Egypt increases volume of oranges in Europe.
As was announced late in 2018, Egypt might be in advance of Spain in the list of the biggest orange exporters on European market this season. This forecast had been made not once during the recent years.
Egypt competes Spain in Europe
Egypt started on the second week with Salutanas & Valencias, Balady oranges were shipped few weeks before. Spanish season meets challenges particularly due to the large sizes shortage. Low prices in Europe led to the big volume still had not been harvested. The crop is 23% more than last year with small sizes prevailing. Sharpening of competition with Egypt & Turkey caused the drop of price for Spanish fruits.
At the moment the demand for late varieties decreased as the European market is overfilled. Sales have ground to a halt. Traders are focused on such varieties as Powel, Barsfield & Midnight harvested in May, when the season for Egyptian & Turkish citrus will run out. Prices for these varieties are nearly 16 cents per kilo in Andalusia & run from 18 to 24 cents in Valencia, depending on quality & sizes. Only the biggest brands succeed to sell their oranges with profit. In spite of the higher quality of Spanish fruits most of the retailers make Egyptian & Turkish citrus first choice.
Whether Egypt wins due to the situation in Spain or not – that’s the question. Tom Leenheer, the expert of «Van Ooijen Citrus» isn’t quite sure. «I don’t think Egypt can fill the large volumes normally filled by Spain, although I do think they’ll manage it for the small sizes».
According to a report of Radio France International, an export of 1.65 million tones has been estimated for this year. This figure means fundamental rise in exports. In 2017, the last complete year with export figures available, Egypt declared an export of more than 662,000 tons. In 2013 and 2014 the volume of one million tons was reached, but export dropped in the following years.
Russia, Saudi Arabia & China are the main markets for Egyptian citrus, but the Egypt export to Europe increases for some years in a row. The EU imported oranges in total 99 million euro in 2013. During the next four years this volume increased up to 147,5 million euro. The Netherlands is the main transit destination for Egyptian fruit. The volume of citrus from Egypt shipped in Europe through the Dutch ports doubled in 2014. Nearly 56 000 tons of Egyptian oranges were imported to the ports of the Netherlands that year. In 2017 this volume reached 115 000 tons.
The production should be increased to provide the export growth like this. In 2017 the planted acreage of oranges in the country amounted 119581 hectares. The planting area increased by 18% compared to 2010. The yield for this area in 2017 resulted more than 3 million tons of oranges, which is twice amount as harvested twenty years before (nearly 1,5 million tons) & aligned with the acreage increase of 18% in twenty years. Spain harvested 3,3 million tons of oranges In the same year.
For export to grow like this, production also has to be increasing. In 2017, the country had 119,581 hectares of orange production. Compared to 2010, that area had increased by 18 per cent. In 2017, that area resulted in a harvest of more than 3 million tons of oranges. That was twice the amount of oranges harvest 20 years before that: 1.5 million tons. For comparison: Spain harvested more than 3.3 million tons of oranges in that same year. This corresponds to an increase of 18 per cent in 20 years.
Egypt recipe for success is the exchange devaluation and labour costs
The Egyptian sector profits differ from other segments of global market. Russian boycott of European fruits gave the opportunity to Egyptian producers. In addition the low labour costs combined with the devaluation of the Egyptian pound make it possible to sell the Egyptian fruits at a very attractive price. The exchange rate of the Egyptian pound on 31 December 2018 was at 20,36 Egyptian pounds per euro. Two years before in the same period it was 8,5 Egyptian pounds per 1 euro.
The big importers, such as Van Ooijen Citrus», note the growing importance of Egypt on the European market. According to the leading expert of the company, the country becomes more important from year to year because Egyptian companies update their products & packaging. «The importer gets clear preference choosing the Egyptian products. We’re never that fond of Navels from Egypt, we often think these are too dry and don’t have the right flavour, that’s our primary focus. On the other hand, Egypt is a good partner for juice oranges. “Juice oranges from Egypt are fine, both regarding color and flavour». – the expert noted.
Source: www.freshplaza, 03/12/2019; 03/15/2019