Market focus: September
Orange Juice Concentrate
Covid-19: Affecting the Orange juice Concentrate Market
The US is seeing Covd-19 cases increasing with some of the largest increases in the key prange producing states of Florida, Texas and California. Hotel , travel and airline businesses are still limited, but are slowly now coming back on stream. Looking ahead to the next season , industyry sources say that the workforcve could be affected due to the virus impacting the Hispanic community to a greater degree.
Countries Manufacturing Orange Juice Concentrates: Top 4 – Brazil, Mexico, US(Florida) and EU (top Turkey and Spain):
Florida – Season for Navel and Valencia Varieties: September to June 2019/2020 Season is over, and processors have ceased production. Early indications on production from the 2020/2021 havest in Florida point to a slightly smaller crop than the last season. It is possible that the very dry spell during spring adversely affected the fruit set. It is the decline in the piece count that is the reason that a smaller output is expected.
Mexico – Season for Navel and Valencia Varieties:
Early varieties: December, higher quality Valencias run from January to April New seasons crop starts in December 2020/2021 and looks better than last season’s disasterous crop. However, drought and heat were again a problem , which means that the volume output can tumble by more than ½ of last year’s ouput. Consumption and export will both drop due to low stock and increase in pricing.
Brazil – July to January with peak of the crop in August:
Brazil is the largest exporter and is estimated to account for over . of Global Orange Juice Exports. The production of Brazil FJOC 65B stock is predicted to slip more than 23% due to lower production. 2020/21 the crop has been running for a month, Hamlin variety was that of a short season and has already finished. The procesors are now running with the Pera variety, supplies are slow to arrive to the factories that have opened. This is attributed to the multibloom crop and a failed first flowering last year.
EU – October to April. Top 4 Spain, Italy, Greece and Portugal:
The EU productions are expected to be 21% lower – volume to be processed 84 000MT, as there is fewer oranges available for processing. The decline in production is expected to more than offset a slight increase in imports. Brazil is expect to remain the top orange juice supplier to the EU.
Table 1: Global Orange juice production vs Global Consumption
Table 2: Netherlands FCOL & NFC OJ Import
Countries Manufacturing Orange Juice Concentrates: Top 4 – Brazil, Mexico, US(Florida) and EU (top Turkey and Spain)
The main market drivers for the future pricing in the new term are that of:
• The official figure on Florida’s next crop in the close near future
• Impact from Covid-19
• US Sales date
• EU official crop figures (driven by Turkey and Spain)
With smaller crops in Florida, Brazil, Mexico and EU the FCOJ 65B will moved upwards eventually. Traders are expecting pricning to be higher for the coming seasons vs the last crop seasons.
• Pricing from large Brazilian producers are at $2000/MT for 65-66Brix (Same as last month), Some bueyrs have fixed deals until the end of the year and some have covered their needs until the next season in Brazil (2021/2022)
• However, supplies are more than sufficient to feed demand for the foreseeable future and Brazilian stocks are predicted to grow in spite of the smaller crop this season.
• The $US dllar has significantly strengthened agains the Brazilian Real (BRL) since last season, which further allows for the discounts from the Brazilian operators, rendering them willing to offer lower prices for large long-term contract ($1700-2000/MT)
• Mexico pricing – offers on FJOC between $1650-1700/mt FOB ( to EU and Asia)
• Florida – $2000-2100/MT FCA
• EU – Top 4 leading prices: Euro 1800-1850/MT FOB
Covid-19: Affecting the Apple juice Concentrate
Total European apple 2020 is forecast to fall marginally to 70.71 million tons from 70.78 million tons in 2019 . The slightly larger availability of processing apples should not have a negative effect on prices this year as stock of concentrated apple juice (CAJ) juice are depleted. In adadition, China expects a 10-percent lower apple crop due to alternate bearing. As a result, Chinese CAJ production should be significantly lower, which in turn would lead to less competition on the world market. EU exports to Latin America are expected to decrease in MAY 20/21 because COVID related logistical problems (border restrictions, lack of containers and labor at ports.)
China – Season: End July to December (Market outlook unchanged)
Growing regions in China have experienced freeze events and hail damage. The Chines Chamber of Commerce is expecting a 15% cut in harvest yield; thus manufacturers are not expecting large crops and availability for fruit for their productions. China is one of the major suppliers to the USA, due to the Corona Virus these shipments will be offset by New Zealand, Poland and Chile.
Pricing: From top leading Countries
• Poland: medium acid apple concentrate 70 Brix – Ex factory Eur 1150 – 1200/MT
• Poland: high acid apple concentrate 70Brix (low availability) – Ex Factory Eur 1300/MT
• Turkey: medium acid apple concentrate 70 Brix – Ex factory Eur 1180 – 1250/MT
• Domestic pricing: Ex Factory $950/MT
• 1.22-2.0% low acid apple conc 70% – FOB $1150-1250/MT
• 2.0-3.0% medium/low acid apple concentrate – FOB $1270-1350/MT
Global Red and White Grape Juice Concentrate Market: Region wise Outlook
Global red and white grape juice concentrate market are divided into seven regions, namely Eastern Europe, North America, Western Europe, Latin America, Asia Pacific excluding Japan (APEJ), Japan, the Middle East and Africa (MEA).Western Europe holds Western Europe, Latin America, Asia Pacific excluding Japan (APEJ), Japan, the Middle East and Africa (MEA).Western Europe holds the significant share in the global red and white grape juaice concentrate market owing to the large production and consumption of grapes and grape wine in Italy. The grape production in the world ismainly with the purpose of wine production . North America holds the significant market share in the global red & white grape market . The major two regions for production and export for fruit juice applications are Europe (Italy and Spain) and SouthAmerica (Argentina and Chile).
Grape juice concentrate has traditionally been used as a natural sweetener ingredient in many foods products. More recently, grape juice concentrate has found its way into the wine industry, primarily as a blender and sweetener for varietal and super-value wines. Concentrate is also used to produce a small category of high-intensity red and purple colorants known as “mega colors,” or red and purple 8000 color. These products are used to enhance color and add body to wines. Accordingly there is a minor, but not unimportant, linkage between wine markets and the market for grape juice concentrate produced from raisin and table grapes
Countries Manufacturing Grape Juice Concentrates: Top 3 – Argentina, Italy and Spain
Argentina – Season: February to April
Trading on the grape juice market is reportedly quite. Most of the contracts were fixed during the crop which wound up in April. The Juice export between January and June is higher than last year’s season. This can be attributed to a healthy crop as well as increased sales to Saudi Arabia, where blenders are using grape juice in the beverages in order to meet the new sugar tax regulation.
Italy – Season: Harvest from September to October
The abundant crop for 2019/2020 – most of the grape juice is used for Wine making. Italy produced 8.4 mio MT for current season which is nearing it end in October. It’s 2020 harvest is showing good harvest yields – in general– a step up in quality, particularly in the late-season reds. The bulk wine market in Italy has been active, especially with interest in the higher-quality reds, international varietals and wines for blending. Prices were firm-to-rising in the final quarter of 2020, due to the good levels of activity
Spain – Season: Harvest from September to October
The OIV estimated Spain’s 2020 harvest at 34.3 million MT, modest 10% up from the five-year average. As a result, the season will end with Spain’s bulk market proceeding steadily, with supplies of concentrated red and white grape concentrates with moderate pricing.
Pricing: From top leading Countries
• Grape White Conc 68B – FOB Buenos Aires $1200-1300/MT
• Red Grape Conc (std) – ex factory $1300-1450/MT
Europe (Spain and Italy)
• Grape white Conc 68B – ex factory $1100-1200/MT
• Red Grape Conc (std) – ex factory $1480-1520/MT
Key Points: Banana Puree
The Banana Puree industry has more than one hundreds manufacturers in the world, and high-end products mainly from U.S. and Western European.
The global banana puree market is expected to grow moderately over the forecast period. This can be attributed to increasing consumption of banana puree by consumers owing to its various health benefits. Additionally, increasing consumption of banana puree by athletes and sports persons is a major factor expected to drive growth of the global banana puree market. Moreover, rising demand of banana puree from the baking industry is another major factor fueling growth to the market. North America is a dominant player in the global banana puree market and accounts for highest revenue share as compared to that of markets in other regions, followed by Europe. This can be attributed to factors such as high disposable income, health concerns, and increasing use of cosmetics. The market in Asia Pacific is projected to have fastest growth in terms of revenue, owing to factors such as rising health awareness, and changing lifestyle.
Future growth lies in the Asian-Pacific region with low growth in North America and Europe as the markets have matured.
• Banana puree 21-23 Brix
• FOB $700/MT
• Banana puree 21-23 Brix
• FOB $950/MT
• Banana puree 21-22 Brix
• FOB $500 – 550/MT
• Banana puree 21-22 Brix
• FOB $550-560/MT
Key Points: Mango – Totapuri, Alphonso and Kesar ( India) – Seasons: South West March to April. North East June to July
The Covid-19 situation in India is very serious, the number of cases of infections is rising every day with the increase in testing capacity. Nevertheless, recoveries are also climbing and are now above 70%. Exports shipments are affected by the pandemic mainly in Western India and, to a lesser extent, Southern India.
Mango – AMP (India)
The Industry in India only produced 15 000MT of AMP against 50 000Mt last season. Stocks are completely sold out but there are some small processors holding on to 1 or 2 full container loads that are looking to sell at a premium. The Uptake of stock has been good from EU and North America, but “lukewarm” from India and the Middle East.
Mango – Kesar (India)
The Demand on Kesar is slack at the moment but is expected to increase as the shortage of AMP is realized. AMO shortage is substituted by Kesar Mango as the taste profile of the varieties are close
Mango – TMP/TMC (India)
The TMP season has finished the end of July, production is down 60% on last year’s volume. From Europe the demand has been good but the uptake from North America and the Middle East has been slower. Free stocks in India are limited and is expected to depleted by December. However, the supply of MP is predicted to last until February 2021, therefore the market is expected to face supply problems for TMP in the first half of 2021.
Key Points: America and Mexico
The situation regarding Covid-19 in Columbia has not changed and in some areas the situation has deteriorated further with quarantine and lockdowns in many of the fruit-producing zones. Local processors are still operating in order to continue to guarantee work in both the factories and the plantations. The 2020 main summer crop is nearing the end and while the crop itself was very good. 30-45% of the fruit has been lost in the fields due to the logistics and lockdowns relating to Covid -19. The Demand is at record high levels and keeps rising, particular from the EU and the US. Processors are continually receiving enquiries for all types of mango products and is now developing ‘sustainable’ and ‘socially certified’ products.
Mexico is in the middle of its mango crop and will come to end in September. Traders from EU indicates that Mango Concentrate from Mexico is ‘price attractive’ but the supplies from Columbia is of higher quality.
Pricing: From top leading Countries
• AMP now pegged at CFR Europe $1450-1600/MT vs pricing in May at CFR Europe $1100-1225/MT
• Kesar pricing at CFR Europe $1350/MT vs CFR Europe $1175-1200/MT last month
• TMP pricing at CFR Europe $850-900/MT vs CFR Europe $825-850/MT last month
• TMC pricing at CFR Europe $1350-1400/MT vs CFR Europe $1250-1275/MT at the start of June
• 28Brix Conc FOB $1150/MT vs FOB $1100-12350/MT last month
• AMP (15-17Brix) now pegged at CFR Europe $1,450-1,650/MT vs pricing in May at CFR Europe $1,400-1,600/MT
• Kesar pricing at CFR Europe $1,300-1,350/MT vs CFR Europe $1,350/MT last month
• TMP pricing at CFR Europe $875-900MT vs CFR Europe $850-900/MT last month
• TMC (28 brix) pricing at CFR Europe $1,375-1,425/MT vs CFR Europe $1,350-1,400/MT against last month
• Magdalena River 28 Brix FOB $1,150 -1,500/MT vs FOB $1,150/MT last month
• Sing strength (puree) FOB 1,100/MT
• Tommy Atkins Mango Conc (28Brix) CFR Europe $950 – $1,050/MT
Countries Manufacturing Passionfruit Concentrates: Top 3 – Ecuador, Peru and Vietnam
Ecuador: Season – Peaks in April and August with a lower, sustained production throughout the year.
The Production of the fruit began slowly, but the second half of the month saw the start of the peak production period, slightly earlier than usual. Juice yields are still low – possibly the worst on record. The main growing areas have experienced cold and cloudy weather which has hampered fruit ripening. Nevertheless, the improved praoduction has helped fruit prices to decrease from last month. This has increased the demand slightly and processors hope that the uptake will continue to improve with the new pricing. However, with higher output in most other producing countries, supply is outstripping demand and therefore stock levels are expecting to rise. Replanting is limited due to the lower fruit prices which has reduced the incentive for farmers.
Peru: Season – Peaks in July to September
Peru had a peak production in July and has continued another 2 weeks into August. Production has started to wind down from mid August until the end of Season in September. Due to Covid-19, restaurants and hotels are closed, which has affected internal fresh consumption. As a result, processors have absorbed a much larger share of the total crop. Traders in EU indicated that the producers in Peru are keen to make sales now. The next peak production will be in November.
Vietnam: Season – October to March
Vietnam has seen a sudden increase of people infected with Covid-19, this occurred when the Country was about to relax restrictions on business visits from neighboring countries. The country has been the cheapest source of Passionfruit concentrate for some time now and has managed to increase its share of the global market as a result. As of 1st August, Vietnam has a freetrade agreement with the EU and producers are looking to fix contracts going forward.
Pricing: Ecuador, Peru and Vietnam
• Passionfruit Concentrate 50Brix – FCA Europe $5,900/MT vs FCA Europe $6500/MT
• SS Passionfruit – FCA Europe $1700/MT vs FCA Europe $2150/MT
• Passionfruit Concentrate 50Brix – FCA Europe $5,450-5,900/MT
• SS Passionfruit – FCA Europe $1,850/MT
• Passionfruit Concentrate 50Brix – CFR $4,400-4,900/MT
• SS Passionfruit – CFR $1,500-2,300/MT
Pineapple Juice Concentrate / Frozen Pineapple Juice
Key Points: Pineapple Juice Conc/Frozen Pineapple Juice: Thailand, Central America and Philippines
The countries with the highest volumes of pineapple production in 2020 were Costa Rica, the Philippines and Honduras, with a combined 70% share of global production. Thailand, Indonesia, Nigeria, India, China, Mexico, Colombia, Ghana and Angola lagged somewhat behind. The most notable rate of growth in terms of pineapple production, amongst the main producing countries, was attained by Ghana, while pineapple production for the other global leaders experienced more modest paces of growth.
Thailand Pineapple Conc/Juice – Season February to May
Thailand is in between its Summer and winter crops. Production from Summer crop was extremely poor and the high price for the fruit has meant that processors there are finding it near impossible to compete in the open market There are a few smaller packers still running fruit and are taking on any volumes they can get hold of. Farmers rely that the growing conditions for the fruit is fair but the Winter crop only provides1/3 of the country’s annual output. The Industry is only expected to produce 0.9 million MT this year. In usual year output the processors deliver between 2.0-2.2 million MT. Exacerbating the situation is the lack the usual workforce. Pineapple is a crop that is very labour intensive and the migrant workers from Cambodia and Burma are not available to Covid-19. This has led that replanting has been slow for the past 6 months, which means there is unlikely to be change in the poor supply form Thailand until the second half of 2021.
Central America Pineapple Conc/Juice – Season all year around
Over 90 percent of Pineapple volume is produced in where Costa Rica (73 percent) is the main producer of Pineapple followed by Honduras (10 percent) and Mexico (9 percent). Supply of Pineapple fruit is low due to the early Covid -19 pandemic, supplies dropped to less than half of normal levels, which was also attributed to shipping problems in addition to supply chain issues, including lower market demand. However, even if there was a rise in January and February in price this year, the overall market price from Central America remains consistent. Costa Rica has increased their business in China, even if China produce their own pineapple their quality remains a problem. Therefore China prefer to import the Fruit, Juice and concentrate as consumers are looking for better quality for a healthier lifestyle.
Philippines Pineapple Conc/Juice – Season May to July
The Philippines, particularly have embarked on a campaign to secure greater percentage of the global market and there is speculation that the producers will soon take the crown from Thailand as the key global pineapple producer. Difference between the 2 regions is the price of the fruit. The fragmented nature of Thailand’s Industry, with thousands of small farmers and fruit dealers, means fruit pricing is extremely volatile from year to year. In contrast, most of the processors in the Philippines own their own plantations and therefore can keep their pricing stable.
While August is usually a quit time for trading, demand has been slow for several months now and most buyers are covered at least until the end of the year. There are also sufficient stocks in Rotterdam to meet market demand for the foreseeable future. These factors could put downward pressure on pricing. Traders say that consumption of Pineapple juice concentrate is declining in Europe, but uptake of NFC is stable.
Pricing: Thailand, Central America and Pilippines
• Pineapple Concentrate – Remains between FOB $2100-2500/MT, even at the higher end if this range producers are not covering costs. Chances of prices easing during the Winter crop are slim.
• Pineapple Concentrate – FOB $2000 – 2200/MT
• Pineapple Concentrate – FOB $2000-2200/MT