Global Outlook 2019 IEG Vu
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IEG Vu Global Outlook 2019
IEG Vu
Contents
06 US pistachios will see rising prices despite 51 Beef industry shrugs off criticism and maintains growth
US-China trade war
54 Wheat market at a turning point
10 All eyes on Turkish hazelnuts and the lira
57 Brexit: EU and UK grains and oilseeds
14 Unavoidable global Thompson raisin shortage? 58 Global canola/rapeseed supplies to tighten in 2019
18 Pepper prices still falling despite restructuring 62 Palm oil ends 2018 on multi-year lows amid bulging stocks
20 Orange juice slowly falls out of global favour 66 Cocoa Review for 2017 and Outlook for 2018
26 Apple juice 2018: China sidelined and Poland triumphant 68 African supplies depress the cocoa market
30 The scourge of sugar in sweet juices 70 World coffee market faces huge surplus in 2018/19
34 Poorer market uptake drives skipjack prices down 73 The impact of trade disputes and policymakers on the
sugar industry in 2018
36 Turbulent year for processing tomatoes
75 World sugar production to fall further in the
39 Thai canned pineapple: How long a buyers’ market? 2018/19 season
42 Frozen strawberry and raspberry facing headwinds 78 The global sugar balance outlook to 2030
45 Global processing potato market wrapped in 82 Light at the end of the tunnel for SMP, as intervention
weather-driven difficulties sales dent stockpile
48 All eyes on Asia as ASF shakes up pork markets 84 Global butter and cheese exports rise to new highs
Agribusiness Intelligence | Informa UK Ltd. | Christchurch Court | London EC1A 7AZ | UK
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News Analyst: Dairy News Analyst: Dried Fruit & Nuts/Spices & Exotics
Jana Sutenko Jose Gutierrez © Informa UK Ltd 2019
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Email: jana.sutenko@informa.com Email: jose.gutierrez@informa.com
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www.ieg-vu.com IEG Vu | Global Outlook 2019 / 3
IEG Vu Unholy trinity of factors conspires to upset trade Politics, exchange rates and weather have been the three major influences on processed fruit and vegetable production and trade this year. The political situation was already complicated, what with western sanctions on Russia and Russia’s riposte in the form of embargos on a wide variety of agricultural products from both Europe and the US. This year saw the outbreak of a full trade war between the US and Europe, the US and Russia, the US and China and President Trump, instigator of most of the hostilities, also tore up the agreement that would lift sanctions on Iran. It is not for IEG Vu to analyse the rights and wrongs of the demands and posturing of any of the parties involved: the situation exists and the industry has to live with it. Political issues have led to financial problems. The Turkish lira has bounced up and down like a football, and the comparison is valid because Turkey finds itself being kicked between the US, Russia and now Saudi Arabia. It has made life extremely difficult for both buyers and sellers of Turkish dried fruit and nuts. The UK pound remains weak because of the uncertainty over Brexit and as that uncertainty shows no signs of disappearing before March 2019, sterling can probably be relied up to weaken further. South Africa’s inflation rate is pushing up prices of its manufactured products while the rand sinks and key inputs like energy and steel still have to be paid for in US dollars… And weather? In 2017, Poland’s apple crop was devastated by a late spring frost. In 2018, exactly the same thing happened to China. Europe had a long, long heatwave which affected a number of crops, most notably potatoes, and the price of processing potatoes for freezing has soared, chiefly because the potatoes have come out smaller than manufacturers of French fries demand. Greening continues to ravage Brazilian citrus. Most recently, hailstorms have damaged a variety in Chile’s key O’Higgins growing region. So this year’s predictions, made by IEG Vu staff in the various product sectors covered in this supplement are not easy to make. In the past, we are proud that our forecasts have proven extremely accurate. If this year’s volatility means that our forecasts for 2019 may be wide of the mark, we hope you will enjoy this Global Outlook anyway. Neil Murray Principal Analyst: Beverages Agribusiness Intelligence www.ieg-vu.com IEG Vu | Global Outlook 2019 / 5
6 / Global Outlook 2019 | IEG Vu www.ieg-vu.com
US pistachios will see
rising prices despite
US-China trade war
The global pistachio market has been affected by a poor Iranian
crop in 2018, dropping 45,000-50,000 tonnes due to water
scarcity and very far from the peak of 300,000 tonnes in 2007.
The 2019 estimate is not much better, because it is an off-year
for Iran’s nut trees.
By Jose Gutierrez
US growers and processors had to face a demand, especially Chinese, for pistachio The world has not been
trade war with China, but the supply since the 2000s, which has kept prices
shortage has meant they have earned firm. Turkey is set to surpass Iran as the
able to meet demand,
good revenues in this major market due to second main origin: its 2017/18 especially Chinese, for
high prices, despite an estimated fall in (September-August) crop is expected to pistachio since the 2000s
imports. China used to import around 200 reach 210,000 in-shell tonnes. However,
million pounds annually and international Turkey is an important consumer and its
players expected a 50% drop in 2018, but exports are expected to reach only around
purchases were not as low because many 17,000 in-shell tonnes.
Chinese importers used third importer
channels and the domestic demand was In addition, the 2019 Iranian crop will be
not badly affected by the high prices after off, and the Californian on. Therefore, the
the new tariffs. 2019 season is again expected to be
excellent for the US industry. First
The world has not been able to meet conclusion: lucky American growers and
IEG Vu | Global Outlook 2019 / 7
Meanwhile, the Iranian crop is expected to
fall by around 250 mln lbs compared with
the previous season, with California having
to cover a demand of 850 mln lbs. As a
result, the 2018 crop marketing year
would exceed the available supply by
100 mln lbs, Primex added.
Sales
A study of the University of California
estimated that the US pistachio industry’s
losses might total USD384 mln due to
price fall in the long-term after China
imposed tariffs on US edible nuts.
However, this pessimistic forecast has not
proved accurate according to data from
July onwards.
The 2018 pistachio sales started in late
July, ranging from USD4.1-4.15 per lb for
processors in the short-term despite an The US 2018 crop non-EU markets and USD4.20-4.25/lb for
uncertain outlook, not being affected by EU for raw 21-26 extra, according to Mark
Chinese tariffs. estimate was around 971 Benjamin of UK trader Kenkko Corporation.
mln lbs on October 15, But by the end of the harvest, the opening
“Prices will be still firm at the end of the 60.5% more than in 2017 price was set at USD3.70/lb for non-EU
year and in 2019. The global acreage is and USD3.80/lb for EU until October 4,
close to matching the global demand, However, first, 50 mln lbs will be needed according to Primex. “As a result, most
but the Iranian crop fall is creating a to fill current empty supplies and around packers did not participate fully at the first
supply shortage of around 100-200 mln 180-200 mln lbs may be held as carry- round of tenders owed to discounts and
lbs,” Ali Amin of the US company Primex over stock for the next season. large supermarkets covering its annual
International Trading Corporation told demand,” Amin explained. “A lot of
IEG Vu. Shipments to Hong Kong, China and demand was covered by the Wonderful
Vietnam were close to 200 million lbs in variety at the opening prices, current
The US 2018 crop estimate was around 2017. Many international players forecast prices ranging from USD4.0-4.1/kg.”
971 mln lbs on October 15, 60.5% more a 50% drop in Chinese demand, down
than in 2017, California accounting for from 200 mln lbs. The amount covered at It is estimated that the industry
99% of the total volume. Primex estimates the opening price indicates that China’s committed a good volume during the
that there are around 750 mln lbs demand would exceed the estimated 100 first three weeks of October, leaving
available to cover 2018/19 demand. million lbs. 40-50% of uncommitted supply available
estimated world pistachio production (in-shell, metric tonnes)
2017/18 2018/19
Beg. Stock Crop Total Supply End. Stock Beg. Stock Crop Total Supply End. Stock
The US 115,507 274,757 390,264 43,084 43,084 437,188 480,272 113,379
Turkey 50,000 50,000 100,000 5,000 5,000 232,000 237,000 87,000
Iran 3,000 225,000 228,000 30,000 30,000 60,000 90,000 5,000
Syria 0 17,000 17,000 0 0 20,000 20,000 0
Afghanistan 0 10,000 10,000 0 0 5,000 5,000 0
Greece 500 4,000 4,500 0 0 4,500 4,500 0
China 0 1,200 1,200 0 0 4,200 4,200 0
Italy 0 2,250 2,250 0 0 2,500 2,500 0
Australia 0 2,000 2,000 0 0 2,000 2,000 0
World Total 169,007 586,207 755,214 78,084 78,084 767,388 845,472 205,379
World Consumption 677,230 640,093
Source: INC
8 / Global Outlook 2019 | IEG Vu www.ieg-vu.com
for the remaining 10 months left to the The pistachio producer added there is a East fell to 3.3 mln lbs, down from
2019 crop. credit for re-exported product, but his 8.5 mln lbs.
understanding is that the duty applies
There has also been a wide range of prices both to product shipped directly to China The prices were stabilised in November, but
with whole kernels at USD6.90-7.20/lb, as well as that going through Hong a price rise was expected when the Iranian
halves and splits (large pieces) from Kong. Moreover, he explained that during supply finished around February 2018.
USD5.30-5.40/lb and small pieces from the 2016/17 marketing year, 201 mln lbs
USD5.0-5.1/lb. were shipped from the US to Hong Kong, Primex quoted that prices for California
and only 12 mln lbs from the US directly raw in-shell range from USD4.30-4.40/lb
What happens with the available Iranian to China. Hence, the total value for both fca/fas for 20-22 extra no. 1; USD4.00-
product? “Iranian pistachio prices have destinations is around USD750 mln: 4.10/lb for 21-26 extra no. 1;
increased and are now at USD0.20/lb to massively above the USD39 mln USD3.20-3.3.0/lb for closed shell on
USD0.40/lb premium to California indicated earlier and based on statistics November 27. Pistachio kernel prices range
pistachios. Most of the available supplies for direct to China only. from USD7.25-7.70/lb for whole and from
of Iranian pistachios will go to markets USD6.40-6.50 for halves and splits (large
that have a definite preference for Iranian One US pistachio pieces). In addition, Iranian 30-32 was at
varieties and are willing to pay more for
producer raised doubts USD8,800/tonne in October.
them,” Amin added.
over initial reports “The more luxurious varieties, such as
Amin said that prices would be USD9,050/ Ahmad Aghaie and Akbari 22-24, are over
tonne for California 21-26 and USD8,800/ US shipments and prices USD10,200/Mtonne in November. Following
tonne for Iranian 30-32 and over California pistachio shipments totalled these indications, a price rise is expected
USD10,200/tonne for Ahmad Aghaie and 133 mln lbs in September-October 2018, after Iranian pistachio supplies are depleted
Akbari 22-24. 3.6% more than in the same period in the by February of 2019. Benjamin estimated
previous year. Domestic and international that the industry left 40-50% of
One US pistachio producer raised doubts demand worked well, confirming the uncommitted supply available for the
over initial reports. “For years, when optimistic forecast for US growers. remaining 10 months left to 2019 crop.
duties into China were significantly higher, Domestic shipments were stagnant at 41
pistachios were smuggled into mainland mln lbs and exports increased by 6% to So, the general recommendation is: “If you
Tradecos_AvisoFoodNews.pdf 1
China through Hong Kong. Not brought in12/26/16 11:46 AM
92 mln lbs. Asian imports increased by have an accurate requirements plan, cover
duty free,” he recalled. 19% to 60 mln lbs although the Middle sooner than later.”
www.ieg-vu.com IEG Vu | Global Outlook 2019 / 9
All eyes on Turkish
hazelnuts and the lira
If Turkey sneezes, the world’s hazelnut industry catches a cold,
and the country has suffered a nasty combination of weak
national exchange, high interest rates and a trade conflict with
the US. As a result, prices are stable in liras but unsteady in US
dollars and all international players are taking short positions and
not building stocks.
By Jose Gutierrez
Italian Ferrero, the largest The last hazelnut market season was A UK trader noted that, based on the local
pretty stable, after Turkish farmers sold price and exchange rates, raw 11-13 mm
hazelnut purchaser, most of their crop over the September- levants market quality in jute sacks were in
started negotiations with December period. A lot of this had been the region of USD5,700 per tonne c&f
Azerbaijani and Georgian purchased by the Turkish Grain Board Europe in January.
(TMO) and some major processors.
growers, planning to Georgia and Azerbaijan 2018 merged as
acquire a plantation in Several sources told IEG Vu in January 2018 complementary markets to Turkey. Their
the latter country that they were surprised after experiencing crop reached 80,000 and 65,000 in-shell
volatile pricing in previous three or four tonnes, respectively: not enough to affect
years, leading all international players to Turkish business. Italian Ferrero, the largest
take short positions. hazelnut purchaser, started negotiations
with Azerbaijani and Georgian growers,
Adam Johnston, of the UK company planning to acquire a plantation in the
Freeworld Trading, told IEG Vu that latter country.
farmers were quite relaxed. “They don’t
feel any real pressure to sell. They are OK The following months saw local prices
with the prices they see in the market at fall gradually due to the lower quality of
the moment and are not under any the remaining inventory. There were
pressure to sell stocks.” limited offers at TRY20/kg for raw 11.13
mm kernels: most buyers in February
Fluctuations in the exchange rate were domestic. The price for 11.13mm
between the Turkish lira and the US dollar levants market quality was USD5,900/
were the main influence on general tonne c&f Europe in jute sacks gross
market prices. weight in February.
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Booth S3-A42TMO still had stocks to put back and the These deep changes broke analysis
Turkish lira weakened against the US dollar fundamentals and nobody was able to
and euro. In addition, the Turkish exporter predict price trends. And, needless to say,
union’s first new crop estimate was 647,000 the TMO had no solid pillars to establish a
in-shell tonnes, lower than in the previous pricing policy.
season but still an average crop.
Prices given by exporters for the 2018 crop
In spring, the Turkish president announced range from TRY11.25-11.50 per kilo
that presidential and parliamentary in-shell and from TRY22.5-23.00/kg for
elections, originally scheduled for 2019, kernels, the 2017 crop being still available
would take place on June 24. Traditionally, at TRY20.5/kg. The first prices from Georgia
the market reacts quickly to changes in and Azerbaijan were considerably higher in
TMO’s policy to fulfil electoral promises or US dollars in the second half of August.
governmental changes once elections have
taken place. However, prices were which meant TRY24.00/kg for 11-13s. Turkish hazelnut was steady and the new
unchanged in lira terms at TRY20.5/kg, the Several sources revealed that price crop price was TRY26/kg (USD4.4/kg)
fall in US dollars or euros being due to the indications on the forthcoming 2018 crop kernel at the end of October while the lira
weak Turkish currency. showed a USD500-700/tonne premium was stable at around USD5.8 per US dollar.
over 2017 crop. The price indications for new crop 11-13
The 2018 crop estimate ranges between mm levants were around USD4,920/tonne
550,000-640,000 in-shell tonnes and Trade conflict c&f Europe for 2018 crop.
plenty of available TMO’s stocked product The political tension between Turkey and
led to limited offers of 2018 crop. “The the US in the first week of August, due to “Nobody in Turkey was able to calculate
Turkish government no longer publishes the trial of a US pastor, led to US the dollar price because when they do a
an estimate but there is one relevant retaliatory tariffs on Turkish steel imports, deal, they don’t know at what price they
fact: there is enough supply and all the steepening the fall of the lira, which had are going to get the dollars changed back
players know that,” one UK trader told fallen over 33% since the beginning of the to. So they were taking a profit margin
IEG Vu. year. In addition, Turkish banking was very that was covering the risk of change,” the
weakened and loans in US dollars were UK trader explained.
The situation remained unchanged after restricted. Processors from Georgia and
the end of Ramadan (June 14). The new Azerbaijan tried to keep pace with these Change of TMO’s criterium
crop was developing well and nobody trends, maintaining their offers below In the third week of October, the Turkish
expected that the TMO would make a those from Turkey. government announced that the TMO
radical policy change. would pay TRY14.0 (USD0.18) per in-shell
The Turkish lira hit a low of TRY7.2 to the kilo for the Levant variety and TRY14.5/kg
Kernel prices for the 2018/19 season were US dollar and this put the brakes on Turkish for Giresum from November 1 onwards,
TRY2.00/kg up from those of 2017/18, hazelnut offers. fulfilling some of its electoral promises in
Estimated Hazelnut Production (in-shell, tonnes)
2017/18 2018/19
Country Beg. Stock Crop Total Supply End. Stock Beg. Stock Crop Total Supply End. Stock
Turkey 80,000 750,000 830,000 170,000 170,00 640,000 810,000 110,000
Italy 15,000 90,000 105,000 7,500 7,500 115,000 122,500 10,000
Georgia 1,000 80,000 81,000 5,000 5,000 80,000 85,000 5,000
Azerbaijan 500 65,000 65,500 7,500 7,500 70,000 77,500 5,000
The US 3,500 27,000 30,500 0 0 50,000 50,000 2,500
Chile 0 25,000 25,000 0 0 25,000 25,000 2,000
Spain 1,000 19,000 20,000 1,000 1,000 16,000 17,000 1,000
Iran 500 12,000 12,500 0 0 12,000 12,000 0
China 0 6,000 6,000 0 0 9,000 9,000 0
France 0 4,500 4,500 0 0 4,500 4,500 0
Others 0 25,000 25,000 0 0 26,000 26,000 0
World Total 101,500 1,103,500 1,205,000 1,191,000 191,000 1,047,500 1,238,500 135,500
World Consumption 1,014,000
Source: INC
12 / Global Outlook 2019 | IEG Vu www.ieg-vu.comthe last elections. Before the and “at the end of the day, traders are exporter consortium (AHEC), Ismayil
announcement, the private market was specialists in international trade rules, Orujov, told IEG Vu.
paying between TRY25.75-25.25/kg for raw quality product, etc but not in playing with
product. As a result, the price jumped to exchange rates,” as Richard van Helden of Orujov reported that average prices from
TRY27.5-28.0/kg for graded kernels, up 6% the Dutch trader QFN told IEG Vu. farmers for local market were AZN4.40/kg
from the level prior to the announcement, (USD2.58/kg) for in-shell Khachmaz
10% compared with mid-October and Georgia and Azerbaijan are different cases. variety and AZN3.60/kg (USD2.11/kg) for
23.5% from August. The demand was Van Helden explained that the 2018 in-shell Atababa. The export price for raw
moderate because many manufacturers Georgian crop was of very low quality due to hazelnut kernels 11/13 Atababa was
were waiting to check if the lira was able pests and its industry is trying to compete USD5.50/kg in November.
to sustain its gains. with Turkey via low prices. On the other
hand, Azerbaijan has sold most of its crop to “The Azerbaijani market has reacted to the
“TMO has plenty of 2017 crop stocks so it Russia and its prices are higher on average. lira’s appreciation, not really to TMO’s
is not likely to acquire over 20,000 tonnes policy. However, the reaction took place
of the 2018 production. From my point of “From the beginning of the 2018/19 several weeks after Turkey fuelled
view, prices will be stable in liras,” the UK hazelnut season until now, Russia was the international prices. Azerbaijan is more
trader explained. main importer of Azerbaijani hazelnuts influenced by imports of neighbouring
because major European buyers, mainly markets such as Russia than by global
The Turkish market is reminiscent of Ferrero, delayed their buying offers, ,” trends,” Orujov concluded.
Argentina’s last debt and exchange crisis, the director of the Azerbaijan hazelnut
We expect a slight increase in Turkish
product prices in 2019, due to stronger
Turkish
Turkishhazelnut kernel Prices,
Hazelnut Kernel prices, 2018
(USD/tonne)
(USD/fob) demand in the US after the 2018 Oregon
crop dropped by 46,000-48,000 (short)
8,000 tons from an initial estimate of 52,000
7,500 tons. However, everything will be
dependent on the Turkish lira value
7,000
against the US dollar. Again…
6,500
6,000
5,500
5,000
4,500
4,000
3,500
26/11/2018
12/11/2018
29/10/2018
15/10/2018
01/10/2018
17/09/2018
03/09/2018
20/08/2018
06/08/2018
23/07/2018
09/07/2018
25/06/2018
11/06/2018
28/05/2018
14/05/2018
30/04/2018
16/04/2018
02/04/2018
19/03/2018
05/03/2018
19/02/2018
05/02/2018
22/01/2018
08/01/2018
raw 11/13 mm, c&f Europe levants standard 1, 13/15, exw UK
Source: IEG Vu
1 vs. 7.5 ◆ One Goodpack MB5 holds 1,500 liters vs. one
200-liter drum
◆ It takes 7.5 drums to equal the capacity of one
Goodpack MB5
◆ 6,000 liters per pallet space with Goodpack vs. 2,400
liters with drums
◆ MB5s have 90% more efficient empty storage vs. drums
www.goodpack.com
www.ieg-vu.com IEG Vu | Global Outlook 2019 / 13Unavoidable global
Thompson raisin
shortage?
The global dried vine fruit market has faced a blurred scenario in
2018, facing a combination of lower crops in main exporting origins
such as California and Turkey and strong exchange fluctuations in
Turkey and Argentina, both important exporting markets.
By Jose Gutierrez
The 2018 global dried vine fruit market has India, China and Iran are expected to reach
The global supply been characterised by three key points: a 284,000 tonnes. However, China and India
shortage will continue, fall in the US Thompson supply, rising prices are set to consume most domestic
especially for Thompson and the weakening of both the Turkish lira, production and Iran has to face US
due to its high debt ratio and US tariffs, and sanctions. Emerging exporters such as
raisins, due to smaller the British pound, due to Brexit Argentina, Chile and South Africa expect to
crops in California negotiations. Turkey is the largest global enjoy higher production due to favourable
and Turkey raisin and sultana supplier and the UK the weather and of course, to take advantage
main importer of Turkish product and a key of rising prices.
European consumer.
Argentina
The updated data shown at the Argentina’s vineyard area totalled 220,000
International Seedless Dried Grape hectares in 2017. This acreage has
Producing Countries, held in Windsor (the experienced a gradual fall since 2011 due
UK) on October 26, revealed the global to the high percentage of trees over 15
supply shortage will continue, especially for years old; 65% of the total. The area of San
Thompson raisins, due to smaller crops in Juan is the largest raisin origin, its growing
California and Turkey, both main global area totalling 16,800 hectares.
exporters. However, the world’s available
product estimate was around 1.15 million Carlos Huertas, director of the raisin
tonnes, 3.6% more than in 2017. Crops in processor and exporter Frutandina, noted:
14 / Global Outlook 2019 | IEG Vu www.ieg-vu.com“There will be an area fall because many are leaving grape production,” Camilo respectively. However, Chilean exporters
small growers will leave their plantations Rosales, export manager of the dried fruit are increasing their market share in Asian
due to high-interest rate credits in and nut exporter Natural Chile, noted. countries due to their growth potential
Argentine pesos after the IMF’s and profitability.
intervention. However, I am optimistic The export average price increased by
about the long-term trend because the 10.8% to USD2.26 per kilo fob for dark The 2018/19 crop is expected to reach
area of San Juan now has a new dam and raisins and by 7.1% to USD4.5/kg in between 61,000-67,000 tonnes, flame
plenty of water and electricity.” H1 2018, compared with average prices variety accounting for 67.6% of the total.
in 2017.
The 2018 raisin crop totalled 52,000 South Africa
tonnes, 70% more than in 2017, when The main importers are the EU and the US, The 2018 South African dried vine fruit crop
production suffered severe frosts. Flame, with a market share of 42% and 18%, reached 71,072 tonnes, 8% more than in
Thompson, Arizul, Fiesta and Superior
varieties accounted for 51%, 15%, 14%, Thompson Seedless
seedless Raisin
raisin prices,
Prices, cif
cif UK
UK (USD/tonne)
(USD/tonne)
12% and 8% of the total crop, respectively.
4,000
Exports totalled 48,000 tonnes worth
3,800
USD92 million, 97% more. South American
countries accounted for 67% of the total 3,600
exports and the US for 25%. 3,400
3,200
The 2019 crop estimate is similar to
2018’s production due to lack of frosts 3,000
and hailstorms.
2,800
Traditionally, Chilean
2,600
processors had to
2,400
compete with the wine 2,200
19/11/2018
05/11/2018
22/10/2018
08/10/2018
24/09/2018
10/09/2018
27/08/2018
13/08/2018
30/07/2018
16/07/2018
02/07/2018
18/06/2018
04/06/2018
21/05/2018
07/05/2018
23/04/2018
09/04/2018
26/03/2018
12/03/2018
26/02/2018
12/02/2018
29/01/2018
15/01/2018
01/01/2018
industry for raw material
Australia South African Origin Californian Origin
The 2018 dried vine fruit crop totalled
17,000 tonnes, 30.7% more than in
Source: IEG Vu
2017, sultanas accounting for 48.4%,
sun muscats for 16.3% and currants for
World Sultana and Raisin Supply 2018 (tonnes packed weight)
10.4%. The producing areas are the
southern states of South Australia, New Country Estimated Estimated Estimated Total estimated
physical stock production Northern production Southern available
South Wales and Victoria. Australian
31/08/2018 Hemisphere Hemisphere product for
exports are expected to reach 4,876 tonnes 1/10/2018 28/02/2018 marketing
in 2018, 31.5% more, mainly to Germany,
Greece 2,000 2,000
Italy and Vietnam.
Iran 80,000 80,000
Chile Turkey 25,000 261,000 286,000
Traditionally, Chilean processors had to USA 68,000 210,000 278,000
compete with the wine industry for raw
Indıa 140,000 140,000
material, restricting its grape varieties,
although growers are modernising their Uzbekistan 45,000 45,000
plantations and focusing on beverages and China 190,000 190,000
fresh and dried product.
Argentina 1,000 52,000 53,000
The 2018 raisin crop totalled 56,000 Australia 15,468 15,468
tonnes, 15.7% less than in the previous Chile 5,000 48,000 53,000
season. This fall was due to a quick
South Africa 51,000 51,000
transition in the Chilean grape production,
moving into new seedless and more Total 99,000 928,000 166,468 1,193,468
productive varieties. 2017 117,916 883,461 153,000 1,154,377
% Difference -16% 5.00% 8.80% 3.40%
“These new varieties have higher
Source: International Seedless Dried Grape Producing Countries Conference
production costs and many small growers
www.ieg-vu.com IEG Vu | Global Outlook 2019 / 15last year, due to a better dam capacity 20.3% less than in the previous year and
level. Thompsons accounted for 58.0%, the smallest crop of seedless raisins in
Goldens for 35.2%, sultanas for 3.4% and recent years. The Thompson variety
currants for 3.3%. Exports are expected to production totalled 190,741 tons,
account for 85% of the total crop. 21.5% less. The 2018 crop is expected to
reach a similar figure, continuing the
The 2019 crop is expected to be slightly supply shortage.
lower than in 2018, although it expects
notable growth in 10 years due to the In addition, Chinese retaliatory tariffs have
intense vineyard renewal, exceeding caused a 37% increase in the base price to
90,000 tonnes. importers and consumers alike, making it
difficult to run any kind of trade or
“South African growers are consumer promotion.
modernising their orchards China, India and Iran
and we are optimistic” The 2018 Chinese crop is expected to
reach 190,000 tonnes, of which 30,000
Ferdie Botha and Dappie Smit of the South tonnes will be exported. Meanwhile, India
African Dried Fruit Technical Services is expected to reach 140,000 tonnes and
explained: “South African growers are export 20,000 tonnes. Finally, Iran is
modernising their orchards and we are expected to reach 80,000 tonnes,
optimistic, although we have several exporting all its production.
challenges such as the land reform and
climate change.” gradual recovery and the British pound’s However, they have not managed to
weakening due to Brexit negotiations have alleviate the Californian and Turkish
Turkey made life difficult for exporters. shortages, due to commercial sanctions
Turkey exported 280,000 tonnes of dried against Iran and MRLs and phytosanitary
vine fruit in 2018, a record and 3.7% more The US controls in the EU.
than in the previous season. However, the The Californian industry has almost
2018/19 crop is expected to drop to completed its removal vine programme, Our forecast for 2019 season is a price
260,000 tonnes and exports to 235,000 totalling 150,186 hectares of raisin increase of around 15-20%, based on the
tonnes, adding pressure to the global plantings and has automated 50% of continual global supply shortage and
supply shortage, especially in the UK, its harvesting due to labour shortages and expected Turkish crop fall. However, it
main importer. In addition, the sharp fall rising minimum wage rates. The 2017 crop would be necessary to analyse H1 2018
in the value of the lira last summer and its totalled 218,236 packaged (short) tons, data to project a more solid forecast.
World Golden and Currant Supply 2018 (tonnes packed weight)
Country Estimated Goldens Estimated Total estimated Estimated physical Currants Total estimated
physical stock Production 2018 crop available product stock 31/08/2018 Estimated available product
31/08/2018 for marketing production for marketing
2018 crop
Greece 0 16,000 16,000
Iran 25,000 25,000 0
Turkey 0 0 0
USA 18,000 18,000 1,500 1,500
Indıa 0 0 0
Uzbekistan 0 0 0
China 0 0 0
Argentina 0 0 0
Australia 0 0 0 1,069 2,092 1,841
Chile 8,000 8,000 0
South Africa 800 17,000 17,000 800 2,000 2,000
Total 800 68,000 68,000 1,869 21,592 21,341
2017 5,111 64,718 44,829 2,485 28,421 20,905
% Difference -84% 5% 52% -25% -24% 2%
Source: International Seedless Dried Grape Producing Countries Conference
16 / Global Outlook 2019 | IEG Vu www.ieg-vu.comBeverages
that bear
fruit.
We are one of the leading manu-
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info@austriajuice.com
austriajuice.comPepper prices still falling
despite restructuring
The global pepper industry closed 2017 with a 50% price fall
compared with 2015 and dreaming of a price hiccup in 2018 or,
at least, stabilisation after having dropped from around USD3,000-
3,100 per tonne fob in December. However, the oversupply from
Vietnam and Brazil was a stubborn background.
By Jose Gutierrez
The global pepper crop reached 488,000 due to favourable weather and a larger
tonnes in 2017, 13.9% more than in 2016, yield of the younger vines, according to
and exports totalled 389,000 tonnes, Nedspice. The Brazilian production was
20.9% more, both exceeding all previous expected to increase by 26.1% to 82,000
estimates, according to the International tonnes. The only origin which expected a
Pepper Community (IPC). fall was China, dropping 35,000 tonnes,
8.5% less. As a result, average prices
Despite the price fall, Vietnam and Brazil ranged from USD2.60/kg fob to USD3.0/kg
increased their 2017 export values due to fob between March and May.
their volume growth. Vietnamese exports
increased in value by 21% to USD1.2 billion An updated estimate steepened the price
while those of Brazil gained 12% to USD277 fall in summer. The 2018 Indian production
million. Vietnam exported 222,000 tonnes, was expected to reach 92,000 tonnes.
24% more than in 2016, and Brazil 62,000 Indonesian was expected to reach 45,000
tonnes, 92% more, according to the Dutch tonnes. Nedspice quoted Indonesian
trader Nedspice. Lampung fair, average quality (faq) 550 g/l
black pepper at USD2,720/tonne fob;
Cambodia underwent major changes in its Vietnamese faq black pepper of 550/g at
position in the world market, its crop USD2,650/tonne fob; and Brazilian faq 550
reaching 20,054 tonnes in 2017, up from g/l at USD2,425/tonne fob in July.
1,450 tonnes in 2011. Most Cambodian
production is organic, bought by Vietnamese Heavy rains due to monsoons impacted
importers to mix it with domestic product pepper harvesting in the Indian states of
and reduce its pesticide levels in order to Vietnamese black pepper average prices fell Kerala and Karnataka, which account for
meet European and US requirements. from VND71,000-72,000 per kilo (USD3.11- around 90% of the total domestic crop.
3.16 /kg) in December 2017 to VND70,000/ The Indian Institute of Spices Research
Indian growers suffered a crop fall due to kg in January 2018. (ISSR) estimated that cropscould drop to
severe droughts and they convinced their 45,000-50,000 tonnes, very far from the
government to use pesticide on imported The initial 2018 production estimate was previous forecast of 90,000 tonnes. The
pepper and, finally, a minimum price of released in spring. Again, a crop increase combination of crop declines in China and
INR500/kg (USD6.95/kg) on imported was set to fuel price falls. The 2018 global India might temper the price fall but not
pepper in December, after claiming cheap pepper crop was expected to reach reverse it due to the Brazilian and
Vietnamese product was re-exported 575,000 tonnes, 17.8% more, and the Vietnamese production forecasts.
throughout Sri Lanka. This pushed down carry-over stock to 399,000 tonnes,
the local production price taking according to the European Spice Brazilian prices enjoyed a brief fillip in the
advantage of the South Asia Free Trade Association (ESA). This crop was set to second fortnight of October due to
Agreement (SAFTA), signed by India, exceed consumption by 120,000 tonnes. uncertainty about results and the
Bangladesh, Sri Lanka, Bhutan, Pakistan consequences of Bolsonaro’s victory at
and Maldives. Vietnam’s crop was expected to reach presidential elections. Brazilian product
218,000 tonnes, up 8,000 tonnes from reached USD2,500/tonne for Asta graded 1
Vietnam led global price trends. 2017 despite a 19% fall in its growing area, ranged and USD2,400/tonne, following
18 / Global Outlook 2019 | IEG Vu www.ieg-vu.comfirmer prices in Vietnam. Brazil’s average Malaysian exporters to keep stocks to wait demand of 474,000 tonnes, 2.1% more,
price reached USD3,000/tonne for ASTA good offers, the price being over USD3,600/ according to Nedspice. The 2019 global
grade 1 in June, fell to USD2,600-2,700 in tonne cif,” Kai Jantzen of Hamburg trader stocks may total 517,000 tonnes.
July and enjoyed an increase in the end of Jantzen & Deeke told IEG Vu.
August, at around USD2,400/tonne, “The over-production will cause global
according to Juliano Camara, director of The global 2019 pepper crop was stocks to increase further and it will likely
the Brazilian broker Coreimex. upgraded again at the China Spice take some time before supply lines up
Conference, held in Wuanxi (China) from with demand again, resulting in
However, Brazilian prices started to fall in October 31 to November 2. continuous downward price pressure,”
November, as did most origins. The only Nedspice explained.
exception was the Malaysian Sarawak black The 2019 global stocks may total 517,000
label pepper, much appreciated in Far Eastern tonnes. The 2019 pepper production is “Prices are already close to or below
markets. “It did not suffer as deep a fall as expected to reach 612,000 tonnes, 11% production costs in many countries, so the
other origins and its scarcity encouraged more than in 2018, against an international struggle for farmers who concentrate on
Black Pepper Prices Weekly, cif nw Europe (USD/tonne) pepper may harden.”
Black pepper prices weekly, cif nw Europe (USD/tonne)
8K
“The over-production will
7.5K
7K
cause global stocks to
6.5K increase further and it
6K will likely take some time
5.5K
before supply lines up
5K
4.5K
with demand again”
4K
As a result, this optimistic pepper crop
3.5K
estimate led to short positions and lower
3K
prices. Nedspice explained that Brazil has
2.5K become the cheapest origin due to its weak
2K currency and selling pressure before the end
10/12/2018
26/11/2018
12/11/2018
29/10/2018
15/10/2018
01/10/2018
17/09/2018
03/09/2018
20/08/2018
06/08/2018
23/07/2018
09/07/2018
25/06/2018
11/06/2018
28/05/2018
14/05/2018
30/04/2018
16/04/2018
02/04/2018
19/03/2018
05/03/2018
19/02/2018
05/02/2018
22/01/2018
08/01/2018
of the year, showing a discount of USD500-
600 per tonne against Vietnamese prices.
“Many Vietnamese exporters were buying
Brazilian product to cover orders. However,
Vietnamese min 550g/l Malaysian Sarawak black label traffic congestion in Brazilian ports is leading
these exporters to buy domestic product
Indonesian, Lam Pong min 550g/l, mach. Cleaned Indian MG 1 grade Brazilian grade 1
again,” Nedspice explained.
Whitepepper
White Pepperprices
Pricescif
Source: IEG Vu cifnw
NWEurope
Europe(USD/tonne)
(USD/tonne) Nedspice quoted the following November
fob prices.
7K
• V
ietnam: USD2,850/tonne for black faq
6.5K 550gl; and USD4,200/tonne for white dw
6K • Brazil: USD2,125/tonne for black faq 550gl,
5.5K
• India USD5,493/tonne for black faq 550gl
5K
• I ndonesia: USD2,820 for black Lampung
4.5K faq 550gl and USD3,920/tonne for white
Muntok, faq,
4K
• China: USD5,000/fob for white faq.
3.5K
10/12/2018
26/11/2018
12/11/2018
29/10/2018
15/10/2018
01/10/2018
17/09/2018
03/09/2018
20/08/2018
06/08/2018
23/07/2018
09/07/2018
25/06/2018
11/06/2018
28/05/2018
14/05/2018
30/04/2018
16/04/2018
02/04/2018
19/03/2018
05/03/2018
19/02/2018
05/02/2018
22/01/2018
08/01/2018
IEG Vu expects a price fall up to the
second half of 2019, when downgraded
crop estimates will stabilise price levels.
However, we do not want to quantify the
Vietnamese min 550g/l Indonesian Sarawak faq Indonesian Muntok White faq percentage because it will be based
largely on Vietnamese and Brazilian
Source: IEG Vu exchange rates.
www.ieg-vu.com IEG Vu | Global Outlook 2019 / 19Orange juice slowly falls
out of global favour
Demand is slowly but surely falling but then so is production.
By Neil Murray
Pity the poor orange juice sellers. Still the changing breakfast habits in the west
lynchpin of the juice industry, have meant that a glass of orange juice is
consumption is stagnating in Europe and now a rare sight in the morning and the
has been in decline in the US for the hope, often expressed at the start of the
better part of a decade. century, that China would be the saviour
of the industry has not happened.
Orange juice has been at the sharp end of
the sugar-in-fruit-juice backlash (mainly “If every Chinese consumer drank just
because it’s the most visible target), one small glass of orange juice a week…”
Brazilian orange
Brazilian orange juice
juice processing yields by
processing yields by box
box
350 6.5
300 5.57
250 4.64
200 3.71
Boxes/FCOJ tonne
Lbs solids/box
150 2.79
100 1.86
50 0.93
0 0
1
2
3
4
5
6
7
8
9
0
1
2
3
4
5
6
7
8
9
/0
/0
/0
/0
/0
/0
/0
/0
/0
/1
/1
/1
/1
/1
/1
/1
/1
/1
/1
00
01
02
03
04
05
06
07
08
09
10
11
12
13
14
15
16
17
18
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
Boxes/FCOJ tonne Lbs solids/box
Source: CitrusBR
20 / Global Outlook 2019 | IEG Vu www.ieg-vu.comMORE THAN PRUNES
started the industry prayer. Well, they The pack from fruit was hugely reduced. Orange juice buyers are sourcing from
didn’t, they aren’t and they probably countries that, hitherto, they would only
won’t. Not for a while, anyway. The inventory for NFC juice, on the other buy from in an emergency. It is worth
hand, had shrunk from 27.3 weeks’ mentioning that the smaller producers are
Production is still endangered due to supply to just 20.5 weeks. The pack from providing, collectively, some reasonable
disease and unpredictable weather. fruit was down by well over one-third to volumes and Europe and the Middle East
Greening is still rampaging through just over 200 mln lbs (320.6 mln lbs) and have not (yet) been affected by the citrus
Brazil’s citrus groves, and Hurricane Irma imports nearly doubled to 99.3 mln lbs diseases that have ravaged the Americas.
slashed Florida’s orange production to (55.0 mln lbs).
below 50 million boxes. There has been a Globally, the availability of fruit for
USD25 million support package for
It looks as if NFC juice has processing is expected to fall, with FCOJ
affected growers in the state, but this production forecast down nearly 25%,
smacks more of a temporary sticking become the core product according to a recent USDA report on the
plaster to tide growers over rather than a for Brazilian processors industry. Fresh fruit exports are relatively
scheme that will actually allow them to unchanged.
invest in growth. The clue to the market situation is in the
word ‘imports’. It looks as if NFC juice has US production is estimated to decline
For all this, it looks as though FCOJ become the core product for Brazilian 24% to 3.5 million tonnes as unfavourable
consumption has been declining faster processors, because (in the major markets weather and citrus greening continue to
than production, because in October, of the US and Europe, anyway) exports are cause fruit drop in Florida.
Florida’s FCOJ inventory was the holding up reasonably well. To a degree,
equivalent of nearly 44 weeks’ worth, US bottlers (the big brands) have managed Brazil’s production is forecast to fall 23%
compared with just under 25 weeks’ to disguise price increases by ‘shrinkflation’ to 16.0 mln tonnes as poor weather
worth at this point in the previous year. – reducing the size of their larger packs. resulted in poor bloom and fruit set. Fresh
orange consumption is up 173,000
tonnes while oranges for processing are
Forecast Brazilian orange production and juice exports (tonnes, FCOJ equivalent)
down 5.0 mln tonnes to 11.1 mln tonnes.
Orange production OJ exports FCOJ juice production is forecast to fall to
Year Forecast Upper limit Forecast Upper limit 1.0 mln tonnes.
2018 16.92 - 2.294 2.550
EU orange production is estimated down
2019 17.043 19.428 2.289 2.578 5% to 6.4 mln tonnes on lower area and
2020 17.167 20.54 2.355 2.702 drought conditions. Imports (which are
more than triple exports) are up 10% while
2021 17.29 21.421 2.387 2.771
oranges for processing and fresh
2022 17.414 22.184 2.436 2.859 consumption are both down.
2023 17.537 22.87 2.477 2.933
Egypt’s production is estimated at a
2024 17.661 23.503 2.521 3.010
record 3.2 mln tonnes, up 6% from last
2025 17.784 24.094 2.564 3.082 year on higher area. Exports are up 5%
2026 17.908 24.653 2.608 3.154 to a record 1.6 mln tonnes on greater
2027 18.031 25.186 2.651 3.224
exportable supplies. Egypt accounts for
one-third of global orange exports.
2028 18.155 25.697 2.694 3.293
Source: Brazilian Ministry of Agriculture Egypt is emerging as an interesting force.
Its leading processors are properly
certified and this summer (its season ends
EU28 orange juice production (65 brix equivalent, tonnes)
in June/July) it sold out of FCOJ and its
2014/15 2015/16 2016/17 2017/18 orange oil was priced around USD8.50 per
Fruit to processors 1,251,000 1,286,000 1,490,000 1,385,000 kilo. Egyptian product is duty-free into
Europe with the EUR1 certificate.
Opening stocks 15,000 15,000 15,000 15,000
Production 97,000 99,693 115,508 107,638 South Africa’s production is expected to
Imports 890,000 777,989 689,209 675,000 rise 8% to 1.5 mln tonnes. Exports are
forecast at a record 1.2 mln tonnes and
Total supply 1,002,000 892,682 819,717 797,368
account for 25% of global trade. The
Exports 50,000 52,065 63,493 65,000 USDA estimates that the 2017 exports of
Ending stocks 15,000 15,000 15,000 15,000 orange juice will increase by 3% to 28,500
Total distribution 1,002,000 892,682 819,717 797,368 tonnes from 27,742 tonnes in 2016, based
on the available supply, increase in
Source: USDA
production and the year-to-date exports
22 / Global Outlook 2019 | IEG Vu www.ieg-vu.comWe
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Email juices@djpl.fr
www.djpl.frup to April 2018. Its estimate of 2017 Mexico’s production is projected down ago, has staged a remarkably recovery.
orange juice exports were revised upwards slightly, which is expected to lower fruit Prodalim, the Israeli company that is
to 27,742 tonnes. used for processing and consumption. pursuing a global aggressive acquisition
policy, has signed a joint venture with
Production in Turkey is forecast at a record Mexico, whose orange juice industry was Jugosa, a Mexican supplier of organic
1.9 mln tonnes due to favourable weather. being written off by pundits a decade or so juices, and this will focus on producing a
wide range of organic NFC juices: orange,
lemon, lime, grapefruit and tangerine, with
Florida processing orange production, utilisation (‘000 boxes) apple in the near future. The products will
FCOJ Chilled Others Total be destined mainly for the North American
1980/81 144,322 19,867 6,353 170,542
and the European markets.
1981/82 105,150 16,518 4,473 126,141
Morocco’s production is forecast only
1982/83 114,627 18,254 2,665 135,546 slightly lower at 1.0 mln tonnes on
1983/84 94,547 16,981 2,909 114,437 favourable weather following early
season drought.
1984/85 86,112 14,903 1,907 102,922
1985/86 96,061 17,267 1,361 114,689 More oranges will also be sent for
1986/87 96,182 19,661 948 116,791 processing. The original forecast was
1987/88 110,206 23,325 904 134,435
for 35,000 tonnes crushed for juice, but
that has been revised to 50,000 tonnes:
1988/89 113,732 29,902 1,141 144,775
the same volume as in the previous
1989/90 73,640 33,836 659 108,135 season. This equates to around 4,100
1990/91 104,136 38,387 568 143,091 tonnes of orange juice (FCOJ 65 brix
equivalent, though Morocco mostly
1991/92 93,932 37,324 456 131,712
produces NFC juice).
1992/93 132,154 47,441 355 179,950
1993/94 116,248 52,912 225 169,385 China’s production is projected up
300,000 tonnes to 7.3 mln tonnes as a
1994/95 144,678 54,843 289 199,810
result of good weather and yields.
1995/96 132,907 64,543 224 197,674 Consumption is up on higher domestic
1996/97 153,842 65,676 842 220,360 supplies and robust import demand for
1997/98 160,865 74,767 989 236,621
high quality and counter-seasonal fruit.
1998/99 97,247 80,112 756 178,115
US production is expected
1999/2000 134,204 90,085 2,387 226,676
down 98,000 tonnes to
2000/01 124,072 89,564 2,246 215,882
2001/02 135,975 85,869 1,385 223,229
205,000 tonnes. Imports
2002/03 102,073 92,506 1,445 196,024
are forecast up 37% to
2003/04 139,727 93,393 500 233,620
410,000 tonnes
2004/05 54,322 88,514 1,059 143,895
Global orange juice production for 2017/18
2005/06 51,873 88,662 1,195 141,730 is forecast down 24% to 1.6 mln tonnes as
2006/07 47,996 74,523 907 123,426 Brazil and US production plunges on fewer
2007/08 80,817 84,710 0 165,527
oranges for processing. Consumption,
exports and stocks are expected to fall as
2008/09 72,543 82,561 1,115 156,219
Brazilian and US supplies, combined, fall to
2009/10 52,745 75,149 431 128,325 near 2015/16 levels.
2010/11 51,739 82,674 835 135,248
US production is expected down 98,000
2011/12 63,355 75,518 2,455 141,328
tonnes to 205,000 tonnes. Imports are
2012/13 47,968 79,247 411 127,626 forecast up 37% to 410,000 tonnes with
2013/14 22,723 76,035 442 99,200 Brazil and Mexico expected to supply over
90% of imports.
2014/15 19,224 71,891 865 91,980
2015/16 15,844 61,768 158 77,770 Brazil’s production is expected to drop
2016/17 12,648 53,237 162 66,047 nearly 30% to 1.0 million tonnes. Both
2017/18 7,664 34,378 146 42,188 exports and stocks are forecast down.
Source: USDA
EU production is projected down 8% to
24 / Global Outlook 2019 | IEG Vu www.ieg-vu.comAlthough overall fruit juice and nectars 6%. Zansler and the FDOC also predict that
consumption fell in 2017, the chilled and per capita consumption should be
NFC sectors are holding up well. Almost unchanged at 2.5 gallons.
all EU markets recorded increases, with
chilled juice seeing an overall gain of Once again, IEG Vu is taking a slightly
3.6%, taking its share to nearly a quarter more pessimistic view. The first report of
of EU fruit juice volumes. NFC juice the new season has actually posted
registered a similar growth level, and now steeper decline figures than the final
represents over one-third of EU fruit juice reports for the 2017/18 season reported.
consumption in 2017.
Although overall fruit juice
Nectars suffered a steeper drop than fruit
juices, affected not only by the backlash and nectars consumption
against sugar, but competition from fell in 2017, the chilled
flavoured water (which is perceived to be and NFC sectors are
healthier) and, in the chilled segment,
from chilled juice. Orange remains the holding up well
most popular flavour, but blended juices/
flavours are expected to increase as are, This may just be a one-off, and
particularly, fruit/vegetable blends. consumption may improve over the year,
107,000 tonnes. Consumption continues but we still think that the problems in the
to slide as imports are also down. What will US consumption be, then, in the orange juice market are too deep-rooted
season that ends in October 2019? Marisa for that. The slight recovery in Florida’s
Per capita consumption of fruit juice and Zansler, chief economist at the Florida production will not stimulate
nectars in the EU stood at 17.9 litres in Department of Citrus (FDOC), has predicted consumption: it will merely reduce the
2017, compared with 18.2 litres in 2016, total retail sales of 386 million gallons. The amount of juice that the US has to import
according to the newly published AIJN previous season’s sales were 411 mln from Brazil. We think US retail sales will
Liquid Fruit Report. gallons, so this forecast represents a fall of be 380 mln gallons.
THE ART
OF FRUITS
www.trisun.co.il
www.ieg-vu.com IEG Vu | Global Outlook 2019 / 25Apple juice 2018:
China sidelined and
Poland triumphant
The market has been upset by a complete reversal of fortunes.
By Neil Murray
China simply underpriced One major apple producing country suffers months of the start of the season) and
a devastating late spring frost which Moldova blended with Polish juice, so
Poland (and every other devastates its apple orchards (and badly overall Poland sold less than 100,000
competitor) right through damages other fruits), while another tonnes of its own production: a far cry
the 2017 season and then important origin enjoys a huge harvest. from the 2014/15 season when it exported
well over 313,000 tonnes.
in 2018, the two countries This scenario has been played out in two
changed places successive years. In early 2017, it was China simply underpriced Poland (and
Poland that suffered the frost, which cut every other competitor) right through the
its harvest to about 2.8 million tonnes, season. There was no way Poland could
while China had a record harvest of some compete: its average AJC price, fob, over
44 million tonnes. the season was around USD1,860 per
tonne. China averaged USD1,020/tonne
In April 2018, China had the frost and saw until March, after which it realised that it
12 million tonnes wiped off its production could charge pretty much what it liked.
and Poland had the biggest harvest in its
history: close to 5.0 million tonnes. IEG Vu had seen this coming and in
August 2017, predicted that China would
China exported about 708,000 tonnes of introduce a two-tier pricing structure. A
AJC in the 2017/18 season, while Poland lower price for the US and higher for
struggled to export anything at all. Total Europe. Even given the 30% duty
Polish exports were 172,850 tonnes, but disadvantage, China could still be
this included 76,000 tonnes of product competitive. “IEG Vu still believes that
imported from China, Ukraine (which had China has enough leeway in the European
filled all its EU import quotas within a few market to price its AJC at USD1,150/tonne
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