W44: Lemon and Lime Update

In W44 in the lemon and lime landscape, organic lemon production in North America's primary fall-supplying regions, Mexico and California, has declined in 2023. Mexico's lemon production is expected to drop by 30 to 35% year-on-year (YoY). In Mexico, financing problems and water scarcity have reduced lemon supplies, with growers facing drought for 18 to 24 months. Mexican banks are hesitant to lend money to growers, making it challenging to invest in orchards, resulting in declining lemon production. The water shortage is causing smaller lemon sizes and reducing quality.

In addition, California is also grappling with reduced harvest due to climate change, resulting in an estimated 30% decrease YoY. Lemon demand remains consistent, with high demand during the summer and holidays. However, low fruit availability has led to high lemon prices. The situation is expected to improve as District One increases its production, which will help stabilize the market. Approximately two months ago, imported lemons from Argentina were available at more competitive prices, highlighting the notable price difference in the current market.

Peruvian lemon and onion market prices in Lima have dropped to USD 0.27 per kilogram (PEN 1/kg) due to the El Niño phenomenon and unfulfilled government promises. The lemon price has surged recently, reaching USD 2.66/kg (PEN 10/kg). However, merchants in San Juan de Lurigancho (SJL) believe this may be a new trend and expect it to remain stable in the coming days.

In the 2023/24 season, Spanish lemon production in Andalusia is projected to rise by 28.1%. The majority of lemon production, about 95%, will come from Málaga and Almería. Almería is expected to be the third-largest citrus-producing province in Andalusia, contributing to 11.6% of the total production. Compared to the previous campaign, the 2023/24 harvest is anticipated to be 25.4% higher. Specifically, sweet orange and mandarin production will increase by 24.1% and 30.7%, respectively, while lemon production will increase by 23.8%.

In Nepal, lemon producers in the Syangja District are encountering market difficulties in the current season despite having experienced favorable yields in the previous year. The 2022/23 season witnessed ample lemon supplies, but the current season presents a more challenging landscape. Some lemon farmers had substantially expanded their cultivation area in response to prior successes, with their produce fetching prices ranging from USD 0.98 to 1.13 per kg (NPR 130 to 150/kg). However, the 2023/24 season has seen low market demand, impacting their anticipated revenues, which were expected to reach USD 1.2 thousand (NPR 1.2 million). Furthermore, the absence of a local storage facility exacerbates the challenges lemon farmers face within the district.

Lastly, Indian lemon prices in the Nellore and Tirupati districts have dropped below USD 0.24/kg (INR 20/kg) in wholesale markets, down from an all-time high of USD 1.92/kg (INR 160/kg). The sharp decline is due to unfavorable weather conditions and excessive production, affecting about 75 thousand farmers who rely on borewells for irrigation in the dryland areas of the region.