A recovery in citrus volumes from nearly all origins is expected this season on import citrus. "After last year's climatic challenges, such as the El Niño phenomenon in Peru, we are prepared for a significant increase in our supply," says Alejandro Moralejo, CEO of Salix Fruits.
The import season began in March-April with early mandarins and will continue until October. Lemons also became available in March and will continue until September, while oranges, starting with Navels and continuing with Valencia types, started in May and will continue until October. Grapefruit imports also began in May and will go until August while Tahiti limes will be available year-round from Colombia and Peru.
In the lime category, the drought in Mexico–the largest producer of limes in the Northern Hemisphere–has resulted in a reduced volume and smaller size of the fruit. "So it is very likely that there will be a smaller quantity of fruit, but what will be most affected is its size. This could be an opportunity for larger-sized Colombian and Peruvian limes," says Moralejo.
Overall, the citrus picture is different from last year in the Southern Hemisphere which had a unique season shipping to the U.S. with California and Mexico having less fruit. "Chile also had lower volumes of oranges and lemons and Peru and Chile had fewer mandarins. Argentina increased its lemon volume but could not fully supply such a demanding market," says Moralejo.
Along with sourcing citrus from Peru and Chile, it also receives fruit from Uruguay and this season it's also starting with South African citrus. In this full range of citrus, it ships fruit based on the quality preferred by each customer.
One sourcing origin that is growing in supply is citrus from Argentina–particularly lemons. "The market reopened in 2018 for Argentine lemons, and we were in a prime position given that Salix and its founders are from Argentina," says Moralejo. "This allowed us to quickly penetrate the market due to our connections."
Growing Southern Hemisphere volume
Since then, it's been growing its overall volume of citrus from the Southern Hemisphere. Last year, it marketed more than 750,000 boxes of citrus with Argentinian lemons representing almost 50 percent of the volume the company imports. "However we have also seen growth in Chilean and Uruguayan oranges and Peruvian mandarins," adds Moralejo.
As for demand, with it shipping to several major supermarket chains, foodservice companies, and wholesalers, Moralejo says the key to maintaining strong partnerships is always having fruit available to offer. "Our close relationships with our suppliers allow us to have fruit even during the most challenging times of the year," says Moralejo, adding that to increase retail sales, fruit on the shelves at optimal ripeness helps consumption and customer satisfaction.
At the same time, the citrus market is determined by the supply of the product and not by the demand. "Demand is generally very "inelastic," especially for limes and lemons, perhaps slightly less so for sweet citrus. Therefore, it will be necessary to see how the supply reacts and, based on that, how the demand behaves, because the supply will determine the price and from there will drive the demand accordingly," says Moralejo.
Meanwhile pricing on the spot market was attractive. "It was a year where producers obtained good prices for their products," says Moralejo. "It is still too early to predict how the Southern Hemisphere will perform, but all suppliers hope to achieve at least last year's prices." This season, the key differences impacting pricing are largely ocean freight rates which have returned to pre-pandemic levels.
Looking ahead, Salix Fruits is working with its supplier Ledesma to open the U.S. market for Argentine Valencia oranges in the near future.
For more information:
Salix Fruits
[email protected]
www.salixfruits.com