Lime Guide

The supply chain is as follows ; Farms -> Harvest -> Packinghouse/Selection -> Sales/Logistics

Farmers supply according to harvesting programs related to purchase orders. However, suppliers buy from other suppliers once or twice (very rarely) to meet the buyers' demand.

Suppliers export both directly and via traders or corporate firms. Big farms usually possess their own packing houses. There are around 3 renowned packing houses in Colima; the industry is not so saturated.

There is a kind of oligopoly in the supply chain, mostly to control processes and quality.

Agents do not play a big role, but they can be important in terms of easiness, volumes, invoices (fiscal procedures). Middlemen include only brokers and traders.

There is no association or network related to Persian Lime in Colima. Instead, suppliers determine prices according to the market situation. However, a network of suppliers in Apatzingan and Michoacan form strong bonds, determining the minimum and maximum sales prices.

The harvesting regions are Veracruz, Michoacan, Colima, Yucatan, Tamaulipas, and Oaxaca.

The lime season in Spain covers almost the entire year due to the different varieties that exist. However, the peak season for lime harvest in Spain, when supply intensifies, is from the fall until the beginning of the summer, between September and May.

The lime tree does not have a defined flowering period, and it can be said that if the weather conditions are favorable, it flowers throughout the year, and therefore the ripening of the fruit is staggered in a similar way. Having said this, it should be noted that in the Mediterranean climate, the greatest production occurs during autumn, winter, and spring, being much more limited in summer, given the dry climate and the lack of rainfall at this time.

The total area planted for limes in Spain is about 44.7 thousand MT (MAPA, 2020)

Murcia, Alicante, and Malaga jointly represent 94.1% of the total national lime output. 

 - 65% (9,400 ha) of the lemon plantations in the Region of Murcia have been planted after year 2000, rising to 68% in C. Valenciana (6,300 ha) and being 49% in Andalusia (1,600 ha).

Top destination countries are the US, the EU, Russia, and South Korea. All of these countries are considered as attractive markets to the suppliers, but the US is ideal as it is cheaper to export. Brazil is one of Mexico's competitors.

Rising demands are in countries such as the EU, Russia, and South Korea. 

Exported Value in 2022: USD 863.7 M  

 -9% YoY 

Exported Volume in 2022: 648 thousand MT

- 11.5% YoY 

The export value of Spanish limes has taken a downward trend since 2020, driven by a continuous decrease in domestic production, which has made Spain increase its imports.  

Source: ITC

In 2022, the main market for Spanish limes continues to be Germany with 37.6% of the share, following France with 19%, then the UK with 9.2%, and Poland with 5.7%.

The most commercialized lime varieties in Spain are:

Eureka: the fruit is medium in size, elliptical or ovoid in shape. It is a seedless variety with a lot of juice. Its cultivation is widespread throughout the world, although the United States is at the forefront in terms of production.

Lisbon: juicy, acid, and with a rough rind. The fruit is medium in size, elliptical or oblong. Seed content is variable but higher than Eureka. Harvesting is done during winter until early spring.

Primofiori: also called fino, its shape is spherical to oval. The rind of the fruits is thin and smooth and has a lot of juice and delicate acidity. It has a greater number of seeds than the Verna variety.

Verna: its shape is elongated, and the ends end in a point. It is almost seedless and has a relatively low level of acidity. It is one of the main varieties of European lemon produced in Spain and Italy.

International logistics is mostly managed by sea for lower costs, but air shipment is also available for urgent shipments. The main port is Manzanillo, and Guadalajara is the main site by air.

In terms of Sea logistics, the pro is lower costs and higher shipment volumes, and the con is that it is time-consuming. However, for the Air logistics, the pro is fast shipment and con is higher costs and smaller volumes,

Costs vary according to products, weights, number of bulks or pallets, volume, distance, port of origin, port of arrival, and chosen mode of logistics (sea, land, or air)

From less expensive to most expensive are as follows: sea, land, and air.

The cost from the warehouse to the delivery port is expensive for a lot of fresh produce in general. While the trucking fee to the port remains high, it becomes cheaper if the buyer hires a trucking company. Tecoman, Colima is the major producing region and not very far from the ports located in Manzanillo and Colima, only 2 hours away by a truck.

40 lb. cardboard boxes and 10 lb. cardboard boxes are the most common packages for the EU, South Korea, and Russia. For the US, Canada, and domestic markets, 20 kg in plastic crates are the most common packaging.

Reefer containers are used.

According to data from the United States Department of Agriculture global orange production has been relatively flat over the last six years. The three-year average for 2016-2018 is the same as the three-year average for 2019-2021 holding at 49.7 million metric tons (MMT). Supply volume has oscillated between 46 and 54 MMT over the time period. Production in the United States has been declining due to disease while China and Egypt have seen small increases. Other major regions Brazil, Mexico, EU, and South Africa have been relatively flat. Mexico and Brazil had a significant decrease last season due to weather. The following countries have seen increased exports based on the latest three-year averages: South Africa, Australia, Argentina, and Morocco.

Global Mandarin production has trended up over the last six years. The three-year average for 2016-2018 was 29.8 MMT while the average for 2019-2021 is projected at 32.3 MMT. Production for 2020-2021 is projected at 33 MMT with increases in all major regions. The following countries have seen increased exports based on the latest three-year averages: Turkey, China, South Africa, and Australia.

Global lemon and lime production has trended up over the last six years. The three-year average for 2016-2018 was 7.6 MMT while the 2019-2021 average is projected at 8.5 MMT. Increased production has been seen in all major regions except for Argentina which has projected a significant drop this season due to weather. The following countries have seen increased exports based on the latest three-year averages: Mexico, South Africa, EU, and Morocco.

Source: Foreign Agricultural Service/USDA 

Exporting process includes getting the Port of Origin (PO) ready according to the buyer’s needs in terms of volume, size, and quality, along with internal and external quality inspections and required documents.

Deals are mainly conducted in CFR and EXW. Sometimes, FOB is used.

Commercial Invoice, Quality Certificates, Bill of Lading, Certificate of Origin, Packing List, Exports Declaration, Goods’ and Container Insurance, Logistics Processes, and Customs Processes are required.

Burns, bruises, darkening, and spots must be identified in the beginning of processing. Upon delivery, there could also be temperature-related fungi in long travels, these are countered by ATM control and cold chain maintenance.

Depending on the importance of the issue and evidence shown, suppliers assume fair responsibility and negotiate solutions in order to solve accordingly and mostly to take care of long-term business relationships. Suppliers can adjust as necessary, which can be done as credit notes, price discounts, or preferential prices for next purchases.

The internal quality department performs quality checks by sampling their fruits based on color, size, and quality. Fruits then go to manual selection tables, where fruits are classified by size and quality. Afterward, external verification units perform random sampling on packages and boxes to review the quality, color, and absence of fungi. After such a quality assurance process, the packed pallets can be shipped.

Quality check on samples is also done by external verification units, such as government and licensed auditors, before shipments are loaded in containers, and the final departure of any shipment. Government-related certifications, such as SENASICA and NorMex, impose the external quality checks described above.

Third party inspections are mandatory for every exporting company. These inspections are stricter and more thorough for markets, such as the EU, South Korea, and Russia, compared to the markets in USA, Canada, and Japan. Producers pay for these external inspections.

Needs to be in compliance with quality regulations with local certificates, such as SENASICA and NorMex, with global ones such as HACCP, PrimusGFS, Global GAP, BRC, SMETA; and USDA, USDA Organic, and FDA Registration (for the US Market).

The global production of lime is projected to record a CAGR of 2.7% during the forecast period (2019-2024). Lime is used as an ingredient for the production of citric acid, lime oil, lime juice, and other products which are used in household food items, as well as chores. Therefore, the growing demand for the products will eventually increase the demand for lime and as a result, the growing interest in health benefits and cleaning applications will be a major force driving the market.

Source:

Lime Market