Market participants in Europe are bracing for a challenging year in the apple and orange juice sectors. Brazil's Fundecitrus anticipates a 30% year-on-year decrease in orange production in São Paulo and West-Southwest Minas Gerais, from last season's 307.22 million boxes. Concurrently, the World Apple and Pear Association (WAPA) projects an 11% drop in European apple production to 10.2 million tonnes, with Poland, the leading apple juice producer, experiencing a 20% decline.
At the SIAL conference, the focus was on the sourcing difficulties for the upcoming year. Some European orange juice companies have ceased operations due to sourcing challenges. Brazilian processors are now prioritizing smaller shipments to key customers over large tanker shipments to markets like Australia and Japan. The Expana benchmark for Brazilian orange juice delivered to Europe stands at $7000/MT, marking a 55% increase year-on-year, impacting retail consumption.
Potential mitigation strategies discussed include increasing production in other regions or substituting orange juice with mandarin juice. However, the consensus is that Brazil's orange juice production capacity remains unparalleled. The industry's recovery remains uncertain in the near term. The apple juice market faces its own set of challenges, particularly with Poland's frost-affected crop. The current market dynamics include stock withholding by processors and prolonged negotiations, with concerns over availability. Nonetheless, there is hope that the situation may improve with the 2025 apple crop. Meanwhile, Chinese low-acidity apple juice is being delivered to the EU at EUR 2100/MT, compared to the EUR 2200/MT price for European-produced juice, as reported by Expana.
Source: Mintec