About 50 million tons of oranges are produced annually, with Brazil accounting for 34% of this total and being the leading exporter of orange juice, contributing to approximately 70% of the global supply. However, Brazil's orange production is anticipated to decrease by over 24% for the 2024–25 season due to severe drought, heat stress, and the spread of citrus greening disease, marking the smallest harvest since the late 1980s. This decline is part of a broader trend of reduced production in key regions, including Florida, Israel, Spain, and Argentina, which has led to record futures prices for frozen concentrated orange juice.
In Australia, where oranges are significantly produced, reliance on imports, particularly from Brazil, for frozen orange juice concentrate is high. This dependence could lead to supply shortages and price increases for orange juice and related products. The Australian citrus industry might face opportunities to fill domestic gaps and increase exports, yet challenges persist due to high production costs, labor shortages, and market dynamics dominated by major supermarket chains.
How can Australia's citrus growers become more resilient?
In the context of the ongoing supply shortage of orange juice, there are several measures that could enhance the resilience of Australia's citrus industry. One significant factor is the high cost of labor, which constitutes a major portion of total production expenses. Advancing towards automation could reduce dependency on manual labor, potentially lowering production costs. However, the adoption of such technologies might be challenging for small and medium-sized enterprises, necessitating governmental support through subsidies.
Additionally, diversifying sales channels could empower growers, reducing their dependence on large supermarkets. Strategies might include direct-to-consumer sales, increased participation in farmer markets, and engaging in collaborative marketing efforts. Prioritizing the establishment of more fruit-processing facilities and enhancing access to international markets are also recommended actions.
Furthermore, the threat of climate change to the agri-food sector, particularly orange production, is significant. It is advised to conduct extensive research into climate-resilient crop varieties, invest in renewable energy, and provide educational programs for growers to mitigate these risks.
Source: theconversation.com