Prices rise on European markets due to global orange juice shortage

"The current season for citrus by-products will allow us to increase our stocks. We have had a few lean years that have used up all the available reserves. The problem of below-average fruit size has led to a slowdown in the harvest and an increase in production costs, which has further reduced growers' margins. Against this backdrop, the market has found it difficult to absorb the rising cost of orange juice.

"The market is struggling to absorb the rising cost of orange juice, due to a number of factors, including an international scenario with a 60% reduction in the global supply of blond orange juice (from the US, Mexico and Brazil)," explains Salvatore Imbesi, manager of Ortogel, a Sicilian brand specialized in the processing of citrus, pomegranate and summer fruits.

"I have often pointed out that the selling price of by-products is disproportionate to the cost/revenue ratio between raw materials and production costs, which makes processing very expensive," says Salvatore Imbesi. At the moment, the situation is imploding because, on a global scale - due to lower orange production but an abundance of lemons - fruit juice market quotations are determined by the high price of blond orange juice and, on the other hand, the very low price of lemon juice. The difference compared to other years is that, whereas in the past the loss could be calculated, today the processing is done based on Brazilian juice prices, which are quoted at unacceptable rates. Why do I have the feeling that the situation is on the verge of implosion? If tomorrow Brazil - the world's leading exporter of oranges for the fruit juice sector, with a market share of 75 per cent - decided, as it has done in the past, to bring fruit juice prices back to those of 2020 - the year of surplus - all the citrus companies that have stocks would go bankrupt. What's happening in Sicily is that prices continue to fall, inexplicably, despite having gone through several years of low production."

"Unfortunately, today it is impossible to adapt to the dynamics of the market," concludes Salvato Imbesi. "These are market dynamics that are not reassuring either for farmers or for the processing industry. As far as we are concerned, prices are always fluctuating downwards. On the contrary, I believe that prices should not be determined by international speculation or by specific production peaks in certain years, but rather by the cost of producing the raw materials and the actual volumes, which vary from year to year. In recent years, I've noticed that the aim of companies buying semi-finished products for large retailers is to work at a loss, return to the processors, pay as little as possible for raw materials and bring agriculture to its knees."

History of the company
Ortogel processes only the best citrus fruits from the Sicilian supply chain. These include blood and blond oranges, lemons and mandarins, as well as typical Calabrian products such as bergamot and grapefruit. The products obtained are natural and concentrated juices, juices with and without pulp, hot and cold extracted essences, conventional and organic juices and essences, dried peels for pectin, dried peels for animal feed and bioethanol. The company also has facilities for the processing of summer crops (cactus figs, apricots, peaches and nectarines) and pomegranates to obtain their two main by-products: fresh arils for the fresh-cutting sector and 100% pure juice.