Pressure Builds on Export Markets

Article by: Hari Yellina

With the citrus business prepared for a large surge in fruit production, a lemon Armageddon or mandarin mountain could be on the way. Several presenters at the Citrus Technical Forum 2022 on the Sunshine Coast on March 8-9 hinted at large harvest quantities in the next years, emphasising the importance of a solid export strategy. Citrus Australia CEO Nathan Hancock said the Australian business had historically been export-focused, and that the volume of fruit produced will continue to expand as a result of new plantings. Maintaining present export markets and pushing to develop markets, he added, was crucial, as was fruit quality and adherence to standards.

“Australian citrus is known for its high quality, which requires work and solid management procedures,” he explained. “We trade on our high quality, and we must deliver on it in order to maintain positive results in our export markets, which will continue to be impacted by shipping route disruptions.” Another speaker, EE Muir & Sons consultancy lead Matt Strmiska, who talked on international horticulture deals, echoed this sentiment. Mr Strmiska stated, “The quality of fruit that touches the market has to be extraordinary.” The 2021 Citrus Australia Tree Census was launched at the forum, but due to the potentially sensitive nature of the information contained within, it was kept in-house.

Citrus Australia created the census as an online database to collect national production statistics such as variety, rootstock, tree age, and planted hectares. The 2019 census counted 1262 orchards with a total area of 26,907 hectares. Previous census results have generally shown a continuous growth in acreage and fruit production. According to the Australian Horticulture Statistics Handbook for 2020/21, Australia produced 708,827 tonnes of citrus worth $936.3 million in the year ending June 2021. Fresh supplies had a wholesale value of $668 million, with $571 million going to retail and $114 million going to food service. During that time, a total of 238,576t was exported, worth $442 million.

Mr Hancock’s estimate for 2022 was favourable, with a strong crop of fruit in most growing regions, albeit no particular figures were provided. “We’ve got wonderful growing conditions across the country,” he said, “with the normal issues of wind rub in the spring,” but “in all likelihood a very successful production season.” “At this point, as we’ve heard, there will be challenges, and there may be markets we can’t supply due to shipping issues, but we’ll have to keep a close eye on things because we simply don’t know what the effects of Covid and the ongoing war in Ukraine will have on sea freight reliability this season.”

The Ukrainian conflict, on the other hand, may have an influence on the worldwide citrus trade. While fresh fruit was immune from trade prohibitions, he added that because Russia’s economy was under severe strain and traders were unable to use SWIFT, South Africa may have to rethink what it will do with the fruit. Mr Hancock added, “Our hearts go out to all who are touched by this dispute, and we hope it is resolved quickly.” “From a market standpoint, South Africa, the southern hemisphere’s top citrus exporter, supplies over 150,000 tonnes of citrus to Russia, which may be displaced as a result of the crisis; they have over 90 markets to export to, but we expect there to be an impact.”