Orange Market - Citrus Greening Will Strike Orange Yield in 2016

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The global orange market is in crisis, with the average annual growth rates over the last X years at -X%. As a result, market volume decreased to X million tonnes in 2015. One of the main reasons is the "citrus greening" disease, widespread in the key centers of orange cultivation. To help agronomists, genetic scientists announced their readiness to provide modified forms of crop, but it will take a lot of time and resources to overcome this disease. Therefore, a reduction of the global orange market volume is expected once again in 2016, with continuous adjustments corresponding to the nature of the product consumption.

Brazil (X thousand tonnes in 2014), China (X thousand tonnes.), and the U.S. (X thousand tonnes) account for a significant amount of production on the global orange market, together supplying X% of total global volume. In turn, the largest plantations of orange trees are located in Florida (the U.S.) and Sao Paulo (Brazil). Unfortunately, citrus greening has already stricken these territories, which has affected production volume. From 2010 to 2014, average annual rates of orange production growth amounted to -X% both in Brazil and the U.S. China, in contrast, showed positive dynamics, with positive + X% growth over the same period.

Orange yield reduction affects consumption worldwide. In this case, a distinction should be made between fresh orange consumption and the processing of fruits into juice. Brazil is known to be the largest global supplier of concentrated orange juice, and the U.S. products are demanded mainly domestically. The industry impact of a decrease in orange harvest in these countries is analyzed below.

While approximately X% of all oranges produced in Brazil and the U.S. were processed in 2010, this value decreased by 2014, to X% in Brazil and to X% in the US. Yield reduction largely affected the volume of processing and volume of concentrated juice supply to the foreign markets.

Indeed, global exports of concentrated orange juice have slowed their pace. In 2014, the volume of concentrated juice exports amounted to approximately X thousand tonnes, which was X% less y/y. At the same time, Brazil remained the largest supplier of products, with a X% share (volume decline by X% y/y). The U.S. took a X% share (a X% decline in volume y/y). The fall in exports was caused by a combination of the reduction of orange yield in key concentrated juice producing countries with a weakening demand from importers. It should be noted that the decline in concentrated orange juice supply does not necessarily imply a reduction in the consumption volume of packaged juice containing oranges. Juice manufacturers can combine mixtures of other, more affordable fruits and berries, or manufacture products with a low content of orange concentrate.

China is still an imperceptible supplier of concentrated juice (with a X% share of global exports). The bulk of Chinese oranges is supplied to the domestic market in fresh form. However, the share of processing grew from X% in 2010 to X% in 2014. If this trend continues, China has a chance to increase its presence on the global and the domestic market of concentrated juices. At the same time, this country has the resources necessary to increase production volumes. Yields of oranges in China, standing at X Hg/Ha, are significantly inferior to the yields of the leading countries, with Brazil, the U.S., and the Mediterranean exceeding X Hg/Ha. Yield capacity will depend primarily on the weather conditions and the support of the industry at state level.

While global consumption of concentrated orange juice experienced a significant decline, the demand for fresh oranges decreased slightly. The following table shows the per capita rates among the top X countries in terms of consumption of fresh oranges. From 2010 to 2014, almost all countries observed negative average annual growth rates of per capita consumption value (around X%), except China. In 2014, the average per capita consumption rate of fresh oranges in China amounted to X kg/person per year, which was considerably less than in the leading countries. This means that there is an opportunity for growth of fresh produce consumption in China. Demand is increasing, fueled by the growth of urban population and the standard of living.

The top X countries in terms of consumption of fresh oranges include the countries which grow oranges themselves. The first place is taken by Brazil, with X kg of fresh oranges consumed per person per year. This is the lowest value recorded over the analyzed period; however, it still far exceeds the global average value, which is no greater than X kg/person.

Large countries without their own extensive plantations of orange trees, that have to import the product, are not on this list. Spain (X% in 2014), South Africa (X%), and Egypt (X%) are the suppliers of fresh oranges in this case. Netherlands (X%), Russia (X%), France (X%), Germany (X%), and other countries comprise the countries of destination. In 2014, X thousand tonnes of fresh oranges were exported overall, X% less y/y. However, a drop in the volume of supplies did not begin until 2014, before that, it was preceded by growth. Reduction of fresh orange trade volume in 2014 can be attributed to weaker demand caused by the crisis in the economies of countries of destination. In addition, Russia introduced a ban on imports of fruits from the EU countries in 2014, and a ban on supply of oranges from Turkey at the end of 2015, which also affected trade volumes. However, this decline in fresh orange trade in 2014 was caused by political and economic reasons, not the weather or tree diseases.

Orange industry in the U.S. and Brazil is in crisis, as yield perishes because of a spreading "citrus greening" disease, which affects the volume of processing, and has a direct impact on the global concentrated juice market. The share of products supplied for processing decreases as a result, same as the consumption of fresh products, both in Brazil and in the U.S. The reduction in consumption of fresh oranges also occurs among countries importing products from the Mediterranean region and South Africa. However, in this case, this is caused primarily by political and economic factors.

While the orange market around the world is experiencing difficulties, China displays positive dynamics. The country is increasing production of oranges and concentrate, and per capita consumption of fresh produce is growing. For now, China's orange industry supplies its products mainly to the domestic market, but it is possible that China may increase its presence in the global market, replacing American products.

Do you want to know more about the global orange market? Get the latest trends and insight from our report. It includes a wide range of statistics on

• orange market share
• orange prices
• orange industry
• orange sales
• orange market forecast
• orange price forecast
• key orange producers

Source: World: Oranges - Market Report. Analysis And Forecast To 2020