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China: Uptick in domestic orange production volume challenges import market

2018-07-18 foodmate

Tag: orange Chinese import

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The orange production season began in the second half of last year in one country after the other. The Chinese import volume of oranges continues to increase, but retail conditions are not great. This is mainly because supply and demand are not in balance. On the one hand, domestic orange production enjoyed a bumper harvest this year and the volume in warehouses greatly increased. On the other hand, while the import volume increased, the quality of imported oranges was mediocre.

Many more farmers around the world have set their sights on the Chinese market as living standards in China increase and more consumers demand high-quality fruit. As a result, the supply volume has sharply increased and export prices fell. The Egyptian and US orange production seasons of this year are in the closing stage. Overall, the consumers desire to buy was not strong, and the market was not nearly as active as a few years ago.

On top of this, China has increased the customs tariff for imported US oranges by 15% as part of the ongoing Sino-American trade war. This move had an obvious, but limited influence on the import of late-season US Navel oranges. Chinese consumers are very aware of brands, and the products that taste good have a large following. Despite the increased tariff and increased prices, Chinese consumers maintained a strong demand for various famous brands of US oranges. This shows that market conditions are still predominantly influenced by supply and demand relations.

The South African orange production season has begun and export to China is underway. It is still difficult to predict the market conditions at this point, but the conditions will certainly be better than they were for Egyptian, Spanish, and US oranges, as South African oranges arrive in the off season. As for domestic production, China is a large country when it comes to orange production. China has a large annual production volume that includes several orange brands whose products have already surpassed import oranges in quality; such as the Gannan and Wo oranges. However, as the harvest is abundant this year, the price will certainly decrease, which will hit the import market the hardest.

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