In 2022, the volume of the global trade in fruits and nuts, which has been growing steadily every year for many years, has fallen for the first time, according to the EastFruit analytics group. We looked at the reasons for this extraordinary event and its potential impact on the countries of Eastern Europe and Central Asia.
If we analyze the trade of the 25 largest fruit exporting countries globally, which account for about 80% of all global exports, the volume of exports from these countries decreased by $4.05 billion in 2022, or 3.5% compared to 2021. Prior to this, global trade was growing dynamically, and its average annual growth in 2018-2021 was 6.3% or $6.6 billion per year.
It is interesting to note that out of the Top-25 countries, only 6 countries showed an increase in exports or less than a quarter of the countries. And this speaks of grave problems in this industry or in consumption.
If we look at who exactly increased exports and who reduced them, the answer to the question about the causes of the fruit trade crisis becomes more obvious. Exports of fruits and nuts were increased by Chile, Peru, Costa Rica, Egypt, Morocco, and Guatemala – countries that took advantage of the possibility of off-season deliveries, combined with such an important element of the horticultural business as cheap labor. But all the EU countries, without exception, as well as the USA, that is, countries with the highest income levels and high labor costs, have significantly reduced their exports of fruits and nuts.
Why did the global trade in fruits and nuts plummet in 2022?
“Fruits and nuts, for the most part, are not essential foods. In 2022, the world experienced an economic and energy shock provoked by Russia’s military aggression against Ukraine. This led to a sharp increase in energy costs for producers, a sharp increase in the cost of logistics, and an increase in costs for basic foodstuffs, with little or no growth in consumer incomes in Europe and the United States. Consequently, the demand for fruits and nuts has noticeably weakened. Another reason was the problems caused by climate change and various weather anomalies, which lead to growing losses in fruit crops,” says Andriy Yarmak, economist at the Investment Center of the Food and Agriculture Organization of the United Nations (FAO).
He adds that the factor of “deglobalization” or the decrease in the openness of various countries to import and export products also played an important role.
Besides, it should be taken into account that the drop in trade is estimated in terms of value in US dollars, and dollar inflation in 2022 exceeded a record 8% for recent years, which indicates a very sharp real decline in global exports of fruits and nuts.
For more information: east-fruit.com