California Fruit and Vegetable

Tag: USDA Foreign Ag Service

  • Israel May Seek U.S. Pistachio & Vegetable Imports Due to Turkish Trade Ban

    USDA Foreign Ag Service — Turkey, Israel’s third largest foreign supplier of imported agricultural and related products, recently announced a ban on all trade with Israel due to the regional conflict. Accordingly, Israeli importers may look to source certain agricultural imports from elsewhere. Israel’s leading agricultural and related imports from Turkey include fresh and processed agricultural produce—specifically tomatoes, olive oil, cucumbers, onions, and eggplant. For the United States, pistachios may be in greater demand as Turkey is the only other foreign supplier to the Israeli market.

    Turkey Bans all Trade with Israel

    On May 2, 2024, Turkey announced a ban on all trade with Israel due to the “worsening humanitarian tragedy” in Gaza. According to the Turkish Minister of Trade, the ban will be lifted when a sufficient flow of humanitarian aid flows into Gaza. As a result of the ban, the Israeli government is looking to increase domestic production, Israeli importers are looking for new or expanded sourcing for certain agricultural imports, and regional media reports some Israeli importers are looking for alternative routes to circumvent the ban from Turkey.

    Depending on its length, the trade ban could significantly impact the Israeli market as Turkey is a strong trading partner due to its geographical proximity, a bilateral free trade agreement established in 1996, and competitive prices. Moreover, in the past six months, many Israeli importers looked to increase imports from Turkey as trade via the Red Sea has been disrupted by Houthi attacks on vessels passing through the Bab al-Mandab Strait.

    Turkish Exports to Israel

    In calendar year 2023, total Israeli imports from Turkey were valued at roughly $5.3 billion (5.7 percent of total Israeli imports). For agricultural and related products, Turkey was the third largest foreign supplier to Israel, after Russia and the United States. Israel imported $543 million in agricultural and related products from Turkey (5 percent of the total value of its agricultural and related imports) in 2023.

    As seen in the chart below, Turkish tomato exports represent the largest agricultural export to Israel. However, sourcing for other agricultural products, such as olive oil, sunflower seeds, and certain types of fish, may also be impacted. Furthermore, a quick increase in Israeli production for some agricultural products would be difficult to realize as it could take many months or years to sufficiently supply gaps.

    For the United States, pistachios may see increased opportunities as Israel only imports pistachios from Turkey and the United States (Note: Total value of Israeli imports of pistachios totaled $40.5 million in 2023).

  • New Farm Bill Priorities Supporting Specialty Crop Agriculture

    As legislature continues to work on completing a new Farm Bill, specialty crops may reap greater representation and benefits than in any previous Farm Bill. Watch this brief video featuring Philip Karsting from Olsson Frank Weeda as he discusses their priorities for specialty crop ag at a recent conference held by American Pistachio Growers.

    Special thanks to American Pistachio Growers for sponsoring this video.

  • Growing Chinese Market Demand for Nuts and Dried Fruit

    USDA Foreign Ag Service — Thanks to consumers’ growing preference for healthy food and earlier successful marketing of nuts and dried fruit products across the country, China’s consumption and demand for nuts and dried fruit has exploded over the past few years. To continue this growth, new product innovations, packaging, and flavor concepts for nuts and dried fruit are needed.

    In China, popular nuts and dried fruit include, but are not limited to, almonds, pistachios, pecans, walnuts, macadamia nuts, hazelnuts, dried cranberries, raisins, and dried blueberries. Recently, consumers have sought dried fruit and nuts because of their perceived health benefits, their versatile applications in food manufacturing, and their rich texture and appearance. In China, the “nuts market” segment includes tree nuts and dried fruit.

    Statistics from different sources indicate that the nuts industry has grown robustly over the past decade. Along with strong consumption and sales between 2012 and 2022, imports of nuts expanded substantially from $0.5 billion in 2012 to $3.3 billion in 2022, with record imports in 2021 of $3.5 billion.

    TREE NUTS & DRIED FRUITS MARKET SNAPSHOT

    •   The nuts market reached $40 billion in 2022, accounting for about 20 percent of the total snack food market, competing with candy/chocolate and biscuits/pastry for the number one sector.
    •   The compound annual growth rate for the nuts market was above 10 percent between 2011- 2022, making it a leading manufacturing industry in China.
    •   The tree nut market size reached $8 billion in 2022, remaining far behind seed nuts at $32 billion.
    •   Imports of tree nuts reached $3.28 billion in 2022.

    Imports of dried fruit also increased substantially over the past ten years, increasing from an initial $215 million in 2012 to $946 million in 2022, a 340 percent increase.

    The Popularization of Daily Nuts

    The concept of Daily Nuts originated from a product that was initially launched in 2016 by Wolong, a snack food manufacturer based in Qingdao. Although it is called Daily Nuts, it is a mixture of nuts and dried fruit, such as almonds, pistachios, dried blueberries, and dried cranberries. It is usually in small packs of 15-20 grams, perfect for nutrition supplements and at-work snacks.

    Unlike traditional roasted nuts, Daily Nuts target younger and higher-end consumers. Almost all the nuts and dried fruit used in daily nuts are imported to meet consumers’ high-quality expectations. While the raw ingredients are imported, the roasting, processing, and packaging occur domestically.

    Due to the strong marketing behind Daily Nuts, focusing on the nutritional benefits and portability of the product, the market exploded. Due to the quick expansion of Daily Nuts across China, Alibaba’s Tmall Research Institute created a new sub-sector called mixed nuts (which includes nuts and dried fruit) in 2017, and daily nuts were regarded as a representative of the sub-sector.

    Following the launch of Daily Nuts in 2016, the market size of mixed nuts and dried fruit grew from $1.4 billion in 2016 to $15.8 billion in 2021, a 1,029 percent growth.

    Consolidation of the Mixed Nuts Sub-Sector

    The booming sub-sector has led to market consolidation. Initially, more than 300 brands began selling daily nuts products in China. Big retailers such as Fresh Hippo, an affiliate of Alibaba, and Bian Li Feng, a nationwide franchised convenience store, even created their own daily nuts style private label products. However, recently smaller processors have begun manufacturing for bigger ones. In 2022, the combined market share of the top five brands, Three Squirrels, Haomusi, Wolong, Chacha, and Bestore, amounted to 38 percent; it is estimated that by 2028, the top five brands will expand their combined market share to 54 percent.

    Growing Online Sales

    The main category of consumers of mixed nuts and dried fruit are those aged 20 to 45, which directly corresponds to those consumers who most often utilize e-commerce channels. As a result, most of the sales for mixed nuts occur online. In 2022, 47 percent of all snack food sales occurred online. According to CFNA, in the first half of 2023, online sales of food products increased by 8.9 percent year-on-year. Additionally, new online livestreaming retailers, such as Douyin (Tiktok) and Kuaishou, are taking increasing market share from traditional offline retailers.

    Applications of Mixed Nuts in Food Manufacturing

    Tree nuts and dried fruits are typically used for three purposes: snack food, baking ingredients, and food/beverage ingredients. Although the applications of baking ingredients and food/beverage ingredients have been developing in recent years, the snack food sector has achieved impressive growth.

    The snack food sector includes three sub-sectors, namely single nuts, mixed nuts, and flavored nuts. The single nut sub-sector hosts traditional sunflower seeds, peanuts, hazelnuts, and imported tree nuts, which have become increasingly popular over the last two decades. Mixed nuts, as described in the daily nuts section above, are comprised of products with both nuts and dried fruit. Flavored nuts refer to nut products that are typically roasted, shelled, and then flavored to meet consumers’ personal flavor preferences. Typical flavors include but are not limited to salty, spicy, coconut, mustard and others.

    Sluggish Economic Recovery

    In 2022, strict COVID-19 zero-tolerance regulations impacted China’s economy. According to Tmall statistics, online sales of mixed nuts and dried fruit were nearly zero due to reduced logistics capacity. Offline, traditional sales fared even worse due to the same reduction in logistics capacity and frequent store closures. The economy was expected to rebound after lifting all COVID restrictions, but growth has remained sluggish.

    The overall reduction in spending means consumers are reducing purchases of non-essentials such as snack foods. In recent conversations with retail contacts, we learned that local consumers spending on snack food is only around 60 percent of pre-COVID levels. Although online food purchases increased by 8.9 percent in the first half of 2023, this is thought to be due to the increased sales of lower-cost products. The purchases of nuts and dried fruits, which consist of primarily imported raw ingredients and are more expensive, will continue to be impacted by China’s sluggish economic recovery.

    Declining Growth of Daily Nuts

    In the past few years, tree nuts and dried fruit sales were largely equal to sales of daily nuts products. While Daily Nuts initially led to an explosion in the market, the market is largely saturated. Thus, the market is calling for innovations in the nuts and dried fruit sector to spur growth.

    Booming international and domestic supplies

    China relies on imports of a range of nuts to meet its strong domestic demand. International supplies impact import volumes considerably. For example, with the production of U.S. almonds reaching a historic high in 2020/2021, the price fell substantially, which in turn led to increased exports to China. Increased international production may continue to lower global tree nut prices, making exports competitive.

    However, due to growing domestic supplies, imports of certain nuts and dried fruit are expected to decline. China is the largest producer of walnuts and peanuts globally and has a growing production of macadamia nuts, raisins, and blueberries.

    Over the past ten years, growing demand for nuts and dried fruit has pushed domestic production to record highs. According to CFNA, China’s total nut production in 2023 is 44 percent higher than five years ago.

    Growing domestic production has also decreased prices for dried fruit. For example, in August 2023, the domestic price for raisins was roughly half that of Chile and a quarter of that of the United States.

    Other Promising Products

    Aside from products used for mixed or daily nuts, other dried fruit products are seeing market growth. For instance, local consumers perceive dried prunes as a good source of dietary fiber, translating into increased sales.

    Additionally, growing consumer health consciousness and the still-to-be-explored versatility of nuts and dried fruit in the food manufacturing sector will likely spur market growth. While the previous high growth rates were not sustainable, mild but steady growth is expected.

    New Product Development

    With the saturation of the market for daily nuts, food researchers and developers are making every effort to develop a product with the market power of daily nuts. Potential new uses of nuts and dried fruit could include:

    •   In a beverage
      o Example: Six Walnuts bottled drink, a walnut milk beverage, saw high sales upon its launch due to improved taste and brand image.
    •   In the food manufacturing sector

    o New processed and value-added products such as sliced, diced, minced nuts, or sugared, pureed, marinated fruit, could be used to meet different food manufacturing requirements or demands.

    o China’s expanding food manufacturing industry is calling for more varieties of processed ingredients, offering new market opportunities.

    Identifying and capitalizing on these market opportunities will require more collaboration between suppliers and R&D departments of Chinese food manufacturers in testing and educating the market.

     In chain coffee and milk tea shops
    o Recently, nuts, and dried fruit consumption have increasingly been used for beverages at chain coffee and milk tea shops across China.

    o This demand comes from two usages: one is a small pack of nuts and dried fruit consumed alongside coffee or milk tea, and the other is used as ingredients for baking and pastries in coffee or milk tea shops.

    o Neither of these uses is new, but the demand and consumption have grown substantially in line with the rapid expansion of coffee and milk tea shops.

    For more information, please contact ATO Beijing:

    USDA Agricultural Trade Office in Beijing U.S. Embassy, Beijing, No. 55 An Jia Lou Road Chaoyang District, Beijing
    China, 100600
    Tel.: 86-10-8531-3950
    Fax: 86-10-8531-3974
    Email: atobeijing@usda.gov

  • Canada Reimplements Temporary Import Requirements for US Romaine Lettuce

    Canada will once again implement additional temporary import requirements for U.S. origin romaine lettuce for Fall 2023. The additional requirements will be in effect from September 28, 2023 to December 20, 2023. As with previous years’ requirements, Canada will require imported romaine lettuce and/or salad mixes containing romaine lettuce originating from the Salinas Valley counties of Santa Clara, Santa Cruz, Monterey, or San Benito to have a negative test for E. coli O157:H7 or a Proof of Origin for romaine and/or salad mixes from other U.S. growing regions.

    Since 2019, the Canadian Food Inspection Agency (CFIA) has implemented additional import requirements during the Fall period for U.S. romaine lettuce. Specific testing requirements for E. coli O157:H7 have been implemented since 2020 for romaine lettuce originating from the Salinas Valley counties of Santa Clara, Santa Cruz, Monterey, and San Benito. CFIA is once again implementing requirements for Fall 2023 during the time period of September 28, 2023 to December 20, 2023.

    Market Impact

    Since 2019, the implementation of additional import requirements for U.S. romaine lettuce during the final quarter of the year has acted as a market disruptor, with Canadian importers and U.S. exporters challenged to implement the new requirements. In November 2019, CFIA issued a notice that imports of romaine lettuce from the United States must not come from lettuce harvested from the counties of Santa Clara, Santa Cruz, Monterey, and San Benito. In October 2020, CFIA’s import requirements permitted imports from the counties of Santa Clara, Santa Cruz, Monterey, and San Benito with the completion of a negative E. coli O157:H7 test. These additional import requirements resulted in logistical challenges around sampling and diagnostic capacity, consumers and wholesalers reported higher prices, and were periodically challenged to source product. With potential threats to a consistent supply, wholesalers began seeking out additional suppliers.

    Prior to 2019, the five-year average of fresh lettuce imports into Canada in Q4 was 51,640 MT, with the U.S. market share reaching 99 percent, 62 percent of which came from California. During the past four years, when additional import requirements were in effect, the average Q4 imports were 47,350 MT. During this time, the U.S. market share was down slightly averaging 94 percent with California dropping to 53 percent market share. The average Q4 volume from Mexico almost quadrupled in the 2019-2022 compared to 2014-2018, increasing from one to five percent. Imports of Mexican romaine to Canada in Q4 may be particularly advantaged if additional import requirements for U.S. origin romaine lettuce continue to be burdensome for importers.

    Fall 2023 Requirements

    During this time, imports to Canada of U.S. romaine lettuce are required to be accompanied by a Proof of Origin confirming that any romaine lettuce and/or salad mixes containing romaine lettuce do not originate from the Salinas Valley counties of Santa Clara, Santa Cruz, Monterey, or San Benito. Should the romaine lettuce and/or salad mixes containing romaine lettuce originating from the Salinas Valley counties of Santa Clara, Santa Cruz, Monterey, or San Benito then CFIA requires testing for E. coli O157:H7 to confirm it is not detected in order for product to be import eligible. Importers will have a temporary condition on their Safe Food for Canadians (SFC) license for these requirements.

    The requirements remain similar to the 2022 requirements. For imports originating from the counties of Santa Clara, Santa Cruz, Monterey, or San Benito, importers must provide for a protocol in their preventive control plan outlining how they will implement the required sampling and testing. Each shipment must also have the completed attestation declaring that the appropriate sampling and testing was completed and E. coli O157:H7 was not detected in the shipment (Form CFIA/ACIA 5961). The official Certificate of Analysis for testing must also be included with each shipment.

    CFIA provides for two approaches to fulfill the sampling requirements:

    1) Finished-product sampling: sampling and testing is to be conducted before product is imported to Canada but is completed after all post-processing and handling steps are finished. A sampling lot is defined as 1 type or product of a size no larger than 1 truckload (maximum 20,400 kg/45,000 lbs). Each sampling lot must have a total sample weight of 1,500 g comprised of 60 randomized individual sample units of 25 g.

    2) Pre-harvest sampling: field sampling may be completed no more than 7 d prior to harvest. A sampling lot is defined as a 2 acre field or less. CFIA requires the field to be a homogenous romaine lettuce crop subjected to homogenous agricultural conditions. A total sample weight of 1,500 g comprised of 60 randomized individual sample units of 25 g must be taken from each sample lot. This option is primarily designed to accommodate field-packed product.

    The CFIA website provides for additional details on sampling requirements and testing requirements, including accepted methodologies and laboratory accreditation requirements, which are required.  — By Alexandrea Watters, USDA Foreign Ag Service

  • Opportunities to Export Fresh Fruit to Germany

    Germany is one of the largest markets for fruit in Europe. The relative affluence of its population of 83 million people makes it an attractive outlet for exporters from many countries. This product brief highlights certain aspects of the German fresh fruit market and provides marketing, trade, and regulatory information for U.S. exporters.

    Germany, with a population of 83.2 million (18 percent of the EU-27 total population), has the largest economy in Europe and is a leading European market for food and beverages. In 2021, food retail sales in Germany totaled 231.5 billion Euro (approx. USD $274 billion). In 2018 (latest available data), German households spent 28.45 Euro (approx. USD $33.57) per month on fruit.

    In calendar year 2021, Germany was the 7th largest producer of fresh fruit in the EU-27 and the largest fruit consumer. In MY 2020/21, Germans consumed approximately 8.8 million MT of fruit, including frozen and canned fruit on a fresh weight basis. Germans show a preference for fresh fruit, but in MY2020/21 also consumed 67,529 MT of frozen fruit and 125,000 MT of dried fruit. In addition, Germans consume more fruit juices and nectars per capita than any other European country and the United States. The top five fruits consumed in Germany are apples, bananas, oranges, grapes, and clementines. However, Germans are also quite familiar with exotic fruits such as mangos, passion fruit, avocados, and lychees.

    Germany’s position as the largest EU-27 consumer of fruit results from the size of its population rather than high per capita consumption. Growing health consciousness and factors within the German socio- economic makeup, in particular its aging and increasingly foreign-born population, could favor an increase in per capita fruit consumption. At the end of 2021, 22 percent of the population was 65 years and older while only 13 percent were younger than 15 years of age. Moreover, Germany has a high number of immigrants from Turkey and other Mediterranean countries whose diets include a higher percentage of fruits than the traditional German diet. Immigrants in Germany also tend to spend a higher percentage of their income on food. At the end of 2021, more than 11.8 million citizens of other countries lived in Germany. Additionally, in 2020, 4.9 million German residents had a migrant background (i.e., either they or their parents were born with a citizenship other than German and acquired German citizenship later in life). Read the full report from the USDA Foreign Ag Service HERE.

  • Korea Remains a Steady Market for California Citrus

    Korea’s total citrus production for Marketing Year (MY) 2020/21 (October – September) is projected to reach 660,000 metric tons (MT). This 4.5 percent increase over MY 2019/20 volume is attributed to a larger open- field “Unshu” orange crop forecasted in the northern Jeju island growing region. Korea’s 2020/21 citrus consumption is projected to increase 2.9 percent to 567,000 MT due to increased marketing of quality citrus, and a 15 to 20 percent drop in availability of competing domestic fruit. Similar to last year’s trade, Korean fresh orange imports (primarily sourced from the United States) are forecast at 115,000 MT for MY 2020/21. Read the full report from the USDA-Foreign Agricultural Service HERE.

  • Argentina Lowers Export Taxes on Many Specialty Crops

    The Government of Argentina recently announced adjustments to export taxes on many specialty crops, including apples, pears, citrus fruits, blueberries, tomatoes, broccoli, cauliflower, nuts, and alfalfa intended to improve the international competiveness of these products.

    Argentine Government Seeks to Boost Exports of Specialty Crops:

    On Thursday, December 31, 2020 the Government of Argentina published Decree 1060/2020 which made adjustments to the export tax rates for many specialty crops as well as some manufactured goods. After several rounds of export tax changes in recent years the government is attempting to standardize export tax rates for many products at 0%, 3%, 4.5%, and 9% to avoid varying export tax rates among similar products. Previous export tax changes had given some products exchange-rate linked export taxes that had eroded in value as the Argentine peso devalued against the dollar.

    The stated rationale for the policy change is to encourage exports of added-value products and products whose increased production will result in higher levels of employment, and for which increasing exports won’t raise food costs. The government also hopes to encourage investment in these same sectors. Major structural issues such as high fixed operating costs, lack of investment, and currency controls have reduced Argentine competitiveness in many specialty crops over the years, so this measure will be limited in its capacity to boost exports in the short run. Most fruits and vegetables have had export tax rates lowered from 5% to a 0%.

    The list below, by HS Code Chapter, summarizes Annex 1 of Decree 1060/2020 where information on tax rates for specific products can be found. Export tax rates for most major field crops were unchanged, though the decree mentioned the need to adjust rates for certain commodities currently regulated by an expiring decree. Care should be taken to note if a specific HS code is listed in this decree or past decrees.

    Chapter 1 – Live Horses, Cattle, Primates, Dolphins, Pet Birds – 9%;

    Chapter 2 – Beef, Horse, Poultry Meat – 9%; Sheep and Goat Meat – 0%;

    Chapter 3 – Various Fish – 9%; Tilapia, Trout, Carp – 0%;

    Chapter 4 – Fluid Milk – 9%; Ultra High Temperature Milk, Yogurt, Butter, Cheese – 4.5%; Honey – 0%;

    Chapter 5 – Semen & Embryos – 4.5%;

    Chapter 6 – Flowers and bulbs – 4.5%;

    Chapter 7 – Tomatoes, Cauliflower, Broccoli, Brussel Sprouts, Carrots, Cucumbers, Chickpeas, Beans, Asparagus, Eggplant, Celery, Peppers, Spinach, Artichokes, Olives, Pumpkins, Squash, Potatoes, Sweet Corn, Onions, Mushrooms, Garlic, Vegetable Seeds – 0%;

    Chapter 8 – Nuts, Plantains, Pineapples, Avocados, Mangos, Oranges, Mandarins, Clementines, Grapefruit, Lemons, Limes, Watermelon, Papayas, Apples, Pears, Quince, Sour Cherries, Peaches, Nectarines, Plums, Strawberries, Raspberries, Blueberries, Kiwis, Passionfruit, Persimmons – 0%;

    Chapter 9 – Coffee, Pepper, Vanilla, Cinnamon, Cloves, Nutmeg, Mace, Cardamom, Saffron, Turmeric – 4.5%; Tea, Paprika, anise, cumin, coriander – -0%;

    Chapter 10 – “Other” Wheat, Rye, Barley, Corn, Oats, Sorghum – 12%; Grain seeds for planting, Buckwheat, Millet – 4.5%; Quinoa – 0 %

    Chapter 11 – Malt – 9%; Flaked Grains and Germs– 4.5%; Buckwheat flower – 0%

    Chapter 12 – Seeds of Soybeans, Peanuts, and Sunflowerseed for planting, Ginseng, Sugarbeets, Sugarcane – 4.5%; Hops, Alfalfa pellets – 0%

    Chapter 13 – Various Gums, Saps, & Pectins – 4.5%
    Chapter 14     – Bamboo, Vegetable Plaiting Materials – 4.5%
    Chapter 15     – Glycerol 9%; Olive oil – 0%;
    Chapter 16     – Sausages, Hams, Other Prepared & Preserved Meats, Sardines, Tuna – 4.5%

    Chapter 17 – Refined Beet & Cane Sugar, Glucose and Fructose Syrups, Non-Chocolate Confectionary – 4.5%

    Chapter 18 – Chocolate ingredients – 4.5%
    Chapter 19     – Cereals, Pastas, Tapioca, Cuscus – 4.5%

    Chapter 20 – Pickled Cucumbers & Mushrooms, Preserved fruits and vegetables – 4.5%; Preserved Peas, Olives, Tomatoes, Fruit Juices – 0%

    Chapter 21 – Coffee Extracts, Yeasts, Sauces, Food Preparations and Ingredients – 4.5%; Tea & Yerba Mate Extracts – 0%

    Chapter 22 – Mineral Waters, Beer, Champagne, Wine, Liquor, Vinegar – 4.5% Chapter 23 – Livestock Feed 12%; Pet Food – 4.5%
    Chapter 24     – Tobaccos 12%, Cigarettes & Cigars – 4.5%
    Chapter 41     – Hides, skins, and leather – 4.5%

    Chapter 51- Wool – 4.5%, Yarn – 3.0%

    Chapter 52 – Raw Cotton – 12%; Carded Cotton and cotton waste – 4.5%; Cotton thread and yarn – 3.0%

    — By Benjamin Boroughs, USDA Foreign Agricultural Service

  • Costa Rican Orange Production Declines (Major Juice Importer)

    Costa Rica’s orange production is forecast to decline to 285,000 metric tons (MT) in Marketing Year (MY) 2020/2021. It is expected to reach 290,000 MT in MY2019/2020. Delays in the harvest caused by the COVID-19 pandemic resulted in loss of fruit at the time of harvest during MY2019/2020. The industry had to make considerable investments in the application of sanitary protocols and new infrastructure to limit the spread of the disease among workers. Most of these measures are now in place for the upcoming harvest. Many of the workers come from Nicaragua for the harvest. The industry has worked closely with the local authorities to allow workers to enter Costa Rica under strict sanitary protocols. The United States is Costa Rica’s main destination for its orange juice (purchasing 75 percent of total exports in 2019), followed by the European Union, and China. Costa Rican orange juice enters the United States duty free under the U.S.-Central American Free Trade Agreement. 

    COSTA RICA: ORANGE JUICE PRODUCTION AND TRADE

    Costa Rica’s orange production is concentrated in the northern part of the Alajuela province, around Los Chiles, Guatuso and Upala, and in the northern part of Guanacaste, near the border with Nicaragua in an area known as Santa Cecilia. Two companies, TicoFrut and Del Oro, control most of the production and 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. 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. In addition, there are some medium and small size independent producers. While the larger operations have been stable and plan their activities with a long-term horizon, the smaller independent producers tend to enter or exit the market in response to short term price fluctuations. The harvest takes place mainly from January to May, with peak production reached in March and April. The majority of the oranges produced in Costa Rica are processed for juice concentrate for the export market. A relatively small volume of fresh fruit is sold for local consumption, and the processing plants also sell small volumes of juice to local clients.

    One of the two processing companies has orange plantations in Nicaragua, near the border. Growing conditions are favorable in that area, and land prices and labor costs are generally lower. The local industry has partnered with Nicaraguan businesses to plant orange groves in Nicaragua. The area planted is not expected to grow significantly in Nicaragua or Costa Rica at this time, as the company prefers to improve its current operation through replanting and investments in irrigation. This company has a plan to increase area planted slowly. According to the plan, the company will increase area by 230 hectares next year. According to data from the Government of Costa Rica, the country imported 56,644 MT of fresh oranges from Nicaragua in 2019, compared to 71,907 MT during 2018. Imports from Nicaragua during 2020 reached 69,800 MT through October. Oranges from Nicaraguan plantations are trucked to Costa Rica for processing at TicoFrut’s plant located in Muelle, San Carlos.

    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. The Government of Costa Rica estimate is slightly higher at 23,000 ha. However, there is unconfirmed information indicating that the Del Oro company may be reducing its area planted as a result of citrus greening disease. So, at this time, total area could be even lower than the 21,000 ha. estimate.

    The number of trees is gradually increasing as farmers are renovating their plantations with the “Flying Dragon” pattern, which allows for a higher number of trees per hectare, easier farm management and lower associated costs. The “Flying Dragon” pattern is planted at 830 to 900 trees/ha, as compared to a range of 312 to 444 trees/ha for other varieties. As this pattern takes hold, the number of trees should increase in the next few years, as producers replant or renovate their farms using this variety. The main producers are renovating older plantations with new trees, rather than increasing area planted. This process is expected to result in higher future production, without major changes in total area planted.

    The citrus greening disease, which was identified in 2011 in Costa Rica, remains a major concern for producers and has put a limit to the expansion of the industry because of the uncertainty it creates among growers. According to industry sources, the disease has now spread throughout most of the country’s growing areas. The disease is difficult to manage, as it increases production costs, which could result in losses. So far, the largest grower has been able to contain the disease by establishing strict controls including constant farm surveillance, inspection of all farms, and eradication of 100 percent of the affected plants. The local industry uses agrochemicals and biological controls (a wasp that feeds on the vector of the disease, called Tamarixia Radiata), as part of their preventive measures. Although the disease has not caused significant losses to the largest producer, one of the major companies has reportedly suffered more from the effects of the disease, which has resulted in reduced or abandoned areas. Small producers have suffered heavier losses from its effects as well.

    Total production is forecast to decrease by 5,000 MT in MY2020/2021, to 285,000 MT. The lower expected production is related to the strong rains that affected some of the production areas during the flowering period. Also, due to the lower availability of workers during the early stage of the COVID-19 pandemic, some of the agronomical activities normally conducted to assist the plantations during the flowering period, were not carried out on time. The COVID-19 pandemic has also complicated farm management. For instance, supervisory visits to the Nicaraguan plantations were suspended because of the closing of the border. Sick workers and their close contacts had to remain under quarantine when there were outbreaks at the farms.

    Costa Rica exports the majority of its orange production as frozen orange juice concentrate, but also exports non-frozen concentrate juice. According to information from the Costa Rican Trade Promotion Board (PROCOMER), during calendar year 2019 juice exports to all destinations amounted to 32,897 MT valued at $50 million. This compares to 36,936 MT valued at $68 million during 2018. Data available for January-October 2020 show a decline in volume and value, reaching 24,894 MT and $41.7 million, respectively.

    The United States continues to be Costa Rica’s main destination for orange juice exports. Exports to the United States reached 19,586 MT valued at $37.7 million during 2019. During the period January – October 2020, exports to the U.S. amounted to 17,449 MT valued at $34.8 million. The main destination in the European Union is the Netherlands. Exports to that country in 2018 were 7,954 MT, 6,774 MT in 2019, and 5,241 MT during January – October 2020. Exports to China fell to 791 MT during January – October of 2020, after reaching a record of 4,209 MT in 2019.

    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

  • China Market Opportunities for California Nectarines

    On March 4, 2020, China announced market access for fresh U.S. nectarines as part of the U.S.-China Economic and Trade Agreement (ETA). This report briefly mentions the market access conditions for U.S. nectarines, discusses several key factors of China’s nectarine market (including import competition), and offers market-entry recommendations to consider when exporting fresh U.S. nectarines to China.

    Product Description & Access Overview

    On March 4, 2020, in accordance with the U.S.-China Economic and Trade Agreement (ETA), China granted official market access for U.S. fresh nectarines from designated counties in California (specifically Fresno, Tulare, Kern, Kings and Madera counties). California nectarines account for 95 percent of U.S. production. The harvest season for U.S. nectarines runs from mid-summer to mid-autumn, partially overlapping with Chinese domestic supply, which runs from May to October. Read the full report from the USDA Foreign Agricultural Service HERE