W29: Lemon and Lime Update

In W29 in the lemon and lime landscape, the Interprofessional Lemon and Grapefruit Association (Ailimpo) reports a 20% year-over-year (YoY) decrease in Spain’s lemon production due to adverse weather and increased energy costs which affect the harvest and yield per hectare (ha). The Ministry of Agriculture, Fisheries, and Food reported that from Sep-22 to Apr-23, Spanish lemon exports have declined, with 442.3 thousand metric tons (mt) of lemons exported. However, despite the decrease in export volume, the value of lemon exports showed an increasing trend. Lemon exports generated USD 610.7 million (EUR 551.1 million), representing a 5.5% increase compared to 2021/22 and a significant 6.1% increase from the average export value. In addition, Ailimpo estimates a 30% increase in Fino lemon harvest for the 2023/24 campaign, reaching 990 thousand mt in Spain, compared to the previous 2022/23 production. Spain will continue to be the leading exporter of fresh lemon in 2023/24, with the second largest lemon processor globally. However, hail damage occurred on May-23 due to abundant rainfall, affecting 1 thousand ha in various regions of the Region of Murcia.

In Q1-23, Italian fruit and vegetable exports experienced a significant 58% increase in value and a 134% increase in volume YoY. Lemons were the key growth drivers, with the verdello variety selling for around USD 2.2/kg, the primo fiore variety at USD 1-1.1/kg, and Bianchetto at USD 1.7-1.8/kg. Italy's lemon export remains significant, with Germany and France being significant markets. Also, Poland is becoming an essential market for Italian citrus fruits, particularly lemons. Production costs have decreased since 2022, but the main challenge is the Mal secco disease, which has caused significant damage to citrus orchards. Lemon has become a leading export for Brazil in 2023, with approximately 89 thousand mt of fruit already shipped to the international market. Notably, the Chilean market has recently imported the Brazilian Tahiti lemon and successful negotiations have allowed for its entry.

The supply of Tahiti limes has significantly decreased in São Paulo, Brazil, causing the selling prices in the market to increase. The average price for Jul-23 (until the 20th) is USD 6.90/box (BRL 32.61/box), a 74.85% month-on-month (MoM) increase and a 103.3% YoY increase. The limited supply is expected to continue throughout Jul-23 but may decline further in Aug-23, which leads to even higher prices. European buyers are increasing payments to Brazilian producers, driven by the high demand in summer and the low lemon supply in Mexico. This supports the increasing selling prices of Tahiti limes, as Brazil's main competitor struggles to meet high demand.