California Fruit and Vegetable

Tag: FAS

  • American Olive Oil Producers Association Selected for $2M Study of U.S. Olive Oil

    The American Olive Oil Producers Association (AOOPA) was selected to receive $2 million cooperative agreement by the United States Department of Agriculture (USDA) Foreign Agricultural Service (FAS) under the Assisting Specialty Crop Exports (ASCE) Initiative to conduct a four-year study of olive oil produced throughout the United States. The ASCE initiative is an innovative program that provides an opportunity for USDA to partner with U.S. specialty crop producers, such as American olive oil producers, to address non-tariff trade barriers in overseas markets.

    “We are grateful to the Trump Administration under the leadership of USDA Secretary Brooke Rollins to significantly advance efforts to eliminate non-tariff trade barriers for American producers and support the highest quality standards for extra virgin olive oil consumers,”said Kimberly Houlding, President and CEO of the American Olive Oil Producers Association. “We believe consumers deserve to receive all the health benefits of extra virgin olive oil, and that starts with quality standards and a “Best if Used By” date on the bottle that based on science.”

    This funding enables AOOPA, in partnership the University of California, Davis; University of Georgia; and Modern Olives laboratory (three global experts in the collection, testing, and compilation of crop data), the unprecedented opportunity to collaborate, test,and compile olive oil data from the seven (7) olive oil producing states across the United States.

    This effort will answer the call by the Codex Alimentarius Committee for Fats and Oils (CCFO) for data on key quality parameters, pyropheophytin (PPP) and 1,2-diglycerides (DAGs), which are indicators of the age and shelf-life of extra virgin olive oil, for potential inclusion in the CCFO international food standard; provide a better understanding of the natural variations in the chemistry of olive oil produced in different regions of the United States that aren’t currently recognized in international standards;and equip American farmers with important data and scientific analysis of the olive oil they produce

  • Despite Production Challenges, Egypt to Continue as World’s Largest Fresh Orange Exporter

    The USDA Foreign Agricultural Service (FAS) in Cairo anticipates Egypt to maintain its position as the number one orange exporter in MY 2021/22 despite production challenges. In marketing year (MY) 2021/22, FAS Cairo forecasts fresh orange exports to reach 1.45 million metric tons (MMT) down from 1.67 MMT in MY 2020/21. Post attributes the decrease in exports to lower production amid unfavorable climate conditions. Russia, Saudi Arabia, Netherlands, India, Bangladesh, United Arab Emirates, China, United Kingdom, Ukraine, and Oman are likely to remain Egypt’s top ten export destinations for fresh oranges. 

    Planted Area:

    In MY 2021/22, FAS Cairo forecasts total planted area in oranges at 168,000 hectares (ha), similar to the previous marketing year. MY 2020/21 planted area at 168,000 ha remains unchanged from the USDA official estimate. Most of the area planted with oranges is located in desert reclaimed lands which account for 70 percent of the total area. Plantations in the Nile Delta region account for 30 percent of the total orange planted area.

    Post estimates MY 2021/22 total harvested area at 135,000 ha, a 6.9 percent decrease from last year. The decrease in area harvested is attributed to an approximately 7.2 percent decrease in the number of bearing trees from the previous year due to unfavorable weather conditions during flowering time that negatively impacted fruit set, and hence the harvest as a result.

    Production:

    In MY 2021/22, FAS Cairo forecasts orange production to decrease by almost 16 percent, or 570,000 MT to 3 MMT. The decrease in production is attributed to severe weather conditions and fluctuating temperatures during flowering of the trees which impacted fruit set and production. Orange production in the Nile Delta was also impacted by a 25-30 percent increase in fertilizer prices due to higher costs of production and larger exports by the fertilizer industry to capture higher prices in the global market. Typical land ownership in the Nile Delta is an acre or less.

    Post is also revising the MY 2020/21 estimate upwards by 170,000 MT to 3.57 MMT from the USDA official projection of 3.4 MMT. We attribute the increase in production to higher yields and favorable weather conditions last season during the flowering time that positively impacted fruit set and hence the production as a result.

    Most of Egypt’s orange production come from commercial farms on reclaimed desert land established during the last three decades, rather than the Nile Valley where land ownership is fragmented and farmers cannot afford the necessary level of investment for sustainable orange production. Despite these challenges, replacing old orchards with newer trees, improving on-farm irrigation techniques, adopting up-to date nutrient management programs, and reducing post-harvest losses are ongoing efforts by growers associations and the government.

    Orange is the major citrus crop in Egypt, representing about 80 percent of the total cultivated citrus area. Egypt’s main orange varieties include the following:

    Washington Navel Orange: Washington Navel is the key cultivar navel orange grown in Egypt and the best-known naval orange being exported. There are other lesser known navel orange cultivars such as Navelate, Cara Cara, New Hall, Navelina, Fisher, Leng, Fukumoto and Lane late. Fruit color break starts in late September and ripening fruit dates extend from November to March. The fruit is seedless, medium to large-sized, with relatively rough skin in some cultivar and soft skin in others. It has a sweet flavor with a fruit taste. The rind is orange with dark pulp.

    Valencia Orange: Valencia ranks second after Navel oranges as far as area cultivated. Nubaria district is considered the largest production area for Valencia oranges in Egypt. Valencias have a long ripening season from March to July. The fruit pulp is juicy and it is medium to large-sized with a round to oval shape. The skin is soft and easily peeled, the seeds are small, and the rind and flesh are orange.

    Other Varieties: There are other orange varieties like Baladi orange, Blood orange, Khalily orange, Yafawy oranges and Sweet orange. Cultivated areas of these varieties are small compared to Navel and Valencia orange, and they’re mainly consumed fresh or as juice.

    Consumption:

    In MY 2021/22, FAS Cairo forecasts that fresh oranges domestic consumption will decrease by 19.3 percent to reach 1.25 MMT. Decrease in local consumption is attributed to lower production and more growers directing their produce towards exports as worldwide orange demand is on the rise. Globally, consumers have increased their utilization of fresh oranges amid the COVID-19 pandemic due to its high vitamin C content.

    In MY 2021/22, utilization of oranges by the processing sector is forecast to decrease by approximately 14.3 percent from the previous marketing year as a result of the anticipated lower fresh orange production and higher costs of the processing sector production and transportation which is reflected in consumer prices. MY 2020/21 fresh domestic consumption and processing estimates remains unchanged from the USDA official estimate.

    Trade:

    In MY 2021/22, FAS Cairo forecasts orange exports to decrease by approximately 13.2 percent to reach 1.45 MMT. We attribute this decrease to anticipated lower production which will affect the export volume. FAS Cairo anticipates Egypt to maintain its position as the number one orange exporter in MY 2021/22, despite production challenges due to severe climate conditions.

    Post is revising upward the estimates of fresh orange exports in MY 2020/21 to 1.67 MMT from the USDA official estimate of 1.5 MMT.

    Post attributes this increase in exports to higher production, more growers linked to international markets and a rise in global prices amid increased consumer demand.

    The majority of orange exporters are producers and own packing facilities that are approved for export by the government. They also buy from local farmers if their production is not sufficient to meet their export obligations. Other exporters own packing facilities but do not produce oranges, and thus rely on local farmers. In these cases, the exporters are responsible for transporting the crop to their packing facilities.

    The Central Administration for Plant Quarantine (CAPQ) of the Ministry of Agriculture and Land Reclamation (MALR) and the Agricultural Export Council (AEC) have agreed to start the orange export season on December 15, 2021 for the MY 2021/22. The export season for oranges usually starts with shipments to the Arabian Gulf followed by Russia, Ukraine, and then to the European Union and East Asia.

    In MY 2020/21, Egyptian orange exports reached 111 countries compared to 104 countries in MY 2019/20 with Russia, Saudi Arabia, Netherlands, India, Bangladesh, United Arab Emirates, China, United Kingdom, Ukraine, and Oman as Egypt’s top ten export destinations for oranges. Post expects that the top ten export destinations in MY 2021/22 will remain unchanged from MY 2020/21 (Figure 1).

    Figure 1: Top Ten Markets for Egypt’s Fresh Orange Exports

    Successful joint efforts by the Egyptian government and the private sector to open new markets such as New Zealand, Brazil, and Japan and other markets over the last few years – will increase orange exports. These joint efforts have also contributed to the application of a modernized tracking systems for oranges exports during the stages of cultivation, production, packaging and export.

    The success of Egypt’s export policy in opening new markets and establishing a traceability system have contributed to Egypt being the top orange exporter in the world during the past 5 years with a total volume of 8.32 MMT. All of these developments support a positive outlook for Egyptian orange exports as well as encouraging agribusinesses to invest in establishing new facilities or expanding capacity.

    Egypt’s exports of fresh oranges to its top ten destinations in MY 2020/21 amounted to 1.27 MMT compared to 1.06 MMT in MY 2019/20, an increase of almost 20.5 percent. In MY 2020/21, Egypt’s fresh orange exports to the top ten destinations constituted 75 percent of total exports compared to 77 percent of total exports in MY 2019/20.

    Metric Tons

    This drop is due to a smaller overall export volume in MY 2019/20 (1.37 MMT) compared to 1.67 MMT of fresh orange exports in MY 2020/21. It is also reflected in higher export volumes to key markets as well as exploring new export ones.

    In MY 2020/21, the most significant increase in Egypt’s fresh orange exports were to India with a more than threefold increase compared to the previous marketing year due to higher demand by Indian consumers amid the COVID-19 pandemic. Exports to Bangladesh have also increased a great deal, by 75 percent. Exports to Russia increased by 15 percent and Egyptian orange exports to Saudi Arabia have also increased, by 6 percent. Exports to the Netherlands increased by 11 percent in MY 2020/21 compared to MY 2019/20.

    In contrast, Egyptian orange exports to the Chinese market dropped by roughly 32 percent in MY 2020/21 compared to the previous marketing year due to inflated freight prices.

    Marketing:

    Russia: Turkey and South Africa are Egypt’s main competitors in the Russian market. However, Egypt’s total exports to Russia in CY 2021 (Jan-Sep) was at 238,560 MT exceeding both origins by a wide margin – South Africa at 36,929 MT and Turkey shipped 34,822 MT. Egypt’s total exports to Russia in CY 2020 was at 211,113 MT, also exceeding both origins by a wide margin – Turkey at 112,353 MT and South Africa shipped 77,045 MT. (Source: Trade Data Monitor, LLC)

    Saudi Arabia: Egypt’s main competitors in the Saudi Arabian market are traditionally South Africa, Spain, and Lebanon. In CY 2021 (Jan-Sep), Egypt’s exports of fresh oranges to the Saudi Arabian market amounted to 245,569 MT exceeding the three origins by wide margins. South African exports amounted to 61,740 MT, Spain’s exports at 10,788 MT, followed by Lebanese fresh orange exports at 8,380 MT. In CY 2020, Egypt was also the leading exporter to Saudi Arabia with a total of 254,486 MT versus 89,373 MT exported by South Africa. followed by Lebanon at 24,358 MT, and Spain at 15,348 MT. (Source: Trade Data Monitor, LLC)

    EU- 28: Egypt’s main competitors in the European Union are South Africa and Morocco. In CY 2020, South Africa exported 453,745 MT versus 211,697 MT exported by Egypt followed by Morocco at 74,864 MT. In CY 2021 (Jan-Aug), Egypt’s exports of fresh oranges to the European Union have increased by 22 percent compared to the same period in CY 2020 amounting to 308,384 MT, and exceeding South Africa which shipped 158,932 followed by Morocco at 45,454 MT. (Source: Trade Data Monitor, LLC)

    India: South Africa is Egypt’s competitor in this market. In CY 2020, Egyptian exports amounted to 26,665 MT while South Africa supplied 11,000 MT to the Indian Market. In CY 2021 (Jan-Sep), Egypt’s exports of fresh oranges to India amounted to 126,271 MT exceeding the South African origin by wide margins. In CY 2021 (Jan-Sep), South Africa shipped only 12,179 MT to India. (Source: Trade Data Monitor, LLC).

    Bangladesh: Egypt’s main competitor in the Bangladeshi market are mainly India and South Africa. In CY 2021 (Jan-Sep), Egypt’s exports of fresh oranges to Bangladesh amounted to 107,000 MT, India at 62,531 MT and South African exports amounted to 40,127 MT. In CY 2020, India was the leading

    exporter to Bangladesh with a total of 127,914 MT versus 66,000 MT exported by South Africa and another 66,000 MT exported by Egypt. (Source: Trade Data Monitor, LLC)

    China: South Africa is Egypt’s main competitor in this market. In CY 2020, Egyptian exports to the Chinese market amounted to 112,373 MT while South Africa supplied 105,000 MT. In CY 2021 (Jan- Sep), Egypt’s exports of fresh oranges to the Chinese market amounted to 86,130 MT, and South African exports amounted to 66,861 MT. (Source: Trade Data Monitor, LLC)

    United Arab Emirates: In CY 2020, South Africa exported 89,527 MT versus 138,611 MT exported by Egypt. In CY 2021 (Jan-Aug), Egypt’s exports of fresh oranges to the UAE market amounted to 49,432 MT, and South African exports amounted to 76,420 MT (Source: Trade Data Monitor, LLC).

    United Kingdom: Egypt’s competitors in the UK market are mainly Spain and South Africa. In CY 2021 (Jan-Sep), Egypt’s exports of fresh oranges to the United Kingdom amounted to 64,000 MT, Spain at 66,000 MT, and South African exports amounted to 45,386 MT. In CY 2020, Spain was the leading exporter to the United Kingdom with a total of 93,500 MT versus 67,800 MT exported by South Africa, followed by Egypt which shipped 55,217 MT to the UK market. (Source: Trade Data Monitor, LLC)

    Ukraine: In CY 2020, Egyptian exports to Ukraine amounted to 41,600 MT while Turkey supplied 30,639 MT. In CY 2021 (Jan-Sep), Egypt’s exports of fresh oranges to the Ukrainian market amounted to 48,192 MT and Turkish exports amounted to 5,291 MT, a 70 percent decline compared to the same period in CY 2020. (Source: Trade Data Monitor, LLC)

    Oman: In CY 2020, Egypt exported 35,770 MT to Oman versus 13,171 MT exported by South Africa. In CY 2021 (Jan-Sep), Egypt’s exports of fresh oranges to Oman amounted to 35,000 MT, and South African exports amounted to 10,000 MT (Source: Trade Data Monitor, LLC). — By Ahmed Wally, USDA Foreign Agricultural Service

  • Challenges for the Japanese Citrus Market

    Japan’s mandarin production continues to decline amidst labor shortages and reduced consumption. Shipping challenges and rising prices are projected to reduce the consumption of largely imported oranges and grapefruit. FAS/Tokyo anticipates that the resumption of hotel and restaurant operations following 2020-2021 COVID-19-related states of emergency will support the recovery of the Japanese demand for fresh lemons.

    Production

    Japan’s domestic tangerine/mandarin production primarily focuses on Satsuma mandarins, also known as “Unshu mikan” or “Unshu orange” (referred to as “unshu” hereafter). After reaching peak production of 3.7 million metric tons (MT) and a corresponding price drop in 1975, Japan’s unshu production has been steadily declining in line with production plans by Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF). In response, some citrus farmers have transitioned to producing non-unshu varieties (e.g., Natsu-Mikan (Citrus natsudaidai) and Iyokan (Citrus Iyo)). Although this transition had partially offset falling unshu production, non-unshu production has also been declining since 1987 due to the overarching challenge in Japanese agriculture of aging farmers and a lack of successors.

    In marketing year (MY: October – September) 2021/22, FAS/Tokyo forecasts area harvested for tangerines/mandarins in Japan will shrink by 1,300 hectares (ha) to 50,400 ha from MY 2020/21. The unshu varieties will represent approximately 80 percent of Japan’s total tangerine/mandarin production, and the remainder will be non-unshu varieties.

    Japan’s tangerine/mandarin season runs generally between October and May, where unshu production occurs primarily between October to February, followed by non-unshu varieties. According to MAFF statistics, five western prefectures (Wakayama, Ehime, Shizuoka, Kumamoto, and Nagasaki) produce nearly 70 percent of Japan’s unshu. These five prefectures are also major producers of non-unshu varieties. Until MY 2019/20, MAFF had set an “appropriate production/distribution quantity” target to control production, but recent unshu production fell short of the targets. Therefore, MAFF decided to shift away from government-driven production control. For MY 2021/22, MAFF announced a tangerine/mandarin demand estimate in an effort to balance production with market demand. 

    MAFF’s MY 2021/22 demand estimate for unshu is 760,000 MT, 6,000 MT down from MY 2020/21. However, based on industry sources, FAS/Tokyo forecasts Japan’s MY 2021/22 production will fall short of meeting that demand. According to Wakayama unshu farmers, MY 2021/22 will be an “off– year” for the alternatively bearing unshu in Wakayama and Shizuoka prefectures. Furthermore, long rains in May and August negatively impacted production due to increased incidence of Botrytis cinerea and citrus black spot disease. FAS/Tokyo forecasts MY 2021/22 tangerine/mandarin production at 924,000 MT, down 5.3 percent from MY 2020/21 level, of which 720,000 MT will be unshu.

    Consumption

    Approximately 90 percent of domestically produced tangerines/mandarins are consumed fresh in Japan. The remainder is processed, mostly for juice. According to surveys carried out by the Japan Fruit Association (JFA) and the Japan Co-operative Alliance (JCA), price is increasingly the key consideration for Japanese consumers in purchasing fresh fruit. For example, the 2020 JFA survey found that approximately 55 percent of Japanese consumers eat fresh fruit less than once a week due to cost. Although at-home food consumption, where tangerines/mandarins are typically eaten, has increased during the COVID-19 pandemic, this trend has not led to an increase in fresh fruit consumption. Consequently and in light of the expected decline in domestic tangerine/mandarin production, FAS/Tokyo forecasts Japan’s total tangerine/mandarin consumption will decrease by 5.0 percent from MY 2020/21 to 949,000 MT in MY 2021/22.

    Imports

    In MY 2020/21, Japan’s imports of fresh tangerines/mandarins rose by 9.9 percent to 23,103 MT, primarily due to summer tangerine imports from Peru (Table 1), which gained market access to Japan for tangerines/mandarins in 2018. Although Peruvian tangerines are typically more price-competitive than U.S. or Australian products, there is minimal overlap or direct competition in the Japanese market between tangerine/mandarin imports from the United States and southern hemisphere. Nevertheless, despite remaining the top fresh tangerine/mandarin supplier to Japan, the U.S. import share has been declining in the last few years due to changing production patterns and export priorities in the United States, as well as increasing price (Table 1).

    FAS/Japan forecasts Japan’s imports of tangerines/mandarins to increase to 25,000 MT in MY 2021/22 or by 8.2 percent from MY 2020/21 levels, largely due to growing consumption in the summer months driven by the availability of Australian and Peruvian products.

    Exports

    Despite COVID-19-related restrictions on travel and promotional activities, Japan’s fresh tangerine/mandarin exports increased to 1,416 MT or by 34.4 percent from MY 2019/20 to MY 2020/21 largely due to greater demand from established customers in Hong Kong. Given the Government of Japan’s focus on boosting agricultural exports, including unshu (see JA2021-0103 titled “Japan Releases Details on Agricultural Export Expansion Plan”), FAS/Tokyo forecasts MY 2021/22 Japan’s tangerine/mandarin exports will grow to 1,800 MT or by 27 percent from MY 2020/21 levels.

    Policy

    U.S. tangerine/mandarin exports (Harmonized System Code (HS) 0805.21, clementines (HS 0805.22) and similar varieties (HS 0805.29)) continue to face a tariff disadvantage compared to tangerines/mandarins from member countries, including Australia and Peru, of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). The import tariff rate for CPTPP tangerines/mandarins is 5.6 percent, while U.S. products face a 17 percent tariff. Read the full report from the USDA Foreign Agricultural Service HERE.

  • Costa Rican Orange Production and Exports Expected to Rebound in 2022 Despite Battle with HLB

    After overcoming COVID-related labor and supply chain disruptions, Costa Rica’s orange production is expected to rebound to 300,000 metric tons in 2022, pushing total orange juice exports slightly higher to 33,000 metric tons. Despite some success in mitigating the worst impacts of citrus greening, the disease is expected to limit near-term prospects for Costa Rican industry growth.

    Commercial orange production is concentrated in the northern part of Alajuela province (around Los Chiles, Guatuso, and Upala) and in the northern part of Guanacaste province (near the border with Nicaragua in an area known as Santa Cecilia).

    Figure 1. Map of Costa Rican Growing Area (highlighted in red)

    Two companies, TicoFrut and Del Oro, control most of the production and practically all processing of oranges in the country. TicoFrut is the largest company in the sector. TicoFrut’s plantations are located primarily in the province of Alajuela (near the border with Nicaragua) and in Nicaragua. Oranges from the Nicaraguan plantations are trucked across the border in Los Chiles for processing at TicoFrut’s plant located in Muelle, San Carlos, about 50 miles to the south of the border. Del Oro’s plantations are in the province of Guanacaste, near the border with Nicaragua. Oranges are also grown in other regions of the country including Acosta (near the Central Valley) and Nandayure in Guanacaste. However, oranges from those areas are mostly sold as fresh fruit in the local market.

    There are also some medium and small size independent producers near the areas where the two processing plants are located. While the larger operations have been stable and plan their activities with a longer-term view, the smaller independent producers tend to supply the processing market (rather than selling into the fresh fruit market) in response to short-term price fluctuations. Smaller producers have also been exiting orange production altogether over time as orange yields and orange prices have made other activities more attractive.

    Harvest is mainly from January to May, with peak production in March and April. The vast majority of commercial oranges are processed for juice concentrate for the export market. A relatively small volume of fresh fruit is sold for local consumption, and processing plants also sell small volumes of juice to local food processors for branded products and for further processing.

    TicoFrut has orange plantations in Nicaragua, near the border. Growing conditions are favorable in that area, and land prices and labor costs are generally lower. Costa Rican processors have partnered with Nicaraguan businesses to plant orange groves in Nicaragua for processing in Costa Rica. According to data from the Government of Costa Rica, the country imported 69,800 metric tons (MT) of fresh oranges from Nicaragua in 2020, compared to 56,644 MT during 2019. Imports from Nicaragua during 2021 reached 66,444 MT through October.

    Within orange area planted, farmers are gradually increasing the number of trees per hectare by using the “Flying Dragon” pattern, which supports higher tree density, easier farm management, and lower costs per hectare. This innovation has allowed farmers to significantly increase tree density, moving up from 300 – 450 trees/ha under traditional planting patterns to 800 to 900 trees/ha with the Flying Dragon. FAS/San José anticipates major growers to direct investments toward replanting existing area with new trees and new patterns, rather than increasing area planted, in the near- to medium-term.  Local industry estimates area planted at around 21,000 hectares (ha) and 7.4 million orange trees, including the area planted on the Nicaraguan side of the border. With reports of reductions in area planted to oranges – as citrus greening disease changes yields and profitability calculations – FAS/San José expects area planted to remain flat or decline slightly in 2022 as the effects of citrus greening persist and as major growers concentrate on improvements to current production areas through replanting and irrigation investments.

    Citrus greening disease was first identified in Costa Rica in 2011 and remains a major concern for producers. Citrus greening is reportedly endemic throughout most of the country’s growing areas, increasing costs, decreasing yields, adding uncertainty to future production plans, and limiting growth of production area and volumes. The largest farms have had some success mitigating the effects of the disease by establishing strict controls, including constant farm surveillance, inspection of all farms, and eradication of 100 percent of affected plants. Better capitalized producers use agrochemicals and biological controls (a wasp, called tamarixia radiata, that feeds on the vector of the disease) as part of their preventive measures. The disease has reportedly caused production area to be reduced or abandoned, but FAS/San José has not been able to confirm the extent. Smaller producers, less capable of and less likely to invest in agrochemicals and biological controls, have reportedly suffered heavier losses.

    FAS/San José forecasts total production to increase by 3 percent to 300,000 MT in MY 2021/2022. The largest farms have stabilized production levels through consistent citrus greening management over the last few years, resulting in smaller overall production fluctuations. In 2020/2021, the sector benefited from a more predictable, formalized government migration process for temporary laborers during the pandemic. Securing imported labor supplies was crucial not only for the 2021 harvest, but also for agricultural management practices earlier in the growth cycle (e.g., during flowering) that require imported labor. According to industry sources, fuel and fertilizer costs have increased approximately 30 percent in 2021, adding to the not insignificant additional costs of managing citrus greening – agrochemicals, integrated pest management, and eradication of affected plants.

    Costa Rica exports most of its orange production as frozen concentrated orange juice (FCOJ); single strength fresh orange juice exports represent less than 25 percent of total export volume. According to information from the Costa Rican Trade Promotion Board (PROCOMER), calendar year 2020 juice exports to all destinations amounted to 21,800 MT (valued at $34.6 million), down considerably from 32,897 MT (valued at $50 million) in 2019. Trade data through October 2021 show total exports rebounding to 30,819 MT and $42.9 million, respectively.

    FAS/San José expects 2021/22 total exports to increase slightly to 33,000 MT. The United States continues to be Costa Rica’s leading destination for orange juice exports in 2021. Total exports to the United States through October 2021 were 16,582 MT (valued at $31.1 million), already surpassing the 13,177 MT (valued at $26.9 million) shipped to the United States in 2020. Costa Rican orange juice enters the United States duty free under the Central American-Dominican Republic Free Trade Agreement. — By Victor Gonzalez, USDA Foreign Agricultural Service

  • Blueberries Around the Globe – Past, Present, and Future

    USDA International Agricultural Trade Report — Trade and production of blueberries is expanding globally as product development boosts their profile in form and function. Hailed for their flavor, versatility, and health benefits, blueberry consumption has expanded beyond fresh, ranging from pureed to powdered forms. Blueberries are also being used as ingredients and additives in foods and beverages. These new uses and forms of blueberries are combining with increasing fresh consumption to drive up production worldwide. Global production and trade have seen the most dramatic growth between 2010 and 2019, driven ever higher by mounting consumer demand.

    Domestication of Blueberries: From Idea to Industry

    The development of cultivated blueberries began in the early 1900s through the collaboration of Elizabeth White and USDA botanist Frederick Coville. Living on a cranberry farm in New Jersey,  White started conducting her own research into wild highbush blueberry plants in the 1890s. Coville began his research on cultivating wild blueberries in 1908. After they began corresponding, White eventually invited Coville to work with her on her family farm. They become business partners in 1911, harvesting and selling their first commercial crop of blueberries in 1916.

    Since then, commercial blueberry production has expanded in the United States and to every continent except Antarctica. Enabled by advances in genetics and production practices, blueberries were grown in at least 30 countries in 2019 and in a variety of climates. The major classes of blueberry plants now grown commercially are highbush, lowbush (sometimes referred to as wild), half-high (a cross between highbush and lowbush species), Rabbiteye, and Southern highbush. Plant production can be short or long-lived, with some cultivar plants productive for as little as 1-5 years or as long as 40-60 years.

    Global Production

    Global production more than doubled between 2010 and 2019, rising from 439,000 metric tons to nearly 1.0 million. During this time, the number of countries with reportable production expanded from 26 to at least 30, with 27 countries showing growth. In 2010, only 4 countries produced more than 10,000 tons:  the United States (224,000 tons), Canada (84,000 tons), Chile (76,000 tons), and France (11,000 tons). The number of countries producing at least 10,000 tons started increasing by 2012 and has not declined since then. By 2019, at least 11 countries were above the 10,000-ton threshold. Peru had the most dramatic expansion, rising from less than 50 tons to nearly 125,000 to become the fourth-largest producer behind the United States, Canada, and Chile. Peru is now the world’s leading exporter by value.

    Southern Hemisphere countries account for nearly 40 percent of the world’s production growth during this time, reaching close to 300,000 tons in 2019. The spread of production to the Southern Hemisphere has expanded blueberries’ seasonal market presence to all 12 months of the year, boosting availability for consumers and driving worldwide demand.

    In the United States, blueberries are the second-most produced berry. Until the early 1970s, they were commercially grown mostly in three states:  New Jersey, Michigan, and North Carolina. The industry worked to develop production in other states. In the 1990s, U.S. production reached 100 million pounds or more than 45,000 tons. In 2010, Michigan was the largest producer at almost 50,000 tons, accounting for 22 percent of U.S. production. Other states were expanding output, with Washington becoming the top grower in 2015. Washington remains the leading producer averaging 58,000 tons per year and 19 percent of U.S. production, while Oregon is a close second averaging 55,000 tons. The number of states that USDA’s National Agricultural Statistics Service includes in its annual survey was reduced from 14 states to 9 states in 2018 (the other 5 states accounting for less than 5 percent of production). However, production has continued to rise, reaching a record 339,000 tons in 2019. U.S. production has averaged nearly 300,000 tons since 2015, accounting for 36 percent of global production.

    Global Exports

    The World Customs Organization (WCO) publishes the International Harmonized Commodity Description and Coding System (Harmonized System or HS), a “multipurpose international product nomenclature” that is a hierarchical framework consisting of 4- and 6-digit classification codes (referred to as headings and subheadings, respectively). Currently, blueberries do not have their own 6-digit classification code. Under the HS, they are classified and harmonized in HS-6 codes that group them with other fruits of the genus Vaccinium (including cranberries), making it difficult to get an accurate understanding of actual blueberry trade. (See section below “Working Towards Better Trade Data.”) By using data from the U.S. Census, Food and Agriculture Organization of the United Nations (FAO), and industry as a guide, leading fresh blueberry exporters include Peru, Chile, Mexico, the United States, South Africa, Poland, and Canada.

    Though the value of fresh blueberry export trade is not known for all exporting countries, looking at these countries gives a good indication of the export situation. Using U.S. Census Bureau, Trade Data Monitor, and country data provided by FAS’s overseas offices, exports for these countries totaled $2.1 billion in 2019. For these seven countries, combined growth has averaged 18 percent annually since 2016, with Peru, Mexico, Poland, and South Africa seeing continuous growth. If exports average only 5 percent growth during the next 5 years, export value for these countries alone will reach nearly $3.0 billion by 2025. According to FAO data, global export volume has not declined since at least 2010, rising on average 46,000 tons per year between 2015 and 2019. Considering the expansion in production and exports since 2010 and the continued rise in consumer demand, exports of fresh blueberries are expected to continue their upward trajectory.

    Growth has been more moderate for U.S. exports. While the export value of fresh blueberries has grown 30 percent between 2010 and 2019, exports experienced 4 straight years of decline between 2014-2017, some of which coincided with years of lower output. On either side of that timespan, exports had peaked at $147 million in 2013 and have seen continuous growth since 2017, rising from $107 million to nearly $121 million in 2020. For 2021, January-July exports are slightly ahead of last year, up $3 million to nearly $99 million. On average, more than 80 percent of U.S. shipments go to Canada, valued at more than $106 million in 2020. Among the seven leading exporters, the United States ranks fourth behind Peru, Chile, and Mexico.

    The Future of Global Production

    Research into varieties no longer relies on public institutions but is now also happening in private industry, resulting in more rapid advances in genetics and varietal development. Research is underway to improve yield, berry quality, disease and pest resistance, and cold and heat resistance. Improvements are also happening in technology to better manage, harvest, and package crops. For example, due to its range of required chill hours (from 400 to 0 hours), Southern highbush cultivars can be grown as an evergreen, a system of managing bushes to produce berries year-round or at specific points in time. Depending on the geographic area, “evergreening” can prevent or manage defoliation through timing and severity of pruning. While prevention enables year-round production, managed defoliation allows growers to control or target when berries will be ripe, and therefore when they can be harvested. For managed defoliation, depending on the cultivar, the time period between pruning and harvest ranges from 5 to 8 months. For example, if aiming for a May harvest, bushes would be trimmed in January. While evergreen production is used in some areas of the United States, it has also allowed the spread of blueberry production to areas with warmer climates such as Australia, Mexico, Peru, and Spain.

    Current blueberry varieties are all within genus Vaccinium and section Cyanococcus. However, wild varieties outside Cyanococcus are known to exist around the world, including in more isolated areas such as islands in the South Pacific. With the success of blueberries, some of these countries are starting to cultivate their wild varieties. The current level of science does not yet easily allow the combining of genetics from Cyanococcus and non-Cyanococcus varieties. Expected advances in genetic technology will likely make this possible in the coming decades, leading to the development of new varieties and further spreading blueberry production.

    Working Towards Better Trade Data

    As noted above, blueberries are included in HS-6 codes that group blueberries with other fruits of the genus Vaccinium, such as cranberries and bilberries. Under the HS, blueberries are currently classified and harmonized globally at the HS-6 level subheadings of 0810.40 (fresh), 0811.90 (frozen), and 0813.40 (dried). Monitoring blueberry trade is challenging because only some countries break out blueberries beyond the HS-6 level as the United States does for fresh, frozen, and dried.

    Due to the considerable growth in global blueberry production and trade in the past 10 years, especially trade in fresh blueberries, FAS has prepared a proposal to submit to the WCO to amend the HS by creating specific subheadings for fresh, frozen, and dried blueberries, thereby distinguishing them from other Vaccinium fruit. Proposals for amendments to the HS are typically submitted by the industry. However, due to the need for global trade data, FAS has undertaken this effort to provide clarity on trade (and thus production) and achieve a more precise understanding of how large the market is and where trade (and thus production) is happening.

    The following are the steps for submission, review, and approval for amendments to the HS:

    1. Proposal is submitted to U.S. International Trade Commission (USITC) – if approved, USITC submits the proposal to the Trade Policy Staff Committee (TPSC).
    2. TPSC approval – if approved, USITC submits the proposal to the World Customs Organization HS Review Sub-Committee (WCO HS RSC) as an agenda item for their next meeting.
      Note:  TPSC is an interagency committee that includes representatives from USITC, USDA/FAS, the Department of State, the Department of the Treasury, the Office of the U.S. Trade Representative, the Department of Commerce, and the Department of Homeland Security/Customs and Border Protection.
    3. WCO HS RSC approval – if approved, the WCO HS RSC submits the proposal to the WCO HS Committee (HSC) for review at their next meeting.
    4. WCO HSC approval – if approved, the proposal is forwarded to the WCO for adoption.
    5. WCO adoption – if adopted, the proposed coding changes will be reflected in the next iteration of the HS, which means it will also be reflected in the Harmonized Tariff Schedule of the United States.

    FAS submitted a proposal to USITC in September 2021. If it successfully proceeds through the above process, the proposed changes will be reflected in the 2027 HS. Though it will be several years before the changes are implemented, ultimately the changes will significantly improve our ability to understand and forecast blueberry trade.

  • India Confirms Prunes not Subject to the non-Genetically Modified cum Genetically-Modified-Free Status Certificate Requirement

    FAS New Delhi (Post) secured confirmation from the Food Safety and Standards Authority of India that prunes from plums (Prunus domestica) are a processed food product (dried fruit), and as such are not subject to the non-Genetically Modified (GM) cum GM-Free status certificate requirement. Industry’s concerns for clarification necessitated post’s outreach. U.S.-origin prune exports to India reached nearly $1 million in 2020.

    DISCLAIMER: The information contained in this report was retrieved from the Food Safety and Standards Authority of India’s (FSSAI) website http://www.fssai.gov.in. The U.S. Embassy in New Delhi – Foreign Agricultural Service (FAS) Office of Agricultural Affairs (OAA), USDA and/or the U.S. Government make no claim of accuracy or authenticity. The Government of India has not officially endorsed this report. Import approval for any product is subject to local rules and regulations as interpreted by Indian officials at the time of product entry.

    GENERAL INFORMATION:

    On April 13, 2021, FAS New Delhi\Office of Agricultural Affairs secured confirmation from the Food Safety and Standards Authority of India’s (FSSAI) Director of Imports, Dr. Amit Sharma, that prunes from plums (Prunus domestica) are a processed food product (dried fruit). As such, prunes are not subject to the non- Genetically Modified (GM) cum GM-Free status certificate requirement. Industry’s concerns for clarification prompted post’s outreach.

    FSSAI, in its Clarification dated October 12, 2020 (Appendix I), referencing the Order of August 21, 2020 (Appendix II), mentions that the requirement to obtain a non-GM cum GM-Free status certificate for all food import consignments containing any of 24 specific foods (including fruits, vegetables, and grains) does not apply to processed food products in general.

    In calendar year 2020 (January-December), U.S. prune exports to India reached nearly $1 million. — By Radha Mani, Agriculture Assistant and Mariano Beillard, Senior Regional Agricultural Attache, USDA Agricultural Research Service

  • US Continues to Dominate Canadian Market for Fresh Apples, Pears & Table Grapes

    The United States will remain the largest exporter of fresh apples, pears, and table grapes to the Canadian market in marketing year (MY) 2020/21. FAS/Ottawa forecasts a five percent growth in Canadian apple production for MY 2020/21 with fewer weather-related challenges. A reduction in the marketed production of Canadian pears and table grapes is anticipated as a result of weather and COVID-19 labor challenges during harvest; forecast down seven percent for pears and 13 percent for table grapes. Canadian exports of fresh apples will grow slightly in MY 2020/21. The United States will remain the main market for Canada’s apple exports.

    Executive Summary:

    –  In MY 2020/21 Canadian imports of fresh apples will see a decline while exports will grow modestly compared to MY 2019/20. The United States will remain as Canada’s main trading partner.

    –  FAS/Ottawa forecasts growth in Canadian apple production as a result of improved weather conditions predominately in Ontario and Quebec.

    –  Pear production for MY 2020/21 is forecast to decline as a result of drought in Ontario and labor issues impacting harvest in British Columbia.

    –  Canadian imports of fresh pears will see modest growth in MY 2020/21 as a result of a reduced domestic crop. U.S. pears will remain as the highest market share but will continue to face competition from Argentina, China, and South Africa.

    –  FAS/Ottawa forecast a decline in Canadian table grape production for MY 2020/21 primarily as a result of summer drought conditions in Ontario growing regions.

    –  Imports of fresh table grapes with increase slightly as a result of the reduced Canadian crop. Consumer interest in organic grapes will continue to be supported.

    APPLES

    NOTE: “NEW FAS/Ottawa” data reflect FAS/Ottawa’s assessments and are NOT official USDA data

    Production:

    FAS/Ottawa forecasts five percent growth in Canadian apple production in marketing year (MY) 2020/21 despite some production challenges. Over 90 percent of Canadian apple production is concentrated in British Columbia, Ontario, and Quebec. While weather presented many challenges for the Eastern Canada crop in 2019/20, conditions were more favorable for the 2020/21 crop. Despite dry conditions during the summer, moisture was reportedly received in time to produce a good quality crop for size and color in Ontario. Quebec is also reporting a strong crop. In British Columbia, hail damage in the spring impacted crop quality and smoke from wild fires along the west coast of the United States affected coloration of some varieties. The Maritime Provinces experienced drought through the summer, which is believed to have reduced apple production. However, despite these challenges, early estimates indicate an overall larger apple crop in MY 2020/21 compared to last year. Honeycrisp acres are forecast to see higher production in MY 2020/21 compared to 2019/20.

    FAS/Ottawa forecasts a slight gain in cultivated acreage, in 2020/21, compared to 2019/20, as more Honeycrisp, Gala, and other premium varieties are planted. Bearing acreage will also increase as previously planted acreage matures into fruit production. However, these gains are expected to be offset by continued reduction in McIntosh acreage. Planted acreage suffered a 3.5 percent drop in 2019/20 according to Statistics Canada. In addition to the shift to production of premium varieties, producers are moving to higher density plantings for production efficiency.

    Canadian apple growers have experienced labor challenges related to COVID-19. Spring orchard maintenance, such as thinning and pruning, was affected as fewer temporary foreign workers (TFW) entered Canada due to Canadian travel restrictions implemented in mid-March. At the urging of industry, government eventually designated TFW as essential, though they still had to observe a mandatory 14-day quarantine upon arrival in country. TFW admitted under Canada’s Seasonal

    Agricultural Worker Program can transfer between employers provided appropriate approvals are received; this likely mitigated labor shortfalls in some locations. Recruitment of Canadian workers to fill the gaps met with only limited success. The worker shortage persisted into harvest time, which may have negatively impacted actual crop size despite strong production estimates. This issue is reportedly most significant in British Columbia, which has struggled with low TFW arrival numbers throughout 2020.

    Certain growing regions are better suited to specific apple varieties. British Columbia, Nova Scotia, and Ontario have a greater variety diversification owing to the climactic conditions in the Okanagan, Annapolis Valley, and Niagara growing regions, respectively. Quebec growers typically embrace more durable and resilient varieties due to colder growing conditions. Changes to variety acreage and production will continue to vary by province. The general trend points to increases in Ambrosia, Gala, and Honeycrisp.

    Consumption:

    Approximately 70 percent of apples grown in Canada go to fresh consumption. FAS/Ottawa forecasts growth in both fresh and processing apples for MY 2020/21 on an overall larger crop. Fresh demand will be strong as consumers seek a cost competitive fruit with a longer storage duration. As a result of COVID-19 consumers appear to have shifted their purchasing habits, reducing their perceived COVID- 19 risk by limiting themselves to fewer grocery store visits but spending more per visit. In the spring, retailers shifted from bulk displays of apples to consumer pre-packaged in response to changing consumer purchase patterns and hygiene concerns within the retail environment. Indications are that bulk displays and local apples features will resume this fall despite rising COVID-19 cases in Canada. Food service was also impacted as provinces and regions implemented restrictions on restaurant

    Pecent Total Production

    activities. Apples have been less susceptible to food service disruptions than other commodities. With restrictions on gatherings and food service businesses, demand for desserts such as pies has been reduced and there has been a negative impact to processing apples that go into desserts. Despite this, FAS/Ottawa forecasts processing numbers will increase because of an abundance of lower quality apples harvested in British Columbia and the Maritimes subsequent to the adverse weather conditions in those provinces.

    Per capita consumption of fresh apples is forecast to remain static in MY 2020/21. However, due to a growing Canadian population the overall quantity of apples consumed fresh will increase in Canada in MY 2020/21. Apples face increasing competition with other fresh fruit products on the market but will continue to be a popular snack given their convenience. Their longer duration storage life and cost- competitiveness with other fruits will also support consumption as consumers look for stability and savings in the face of COVID-19-related uncertainties expected to remain for some time to come.

    Trade:

    FAS/Ottawa forecasts a one percent decline of imports of fresh apples into Canada for MY 2020/21. An increased Canadian apple crop and reduced processing demand due to COVID-19, will generate lower demand for imports. The United States will remain the dominant supplier of apples to Canada. The U.S. market share increased to 84 percent in MY 2019/20 following a decline in MY 2018/19 owing to increased imports from Chile and the EU and a smaller U.S. apple crop. Market share was regained in MY 2019/20 due to a larger U.S. crop and a reduced EU crop. Reduced crop expectations for the U.S. and EU crops in MY 2020/21 will also support a decrease in Canadian import volumes.

    Despite a smaller 2019/20 crop, Canadian fresh storage volumes were up 29 percent in June 2020 compared to June 2019. With ample supplies remaining until the 2020/21 crop begins to be marketed, reductions in imports have already been witnessed in MY 2020/21. However, support will remain for imports of U.S. fresh apples to supplement Canadian fresh demand. The majority of U.S. apples are imported into Canada from Washington State followed by New York. Canada is the top market by value for fresh apple exports from both states.

    Imports of organic apples have increased steadily year-over-year since MY 2015/16. Consumer surveys have shown that Millennial Canadians, currently the largest generational cohort in Canada, are driving growth in organic purchasing. Generation Z (post-millennials) also are contributing and are expected to further contribute as their cohort continues to age into the workforce. However, it appears likely that the economic effects of the COVID-19 pandemic will constrain this preference for organic products, which tend to be higher priced, in MY 2020/21.

    Approximately 10 percent of fresh apple production in Canada is exported depending on the Canadian apple crop size. FAS/Ottawa forecasts that exports will grow 10 percent in MY 2020/21 as a result of the increase in the Canadian apple crop. However, outyear exports will remain below the five-year average due to decreased processing demand and COVID-19 disruptions. The United States was, as usual, the top market for Canadian fresh apple exports in MY 2019/20 and will remain as such in MY 2020/21. Canadian apple exporters may also look to continue expansion into CPTPP markets as tariffs under the trade agreement have become more favorable (see Policy section). With a smaller EU crop there is likely to be supply gaps in these markets.

    PEARS

    NOTE: “NEW FAS/Ottawa” data reflect FAS/Ottawa’s assessments and are NOT official USDA data 

    Production:

    FAS/Ottawa forecasts a seven percent decline in fresh pear production for MY 2020/21. Marketed production is projected to be less than the five-year average due to harvest challenges in British Columbia combined with reduced labor availability and drought conditions in Ontario. Area planted is expected to remain static in MY 2020/21 while area harvested will decline two percent as a result of labor and weather issues.

    Ontario and British Columbia account for over 90 percent of the Canadian pear crop and these two provinces will continue to dominate domestic production. British Columbia experienced a favorable growing season for MY 2020/21 and though smoke from west coast fires did cause some harvest delays the smoke is not expected to impact fruit quality. British Columbia also struggled with obtaining sufficient numbers of workers for the MY 2020/21 harvest as a result of COVID-19. The available local workforce is limited and growers typically rely on workers from other regions of Canada, such as Quebec, as well as international and temporary foreign workers. COVID-19 restrictions, travel disruptions, and government support programs viewed by some as a disincentive to work have constrained the availability of both domestic and foreign workers. As a result, not all fruit is expected to be harvested, which will reduce marketed production. While Ontario has also seen reductions in the number of foreign workers arriving in MY 2020/21, the pear crop declined primarily due to dry summer weather conditions. Pear production industry estimates indicate that production will be 20 percent or more below MY 2019/20 in some regions. Bartlett and Bosc varieties will continue to dominant Canadian pear acreage but producers are exploring new varieties. In British Columbia, Bosc acreage is reportedly increasing while Bartlett and Anjou acreage has been in decline due to shifts in consumer preference and poorer returns. Anjou is not well suited to the Ontario growing climate, where Bartlett and Bosc dominate production and acreage.

    Consumption:

    Fresh consumption is expected to experience minimal growth in MY 2020/21 due to lower production. Canadian per capita consumption of fresh pears has been on a declining trend since 2013 as pears face increased competition from other fruits.

    Fresh consumption accounts for over 80 percent of the pear market in Canada. There are a limited number of processors and with a smaller 2020/21 crop, processing will remain static on MY 2019/20.

    Trade:

    FAS/Ottawa forecasts a three percent growth in fresh pear imports for MY 2020/21 although imports will remain below the five-year average. Increased imports will offset the reduction in Canadian production for MY 2020/21. However, competition from other fruit varieties is expected to limit expansion of pear imports. The United States will continue to supply around 50 percent of total Canadian imports of fresh pears.

    Imports of organic fresh pears continue to be between four and five percent of total pear imports. FAS/Ottawa forecasts that Canadian demand for organic fresh pears will remain constant for MY 2020/21.

    Canadian exports of fresh pears are negligible in comparison to fresh pear production and imports. Canadian MY 2019/20 pear exports jumped 25 percent over 2018/19 levels, yet were still only four percent of domestic production. While growers may continue efforts to expand export opportunities to higher value markets in MY 2020/21, FAS/Ottawa anticipates pear export volumes will remain below one percent of import volumes.

    FRESH TABLE GRAPES

    NOTE: “NEW FAS/Ottawa” data reflect FAS/Ottawa’s assessments and are NOT official USDA data

    Production:

    FAS/Ottawa forecasts a 13 percent decline in table grape production for MY 2020/21. Fresh production will be 10 percent below the five-year average. Drought conditions in Ontario, coupled with labor challenges in British Columbia, will see the crop reduced by over 20 percent in some regions according to industry estimates, as well as a reduction in marketed production. Acreage is forecast to remain stable although fruit bearing acreage will be reduced.

    Ontario will continue to be the main province for Canadian table grape production, accounting for over three-quarters of Canadian production. British Columbia is the second largest producing province accounting for over 20 percent of production. Though Ontario table grape production is mostly limited to the Sovereign Coronation variety, Ontario growers and researchers are exploring new varieties in response to changing consumer demands. While drought will negatively impact Ontario production volumes for MY 2020/21, British Columbia experienced more favorable growing conditions. However, COVID-19 has impacted the labor pool in British Columbia with fewer foreign workers arriving in the province and fewer domestic workers travelling from Eastern Canada to work during harvest.

    Additionally, smoke from fires on the West Coast caused harvest activity delays. Crop quality is not expected to be negatively impacted. Due to these challenges, marketed production volumes will be less than total production volumes.

    Compared to wine grapes, table grape acreage and production is nominal in Canada and acreage is unlikely to see a significant increase in the short-term.

    Consumption:

    FAS/Ottawa forecasts very limited growth in fresh table grape consumption for MY 2020/21 supported by increased imports. Per capita table grape consumption will remain static compared to MY 2019/20. Canadian consumption of fresh table grapes has been relatively stable since 2011.

    Trade:

    FAS/Ottawa forecasts imports of fresh grapes to grow slightly in MY 2020/21 in order to supplement the reduced domestic crop. Given the limited production of table grapes in Canada, consumer demand is primarily met through imports. The United States typically supplies over 50 percent of Canadian imports. The United States will remain the dominant supplier with competition from South Africa. Imports from Mexico are forecast lower for MY 2020/21 as a result of a smaller Mexican crop. Demand for fresh table grapes is not anticipated to be significantly impacted by COVID-19 although transport logistics from overseas markets may impact volumes.

    Imports of organic fresh table grapes have experienced steady volumetric growth since MY 2016/17. In MY 2019/20, organic grape import volumes increased 48 percent year-over-year, though organic still only comprises five percent of total imports. Similar to apples, younger consumers are driving the demand for organic products. FAS/Ottawa forecasts that imports of organic grapes will continue to see

    some growth in MY 2020/21 but economic challenges related to COVID-19 will mitigate some demand. The United States is the main supplier of organic grapes to Canada but in MY 2019/20 did see a reduction in market share as a result of increased imports from Mexico and South Africa.

    Canadian exports of fresh table grapes are extremely minimal though Canada does import some fresh table grapes which are then re-exported. These re-exports account for all of Canada’s exports of fresh table grapes according to sources. The majority of Canadian grape production is of wine varieties with limited table grape production. The lack of production and strong Canadian domestic demand limits any fresh table grape exports.

    ADDITIONAL INFORMATION

    Prices

    Agriculture and Agri-Food Canada (AAFC) monitors fresh apple, pear and grape prices in the major Canadian wholesale markets. Any daily and weekly market wholesale prices are made available electronically at the AAFC InfoHort website.

    Retailer Fees

    In July 2020, Walmart Canada announced that it would be implementing fees on suppliers as part of a cost-offsetting measure for CAD 3.5 billion in upgrades that the company will undertake. The fee structure involves a 1.25 percent infrastructure development fee to suppliers for its retail stores and 5 percent for products sold on its e-commerce site. In October 2020, Canada’s largest grocery retailer, Loblaw Companies Ltd., also announced that it would be implementing extra fees for certain suppliers to offset the cost of upgrades it will be undertaking. Loblaws indicated that suppliers received different fee structures and that smaller suppliers would have an exemption; more specific details have not yet been made public. In response to the Walmart announcement, another major Canadian grocery retailer, United Grocers Inc., informed suppliers that while it is not implementing supplier fees that it would expect equal treatment if cost reductions are given to competitors. Several Canadian food industry associations have expressed strong opposition to these announcements indicating that this will further erode profits in thin margin businesses at a time when they are already facing additional costs due to COVID-19. Further, they anticipate that this will stifle businesses ability to invest in improving their infrastructure and innovating.

    Policy:

    Safe Food for Canadians Regulations

    Many provisions of the Safe Food for Canadians Regulations (SFCR) were implemented in January 2019 with some elements scheduled to be phased in through 2021. The Canadian Food Inspection Agency contains more information on these regulations. Lot code provisions were scheduled to come into force January 15, 2020 for fresh fruits and vegetables. While traceability requirements must be met, industry has been given until January 15, 2021 to use remaining packaging and to update packaging labels to meet lot code requirements.

    Single Use Plastics Ban

    In October 2020, the Government of Canada announced proposed regulatory changes as part of a broader initiative aiming towards achieving a zero plastic waste strategy by 2030. Under this proposal 6 single-use plastic products (listed below) were identified as highly problematic and are proposed to be banned. The public consultation runs until December 2020 with a final decision expected in 2021. At this time, consumer pre-packaged produce for retail does not appear to be targeted.

    –  plastic checkout bags

    –  stir sticks

    –  6-pack rings

    –  cutlery

    –  straws

    –  food service ware made from problematic/hard-to-recycle plastics

    Surplus Food Rescue Program

    In June 2020, the Government of Canada announced a CAD 50 million Surplus Food Rescue Program. The initiative was designed to provide funding to help re-distribute food displaced by COVID-19 disruptions in processing and food service to vulnerable Canadians at the cost of production. To date, FAS/Ottawa is not aware that apples, pears, or table grapes have been involved in this program.

    CPTPP

    Canada was one of the first six countries to ratify the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). CPTPP entered into force for Canada, Australia, Japan, Mexico, New Zealand, and Singapore on December 30, 2018. Vietnam entered CPTPP into force on January 14, 2019. The first six countries saw the first tariff reductions occur upon CPTPP implementation. Five of the original six countries applied the year 2 tariff reductions on January 1, 2019. Moving forward, further tariff reductions will continue to occur on January 1 of each year until the step-down process is complete. Japan is the exception, where the second tariff reduction occurred on April 1, 2019 with step- downs occurring on April 1 for subsequent years. Despite not being in the original six ratifying countries, Vietnam and Canada agreed to recognize both tariff reductions when CPTPP entered into force for Vietnam. Tariff reductions and eventual eliminations on apples will be most impactful for Canada. Canada will see tariffs on fresh apple exports to Japan reduce from the MFN rate of 17 percent to elimination of tariffs after 2029; currently 12.7 percent reducing to 11.4 percent in 2021. For Vietnam, the MFN tariff of 10 percent on fresh apples will be phased out under CPTPP by 2021; currently 5 percent for 2020. Canada already has tariff-free access for fresh apples to Mexico under NAFTA.

    USMCA

    On November 30, 2018 the United States, Canada, and Mexico signed the new United States-Mexico- Canada Agreement. This agreement updates the 1994 North American Free Trade Agreement (NAFTA) and came into force on July 1, 2020.

    Promotion and Research Agency

    The Canadian apple industry has been discussing the idea of establishing a national marketing agency to promote the consumption of apples and conduct various research projects for several years. This discussion is still occurring although no formal proposals have been put forth at this time. Such an agency would collect levies on both the domestic production and on imports of apples to fund its activities. — By Alexandrea Watters, USDA Foreign Agricultural Service