accordingly. Industry reports have noted that over the past two years, farmers in northern apple growing areas such as Hebei, Henan and Shandong have also been cutting down trees. Some old apple trees in northern Shaanxi have been replaced with new varieties, but these young trees have yet to bear fruit. The area planted with apple trees in the 2022/23 season is estimated at 1.935 million hectares, which is 2% less than in the 2021/22 season.

Apple imports to China are expected to rise by 35% in the 2022/23 marketing year to reach 100,000 MT. Breeders in New Zealand, the main supplier of apples to the Chinese market, have developed several new varieties specifically for the Chinese market while South Africa, the second largest supplier, is stepping up marketing. US apple trade with China does not look too rosy due to mutual tariffs, so the supply of American apples to China is likely to be significantly reduced. Apple exports from China are expected to fall by 20% to 800,000 MT in the 2022/23 season. Over 90% of Chinese apples are exported to ASEAN and South Asia, where reduced domestic production will lead to higher export prices. The situation is similar for the Chinese pear market: low profits and an ageing workforce have forced farmers in traditional growing areas such as Hebei and Henan to take up the axe.

Italy

Apples, a Long Stability Is Expected

For apples, the end of the harvesting campaign and storage is signalled. The current quotations should remain unchanged at least until the first months of next year.

Poland

Egypt Is One of the Largest Importers of Polish Apples

Miroslav Maliczewski, head of the Polish Apple Association, said that Egypt is one of the three largest countries in the world that imports apples from Poland. Malyshevsky added, in a press conference entitled "It's time for European apples" on the sidelines of the seventh session of the "Food Africa" conference on December 5, that Poland began exporting apples to Egypt in 2018, and the export rate increased by 10% every year. Poland exports to Egypt two types of apples: Gala and Delicious Yellow apples, according to the head of the Polish Apple Association. He stated that Poland exports 150 thousand MT annually of Polish apples to many countries such as Serbia, Italy, Austria, Belgium and Egypt. According to him, the Egyptian market is one of the most targeted markets to increase the volume of Polish apple exports to it.

Spain

The Price of the Spanish Golden Apple More Than Doubled in 2022 Compared to 2021

In the 2022 season, the production of golden apples turned out to have a more yellow coloration. This feature is valued in the domestic and European markets, but not in international markets. Additionally, prices in W48 are significantly higher than prices in 2021. In 2021, the price of golden apples was USD 0.32-0.42/kg EXW in the field, while growers in W48 received between USD 0.63-0.74/kg. For medium sizes 100-88, market sales prices are around USD 0.95-1.11/kg EXW.

Frost in 2022 Caused Low Production and Quality Issues in Spain’s Main Apple Producing Regions

The regions of Catalonia and Bajo Aragon in Spain, where the majority of apple production is concentrated, experienced frosts in April 2022, resulting in the current shortage and quality issues in the market. According to exporters, shipments are arriving at their destinations with bitter pit problems, between 1-3% of apples per container. This is due to fewer apples on the trees, which absorb nutrients in an unbalanced manner. Bitter pit problems also may arise as a result of a calcium, magnesium, and potassium deficiency. The work of measuring nutrients in the field aids in control but does not guarantee eradication of the problem.

Moldova

November Export of Moldovan Apple, the Minimum Figure in Five Years

According to the customs service of Moldova, in November 2022, about 7 thousand MT of apples were exported from the country. This is the lowest figure for November exports over the past five years, only in 2020 it was close to the current one, almost 8 thousand MT (but then curbing supplies was a tactic, in the hope of active winter supplies to the Russian market at a higher price). In the same month of 2021, exports were a record, 22.5 thousand MT. The main direction of supplies of the Moldovan apple in November of this year is the CIS countries. However, representatives of farmers' organisations believe that the situation in alternative markets is also not bad: deliveries of almost a thousand MT of apples to the markets of the Persian Gulf countries, and, most importantly, more than 600 MT to Romania. For November, when there is still a local apple on the Romanian market, and more diverse/ high-quality products from neighbouring European countries, this is a good result for Moldovan exporters. Traders-exporters do not predict big “apple traffic” from Moldova in December. The bulk of consumers in all markets in the pre-New Year period switched to citrus and exotic fruits. Suppliers do not rule out a gradual increase in shipments to export markets and "budget" apples, but not explosive.

Is the Price Argument Between Moldova and Poland Still Crucial in Apple Exports

When it comes to exports from Poland last year, we also achieved a very good result of over 47,000 tonnes. This year, exports are much smaller due to problems in the Egyptian market and the closure of the Belarusian market. Comparing the two countries, it can be seen that Polish exports fell by 34% YoY, and Moldovan exports by as much as 68%. From Polish exporters, it can be learned that the offers of Moldovan exporters are much higher than the prices offered for Moldovan apples on external markets. As such, it can be seen that the price argument still holds a lot of weight. The lack of a Russian market has an immediate impact on Moldovan exports. A lot of information about trade with Egypt and the increased interest in Moldovan apples by buyers from Arab countries has so far not been reflected in the data, which is very bad for the local fruit industry.

Moldovan Traders Expect to Boost Apple Exports to Romania From the Beginning of January 2023

Operators of the Moldovan fruit market expected an increase in the supply of apples to the Romanian market in December this year. But, as noted by representatives of fruit growers' organisations in Moldova, there is no obvious revival of supplies compared to the November figure, which amounted to just over 600MT. However, encouraging signs of an increase in demand for imported apples from Romanian wholesale buyers have already appeared at the end of November. Supermarket chains have started buying Polish apples, which are of large calibre but not ideal in other quality parameters. Against the background of local Romanian products, it looks advantageous, but, according to Moldovan traders, their product “in terms of quality is quite competitive compared to the Polish apple that is currently sold in Romanian chains.” Another thing is that Romanian retailers are ready to buy, in particular, Moldovan "Golden Delicious" at a price of no more than USD 0.52-0.57/kg (10-11 lei), in a cardboard box and already in Romania. That is, for a guaranteed profitable export to the Romanian market, the purchase price for this product in the Republic of Moldova should not exceed USD 0.20-0.31/kg ( 4-6 lei). Meanwhile, in the Moldovan market, the wholesale purchase prices for the Golden Delicious apple have stabilised at an average level of USD 0.36/kg (7 lei/kg) since the end of November. Accordingly, traders see no point in exporting quality products at a lower price. In early December, Moldovan exporters send only small consignments of Idared, Florina, Red Chief and other apples to Romania.

Brazil

Data Analysis: The Price of Gala Apples in Brazil Rose 16% WoW Due to Tight Stocks

The wholesale price of fresh apple Gala variety in Brazil jumped 15.85% WoW to USD 0.95/kg in W1 of December 22. The upward price trend of Gala apple price came after a 36.92% WoW decrease in W4 of November to USD 0.82/kg. The situation in the Brazilian apple market is complicated. Despite the tight availability of domestic apples, prices decreased in W4 of November. One reason was lower demand due to happenings around the World Cup. The other significant factor is the more substantial presence of imported apples, mainly from Argentina. According to local insights, stocks of domestic Gala apples are almost zero. Expectations are that the demand will continue to go up until the end of the year, while imported quantities of Gala apples will dictate the tempo of prices.

Traditional Apple Stocks Are Coming to an End

W49 (12/05 to 09/12) was marked by reduced commercialization of traditional apples in the classifying regions. This is because the supply of these is extremely restricted, which at least supported prices for some profiles. The Gala 110 Cat 1 was sold at USD 24.61/18 kg box (R$ 131.00) in the average of the squares, a slight increase of 2%. The entry of apple eva into the market weighed negatively on quotations, even if still very restricted, but the supply of eva should intensify in the coming weeks. In addition, heavy rains disrupted the flow of some logistics routes in Santa Catarina and Paraná. For next week, national stocks of gala and fuji should be finalised, leaving only eva and imported apples on the market.

Argentina

Argentina and US Sign Updated Work Plan for Fruit Exports to the US

Authorities from Argentina and the US signed the updated work plan for fruit exports to the US during W48. The agreement enables the phytosanitary certification for the export of blueberries, cherries, pears, apples, peaches, and nectarines. Phytosanitary security was increased in bilateral trades by facilitating the entry of these products into the North American market. Argentina is among the top ten blueberry producers worldwide. As of 2022, Argentina produces more than 17,500MT of blueberries per year. In 2021, the United States was the main destination, with an estimated participation of around 60% of the total exported quantities. So far in 2022, exports amount to USD 7.8M, 73% higher compared to January to October 2021. With regards to cherries, in W48, 34% of exports in value correspond to the US, representing 49% of cherry exports in terms of quantities.

Portugal

Drought Caused a Shortage of Gala and Fuji Apples During the 2022 Campaign

The 2022 Portugal Gala apple campaign delivered approximately 25% fewer apples than in 2021 due to heat waves and drought, resulting in smaller calibres and less color. Due to this, suppliers are not interested in obtaining new markets or customers, as they need to fulfil current consumer demand and prioritise closer destinations to avoid quality problems that usually arise when longer transit times are observed, especially transit times longer than 25 days. Brazil is one of the main destinations for Portuguese apple producers located in the west production area, as they benefit from a shorter transit time of around 15 days. Brazilian buyers are currently buying smaller calibres in sizes 200 and above. Additionally, Fuji apple stocks are lower than usual due to the drought and heat waves, as well as because this is a late variety, despite the rainy season at the beginning of the campaign in September. Fuji apples experienced cracks around the peduncle area, causing them to have smaller yields than Galas due to the high rejection rate when packing.

Ukraine

Ukrainian Gardeners Did Not Wait for the Increase in Apple Prices

Despite all the expectations of Ukrainian producers, the surge in trading activity on the apple market in Ukraine, traditional for the pre-New Year period, did not occur, EastFruit project analysts report. As the gardeners themselves admit, in W48, selling prices for an apple began to decline rapidly. So, at the moment, Ukrainian gardeners are ready to ship apples at USD 0.23-0.34/kg (UAH 6-12/kg), which is on average 19% cheaper than at the end of the last working week.

Uzbekistan

Uzbekistan Dramatically Increased Imports of Apples in 2022

In the first 10 months of 2022, the volume of fruit imports into the country reached a record USD 90 million, which is 2.1 times higher than imports for the same period in 2021 and almost three times higher than imports in January-October 2020. According to the economist of the Investment Department of the Food and Agriculture Organization of the United Nations (FAO) Andriy Yarmak, such high growth rates of imports are explained, in part, by the ongoing liberalisation of Uzbekistan's international trade. In particular, recently, once again, the zero rate was extended for the import of citrus fruits and bananas, as well as a number of other products. Apple imports to Uzbekistan grew the most sharply around 4.6 times in value and 5.8 times in physical terms. For 10 months, importers spent USD 10.6 million on it, importing 25.3 thousand MT. Mandarin and orange in the ranking of the most “imported” fruits of Uzbekistan took the third and fourth places, respectively, and their imports doubled on average.

South Korea

Tasty Muju Apples and Grapes Are on the Table in Vietnam

Apples and grapes produced in Muju, North Jeolla Province, went on their first export to Vietnam on December 6. On this day, Muju-gun held a shipping ceremony for Vietnamese exports of apples and grapes at the Muju Nonghyup Eco-friendly Distribution Project Group in Anseong-myeon. The county plans to export 100MT of apples by May next year. Governor Hwang In-hong said, "Muju's apples and grapes are very popular with consumers because of their high sugar content and good quality."

Kazakhstan

Apple Losses in Kazakhstan Are Estimated at 100 Thousand MT

Apple production in Kazakhstan is 260 thousand MT while the consumption is about 350 thousand MT. About 90 thousand MT are imported and around 50 thousand MT of apples are laid for storage. The rest rot or become feed for livestock, APK Novosti reports. “A small part goes for processing, some is sold, the rest is used to feed livestock or rot. Losses are approximately 100 thousand MT and this is the non-repayment of loans, unreceived salaries, lack of funds for the maintenance of farms, unpaid taxes and social contributions, and, most importantly, could raise the well-being of those who live and work in the countryside, the most important task of the government and akims,” said B. Aliyev on his page in the social network. According to him, a record apple harvest will be recorded in Kazakhstan in 2022, but due to shortcomings, losses will be even greater than last year.

Egypt

Egypt’s Imports of Apples Fell to USD 30 Million in One Month

Egyptian imports of fresh apples recorded a noticeable decline in the recent period, as the total value of apple imports amounted to about USD 30,272,000 last September, while it was about USD 56,048,000 in September 2021, a decline of USD 25,776,000. Egyptian imports of apples during the month of March increased significantly, according to data from the Central Agency for Public Mobilization and Statistics, as Egyptian imports of fresh apples reached about USD 48,150,000, while they were 38,606,000 in March 2020, an increase. Its value amounted to 9,544,000.

Prices of Vegetables and Fruits

Prices of vegetables and fruit in the transit market registered an increase. Traders confirmed that the price of yellow apples was USD 0.81 (20 pounds) while the red apples ranged from USD 1.01 to USD 1.42 (25 pounds to 35 pounds). On the other hand, green apple prices ranged from USD 0.81 to USD 1.62 (20 to 40 pounds) and the American apples oscillated between USD 1.22 and USD 1.42 (30 and 35 pounds).