W43: Weekly Apple Update
Global
Apple Market in Most Countries Stagnated With Some Prices Moving Upwards
The apple market in most of the countries monitored by the project was in a state of stagnation. Nevertheless, some of its players this week still managed to revise the prices for apples upwards. Moreover, some varieties in certain markets managed to rise in price by 40% and even one and a half times in just a week. In Uzbekistan, sales of apples began already from cold stores, and, due to such a seasonal reduction in supply, prices went up. The lowest price level in the Uzbek market was recorded in the segment of apples "Renet Simirenko" ($0.54/kg), and the most expensive variety was "Gala" ($0.90/kg). In addition, the depreciation of the national currency also contributed to the growth in prices for the Gala apple in Uzbekistan, since it was in the segment of this apple that a significant share of imported products was recorded.
As for Moldova, the price growth was also facilitated by the start of sales of fruit from cold stores. Moreover, farmers also noted an increase in demand from exporters focused on the supply of apples to Romania, although it concerned mainly the segment of high-quality Gala apples. As a result, the average price for these apples rose to $0.36/kg, while, for example, the Golden Delicious variety less popular with such buyers was offered at $0.31/kg. We also note that, despite a significant increase in prices, Renet Simirenko apples were still offered much cheaper in Moldova: an average of $0.21/kg.
Europe
European Apples Ripe for the Middle East Market Following Successful Harvest
According to the report, European apple production in 2022 is expected to exceed 12MMT, while French apple production is expected to be around 1.35MMT, putting the harvest on par with 2020 and 2021 despite the challenging conditions faced during one of Europe's hottest summers on record. There will be a variety of well-known apple varieties available, including the Golden Delicious, which remains the most produced apple in France, the Gala, the Pink Lady, the Granny Smith, the Red delicious apple, and the Juliet.
Lower Apple Exports to Egypt Are Important for the Entire EU
The EU exported fewer apples in August and September than it did at the same time in 2021. The main cause is trading difficulties with Belarus and Egypt, which resulted in lower apple exports from the EU to Egypt. As a result, exports decreased by 15% YoY. In Europe, there is also about 1/3 less apple import observed, which is due to the aftermath of expensive sea freight from Chile, South Africa, and New Zealand. As a result, there is less demand for imported apples; however, it is good news for Polish fruit growers because local apples have more "space" on the market.
Italy
Four Kilos of Apples for a Coffee in Italy
In 2021, Italian growers were forced to accept a price for four kilos of apples that only cost a cup of coffee. Producers received less than the production costs for almost all of the varieties harvested in 2021, averaging 0.39 euros/kg. Not to mention that the liquidations arrived between April and September of 2022, nearly a year after the harvest, which is a significant delay that is repeated every year. Fruit growers collect the crumbs, that is, the little that remains, while also paying for all the inefficiencies and errors of those downstream in the supply chain. The major worry is that apples will be paid even less at the end of the 2022 campaign.
United States
Apple Association’s Statement on USTR Rejection of 301 Investigation
The U.S. apple industry is relieved by the U.S. Trade Representative’s decision to reject the 301 Investigation on imported fruits and vegetables from Mexico. A Section 301 investigation could have been followed by tariffs on imported produce and, in turn, retaliatory tariffs from Mexico. That has happened in the past where U.S. apples were the targets of retaliation. We acknowledge that other sectors of the fresh produce industry are facing their own difficult challenges, but the U.S. Trade Representative came to the correct conclusion, and we are thankful.
USApple joined other groups in a letter to Ambassador Katherine Tai strongly opposing any Section 301 investigation of fresh produce imports from Mexico. The inflationary impacts of fuel, fertilizer and labor costs have created strong headwinds for apple growers. An investigation and pressure for relief in the form of tariffs would have, once again, painted a big target on U.S. apple growers in a battle where we’re innocent bystanders. We’ve been through that before and it was very painful. Mexico has long been the number one market for exports of U.S. apples, and that market is growing quickly. Our exports to Mexico in 2021 totaled $349 million, up 45 percent from $241 million in 2020. Many of the 150,000 jobs supported by the apple industry would be put at risk by U.S. action that invites retaliation.
South Africa
Apple Exports to China Offer South Africa a Welcome Addition to Poor Pear Sales in Europe
As of this year, South Africa is the second largest apple supplier to China, which is increasingly looking for apple imports. This year's South African export to China (99% red apples and a little bit of Golden Delicious) is nearing its end. The lucrative period around the Chinese Moon Festival fell neatly into the export season. South Africa has only been exporting apples to China for eight years and trade is generally on the rise, with triple-digit growth almost every year. From 2018 to 2019, the increase was 291%. After an abnormal 2020 when exports fell by 39%, there was a recovery and this year 1,090,612 cartons of 12.5 kg were shipped. In the first year that Fuji apples were shipped, the volumes were almost symbolic: 3,500 cartons. But last year more than 728,000 cartons were exported, which is two-thirds of South African apple exports to China. Royal Gala apples are approaching 300,000 cartons and in the third year that the South African Gala mutation Bigbucks was shipped to China, this variety is already in third place (64,000 cartons).
Poland
The Polish apple harvest is currently in full swing, with high demand. Workers will soon be transferred from the fields to the packaging departments, and production facilities will be fully operational. Polish apple prices are still too low to cover all the producers' production costs. However, it is expected to rise in the coming weeks. Profitability is becoming increasingly difficult as customer requirements become more complex.
Turkey
Apple Saplings Grown in Niğde Are Sold to Turkey, Kazakhstan, Turkmenistan and Uzbekistan.
Niğde, which is second in apple production in Turkey, meets more than 10 percent of the country's needs with the production of more than 2 million certified apple saplings. Apple saplings grown in Niğde are sold to Turkey, Kazakhstan, Turkmenistan and Uzbekistan. Niğde Apple Producers Association President Atilla Kaplan, said that Niğde ranked second with 552 thousand tons of apple production last year and that they expect the same production figures this year. Niğde ranks first with the number of trees planted with 11 million. "There is an apple production area of approximately 250 thousand decares and this continues to increase."
Moldova
Apple Price Increase in Moldova at the End of October
In the last ten days of October, wholesale prices for some varieties of apples, especially red ones, increased by an average of 15-20% on the Moldovan market. In particular, Gala rose in price by 1 lei/kg, to an average of 7 lei/kg ($0.36/kg).
Moldovan major companies believe that apples could be competitive in the Romanian market even though their current price level at USD 0.31/kg is almost double that of Polish apples versus USD 0.18/kg . The main reason for this seemingly paradoxical statement is that the routes from many Moldovan fruit shops to some distribution centres of Romanian wholesalers are significantly shorter than those from Poland to Romania. Therefore, Moldovan apples can be sold in Romanian supermarkets in the same price range as Polish apples if the Moldovan exporters agree to road haulier rates that are at least EUR 0.12-0.15/kg lower than the rates for the transport of Polish apples. Participants in the Moldovan fruit market, however, claim that this assumption is only valid for Gala red varieties.
The Autumn Season of Apple Processing in Moldova Will Last Longer Than Predicted
Rising electricity prices have forced Moldovan apple farmers to avoid storing a significant portion of their produce. Some apples are therefore sent for industrial processing. Taking this into account, concentrate production factories adjust the deadlines for the end of the autumn season on a weekly basis. Previously, factories were believed to meet the deadline by the end of the first week of November given the low apple harvest. However, due to the high apple supply currently, the season is expected to last 2-3 weeks longer.
Brazil
Sales of Apples in Brazil Are Satisfactory Despite the End of the Month
The end of the month arrived and national apple sales were even satisfactory in the classification regions. This is because, according to employees of Hortifruti/Cepea, stocks are almost depleted, which ensured a good flow. It is worth remembering that, due to the “break” in the harvest, classifiers chose to store fruits with the strategy of offering them in periods of scarcity, when they were able to obtain high prices. This week (24 to 28/10), the Fuji 165 Cat 1 3 was sold at R$ 94.88/cx of 18 Kg in the average of the regions, a slight increase of 4% compared to the previous period. It is expected that, for the next few weeks, the market will follow this rhythm, until mid-December, when the early apples should arrive, increasing the availability in the market a little.
Germany
In Germany, Picking Apples Is Not Profitable
As a result of high costs and limited demand, picking apples is currently unprofitable in Germany. In this season, the cost of producing a kilogramme of apples was calculated at USD 0.60/kg in Germany. However, offers from retailers in W43 currently stand at USD 0.40/kg, while wholesale prices are even lower. German farmers are also conscious of labour expenses because the minimum wage has just risen to USD 12.04/hour. Additionally, the cost of storing apples post-harvest has tripled due to electricity prices. Therefore, fruit growers in the lower Elbe region have so come to the conclusion that harvesting each kilogramme of apples today is a waste of money.
Australia
The Burgundy Apple Soluna Will Be Officially Presented by the Australians in Early November
In Western Australia, an international trademark has been registered for a local variety of apples with burgundy skin Bravo. In international markets, this apple will be marketed under the brand name Soluna - representing the moon and the sun, reflecting the apple's dark skin and creamy, but crisp, white flesh. The new Soluna brand will be officially launched at Asia Fruit Logistica in Bangkok on November 2-4, giving importers, wholesalers and retailers from all over the world the opportunity to learn more about the apple.
“The international commercialization of this variety is a natural next step for this Western Australian-bred apple, bred by the late John Cripps and sharing the same pedigree as the iconic Pink Lady apple,” says Alannah MacTiernan, Western Australian Secretary of Agriculture and Food. She added that Western Australian producers are well positioned to capitalize on international trade. According to the minister, international demand for Bravo apples continues to grow, with exports to Hong Kong, Indonesia, Singapore, Thailand, Malaysia and the UAE up 450% this year.
Ireland
Local Apples and Pears Hit Tesco for the First Time in Years
This fall and winter in 2022, 3.5 million local apples and pears will be available at Tesco. Ireland imports approximately 95% of its apples, with many coming from as far away as Chile and New Zealand. However, as the climate changes and consumers recognise the importance of sustainable development, more buyers are looking for locally grown fruits. Therefore, Irish growers started producing local Gala and Golden Delicious apples apart from the traditional varieties to supply commercially in the supermarkets.
