Citrus Annual Report- 2011

An Expert's View about Citrus Fruits in Turkey

Posted on: 23 Jan 2012

Production of all citrus varieties increased in MY 2010 and will continue to increase in MY 2011 as well.

THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY Required Report - public distribution Date: 12/30/2011 Turkey Citrus Annual Citrus Annual Report- 2011 Approved By: Rachel Nelson, Agricultural Attaché Prepared By: Yasemin Erkut, Agricultural Specialist Report Highlights: Production of all citrus varieties increased in MY 2010 and will continue to increase in MY 2011 as well. Russia, Ukraine and Iraq are still the major export destinations for Turkish citrus. The Turkish government will provide USD 125/MT in export subsidies to citrus exporters for the MY2011 crop. Executive Summary: Citrus is among the top exports in the Turkish agricultural sector. In the past few years production of most citrus varieties has been increasing slowly but steadily. MY 2010 was a good year both in terms of production and exports and MY 2011 is predicted to be a good year as well. Orange and tangerine production is estimated to increase slightly, whereas grapefruit and lemon production is expected to increase noticeably. This was mainly due to very good weather conditions during blooming and growing seasons. This increase, however, will be countered by lower quality and smaller sized fruit. Russia, Ukraine and Iraq continued to be the top export destinations for Turkish citrus in MY 2010. Iran also became one of the major export destinations in both MY 2010 and MY 2011. The Turkish Ministry of Food, Agriculture and Livestock will provide export subsidies of USD 125/MT to through the Mediterranean Exporters Union in MY 2011. Commodities: Orange Juice Oranges, Fresh Grapefruit, Fresh Tangerines/Mandarins, Fresh Lemons, Fresh Production: Oranges traditionally account for almost half of the citrus production in Turkey. Tangerines and lemons follow oranges at about 23 percent each. Grapefruit is usually only about 5 percent of overall production. The Mediterranean Region accounts for about 90 percent of all citrus grown in Turkey, and the Aegean Region counts for most of the rest. The production of all citrus fruits both in MY 2010 and in MY 2011 has been good compared to the previous years. MY 2011 production is predicted to be especially high for grapefruits and lemons. This is mostly due to favorable weather conditions during the blooming and growing seasons. The winter of 2011 was rather mild and spring was warm and long in most citrus growing regions, especially in the Cukurova region. This led to higher yields for some citrus fruits. Grapefruit production is predicted to increase about 12 percent from 213,000 MT in MY 2010 to 240,000 MT in MY 2011. This is due to the previously mentioned favorable weather conditions. High productivity, however, led to slightly lower quality and smaller grapefruits in MY 2011. MY 2010 was also a good year for lemon producers and lemon production is also expected to increase again slightly in MY 2011. In MY 2010 lemon production was recorded as 787,000 MT and is predicted to increase about 8 percent and reach 850,000 MT in MY 2011. This is also due to favorable weather conditions. Higher yields however led to smaller lemons. Tangerine production is also predicted to continue increasing slightly in MY 2011. Production was 858,000 MT in MY2010 and in MY 2011 it is expected to reach 874,000 MT. Orange production was 1,710,000 MT in MY 2010. Production is expected to increase slightly to 1,730,000 MT in MY 2011. The production of all citrus in Turkey has been increasing steadily in the past 20 years, but especially since the year 2000. This is mainly due to increasing number of citrus orchards, better varieties and increasing awareness of the producers. The main varieties of oranges grown in Turkey are Washington Navel, about 75 percent of the crop, and Valencia, about 20 percent. Enterdonate, which is the primary export variety, comprises about 40 percent of total lemon production. Star Ruby is the main grapefruit variety, at about 50 percent of the total, and Satsuma is the main tangerine variety, at about 60 percent of the total. The primary production zone is Cukurova which produces 70 percent of all citrus grown in Turkey. The three provinces that make up Cukurova specialize as follows: 1. Hatay Province- southern part and specializes in oranges, 2. Adana Province - central part and specializes in orange, tangerines and grapefruit, 3. Mersin Province - western part and specializes in lemons. Antalya province, located to the west of Cukurova, produces about 20 percent of all citrus in Turkey. The major crop is oranges and about 30 percent of all oranges produced in Turkey are from this region. Izmir is the leading province in the Aegean Region and about 5 percent of all citrus grown in Turkey is from this province. Tangerines are the major crop of the region and 15 percent of all tangerines produced in Turkey are from the Izmir area. There are no official statistics about the quantity of citrus used for processed products, such as juice, but industry contacts estimate that about seven percent of total orange production is used to make orange juice concentrate. Fresh squeezed juice is popular especially during the summer, which is the heaviest season for tourism. Traditionally the processing of lemons, tangerines and grapefruits has been minimal. However, especially since MY 2008, there has been an increasing interest in lemonade consumption. This led to a higher volume of lemons being used in processing facilities. Consumption: Domestic consumption of citrus fruits is high in Turkey. Consumption of citrus, as well as other fruit, has increased steadily in recent years as per capita income has increased. Currently per capita consumption of citrus in Turkey is about 30 kilograms (66 lb) annually, nearly all as fresh fruit. Citrus consumed as juice is still quite low compared to some other citrus growing countries, as there are many competing non-citrus juices. Approximately 60 percent of all citrus fruit is consumed domestically; seven percent is used for industrial purposes and the rest is exported. There is a significant potential for increased citrus consumption from the tourism sector in the southern parts of Turkey. The number of tourists coming to Turkey every year is increasing, and this sector utilizes mainly processed but also fresh citrus fruits. Prices The domestic market is very price sensitive, and fluctuations in the price of citrus fruit affects consumption. According to industry sources, prices in most of the top export destinations for Turkish citrus are lower in MY 2011 due to higher yields and increased competition. Nearly half of Turkey’s citrus crop is selected, graded, and packed for upscale domestic and export markets. About a dozen large-scale packing companies, with annual capacity of at least 15,000 MT, dominate the market. The packing business is very risky since packers pay firm prices to growers against uncertain export receipts. There has been a great deal of turnover in the business during the last twenty years. Several packers have maintained their position by relying on production primarily from their own orchards. The remaining half of Turkish citrus production does not undergo any selection or grading and is sold through wholesalers and retailers with only minimal or no packing. Private packers handle marketing of all citrus crops. Packers used to begin contracting in August and purchase the crop “on- the tree.” Due to uncertainties in the market, packers have started contracting later and buying as much as they think they will sell. They estimate that this year about one half of the crop will be first or second grade destined for the upscale local market and/or export market. The remainder will be sold to regional wholesalers or supermarket chains. Combined losses from harvesting and processing are estimated at about five percent and added to domestic consumption. Farm gate prices vary considerably by quality and location. Trade: Citrus has traditionally been Turkey’s leading fresh fruit export. Neighboring countries continued to be significant markets for Turkish citrus fruit. In MY 2010 Russia continued to be the leading export destination for Turkish citrus. Iraq, Iran, Ukraine, Romania, and Saudi Arabia were also important markets. Orange exports increased significantly from MY 2009 to MY 2010. Exports reached 330,000 MT in MY 2010 and are predicted to increase further in MY 2011. This is mostly due to the introduction of Turkish citrus to the Iranian market and price competitiveness compared to other countries. Russia, Iraq and Iran became the top three export destinations for Turkish oranges in MY 2010 followed by Ukraine. They are predicted to continue to be among the top export destinations in MY 2011 as well. Tangerine exports bounced back from MY 2009 level and reached 450,000 MT in MY 2010. This increase was much more then exporters expected, but it was mostly due to the price competitiveness of Turkish tangerines. Russia, Iraq and Ukraine continued to be the top export markets for Turkish tangerines. In MY 2011, exports of tangerines are predicted to decrease to 400,000 MT mostly due to the economic crisis in the most importing countries. Traditionally more than half of Turkish lemon production is exported. In MY 2010, lemon exports increased slightly compared to the previous year and reached 457,000 MT. Increasing lemon production is expected to be reflected in export volumes in MY 2011, as exports are predicted to reach 500,000 MT. Russia, Saudi Arabia and Iraq were top export destinations for Turkish lemons in MY 2010 and are expected to continue as such in MY 2011. High production levels of grapefruit are also predicted to be reflected in MY 2011 export volumes. In MY 2010 grapefruit exports were 153,000 MT. They are estimated to increase to 180,000 MT in MY 2011. However, the quality of the crop is not expected to be very good in MY 2011 due to the high level of production. In addition to this, the size of the fruit is not as big as requested from Western European countries. Russia, Romania and Ukraine continued to be top export destinations in MY 2010. Stocks: Since little citrus is processed, stocks of fresh citrus generally are not significant. Wholesalers, however, often prolong the season by storing citrus, primarily lemons, in cold storage or in caves, particularly in Central Anatolia. Stocks of citrus products are limited and comprised largely of orange juice concentrates. Policy: Production Policy There are no citrus-specific production support programs. The government provides support to any producer who establishes any kind of fruit orchard using certified seedlings. All Turkish farmers receive direct income support payments. The Mediterranean Exporters’ Union, Adana Farmers’ Union and Adana Citrus Producers Union play significant roles in keeping statistical information, communicating producers’ problems to government officials, and conducting research. One of the problems producers are facing is the lack of different varieties. The Ministry of Food, Agriculture and Livestock’s Agricultural Research Institutes, along with Cukurova University, conduct research on improved varieties and better horticultural practices. These researchers help identify better varieties for export and improved agricultural practices, therefore increasing export potential. Individual large-scale growers also experiment with new varieties and have been responsible for the introduction of some new varieties. Trade Policy The Turkish government makes support payments to exporters and the rates vary each year. The Ministry of Food, Agriculture and Livestock gave a subsidy to citrus exporters of USD 125/ MT in 2011. There is also a minimum price requirement for this specific subsidy. The government makes payments to a special account, which the exporter can only use to make tax and social security payments as well as utilities such as telecommunications, electricity, and natural gas. In order to protect domestic producers, the government kept the customs duty rates at 2007 levels for orange juice and citrus imports, which are 54 percent. Marketing: Marketing of fresh citrus and orange juice in domestic and international markets is handled mostly by the private sector; however government-sponsored Exporters’ Unions play a role in market promotion activities, mostly in the form of market research and information about production methods and volume. Domestically consumed citrus is transported in open trucks with minimal packing. However, the citrus packed for export is transported in refrigerated trucks. There are three channels for citrus distribution: It can go from producer to wholesaler, who then sells either directly to consumers in local wet markets or sells to a broker. The broker then sells to a retailer who eventually sells to consumers. Sometimes the producer sells directly to the broker who then sells to the retailer. The wholesale markets play a significant role in the sale of citrus. Citrus producers or exporters do not have a nationwide organization focused solely on marketing of citrus. Production, Supply and Demand Data Statistics: Oranges, Fresh Turkey 2009/2010 2010/2011 2011/2012 Market Year Begin: Oct 2009 Market Year Begin: Oct 2010 Market Year Begin: Oct 2011 USDA Official New Post USDA Official New Post USDA Official New Post Area Planted 51,700 51,700 51,700 51,700 51,700 Area Harvested 50,000 50,000 50,000 50,000 50,000 Bearing Trees 13,000 13,000 13,000 13,000 13,000 Non-Bearing Trees 1,000 1,000 1,000 1,000 1,000 Total No. Of Trees 14,000 14,000 14,000 14,000 14,000 Production 1,690 1,690 1,710 1,710 1,730 Imports 30 30 32 30 30 Total Supply 1,720 1,720 1,742 1,740 1,760 Exports 209 209 345 330 350 Fresh Dom. Consumption 1,411 1,411 1,297 1,310 1,310 For Processing 100 100 100 100 100 Total Distribution 1,720 1,720 1,742 1,740 1,760 HECTARES, 1000 TREES, 1000 MT Lemons/Limes, Fresh Turkey 2009/2010 2010/2011 2011/2012 Market Year Begin: Oct 2009 Market Year Begin: Oct 2010 Market Year Begin: Oct 2011 USDA Official New Post USDA Official New Post USDA Official New Post Area Planted 25,200 25,200 25,200 25,200 25,200 Area Harvested 22,900 22,900 22,900 22,900 22,900 Bearing Trees 6,265 6,265 6,265 6,265 6,265 Non-Bearing Trees 590 590 590 590 590 Total No. Of Trees 6,855 6,855 6,855 6,855 6,855 Production 783 783 782 787 850 Imports 1 1 1 1 0 Total Supply 784 784 783 788 850 Exports 434 434 450 457 500 Fresh Dom. Consumption 290 290 273 271 290 For Processing 60 60 60 60 60 Total Distribution 784 784 783 788 850 HECTARES, 1000 TREES, 1000 MT Grapefruit, Fresh Turkey 2009/2010 2010/2011 2011/2012 Market Year Begin: Oct 2009 Market Year Begin: Oct 2010 Market Year Begin: Oct 2011 USDA Official New Post USDA Official New Post USDA Official New Post Area Planted 5,150 5,150 5,200 5,200 5,200 Area Harvested 4,850 4,850 4,850 4,850 4,850 Bearing Trees 1,030 1,030 1,040 1,040 1,040 Non-Bearing Trees 65 65 65 65 65 Total No. Of Trees 1,095 1,095 1,105 1,105 1,105 Production 191 191 210 213 240 Imports 5 5 6 5 5 Total Supply 196 196 216 218 245 Exports 154 154 160 153 180 Fresh Dom. Consumption 42 42 56 65 65 For Processing 0 0 0 0 0 Total Distribution 196 196 216 218 245 HECTARES, 1000 TREES, 1000 MT Tangerines/Mandarins, Fresh Turkey 2009/2010 2010/2011 2011/2012 Market Year Begin: Oct 2009 Market Year Begin: Oct 2010 Market Year Begin: Oct 2011 USDA Official New Post USDA Official New Post USDA Official New Post Area Planted 31,200 31,200 31,300 31,300 31,300 Area Harvested 27,450 27,450 27,450 27,450 27,450 Bearing Trees 9,100 9,100 9,150 9,150 9,150 Non-Bearing Trees 1,200 1,200 1,250 1,250 1,250 Total No. Of Trees 10,300 10,300 10,400 10,400 10,400 Production 846 846 855 858 874 Imports 4 4 7 5 5 Total Supply 850 850 862 863 879 Exports 330 330 450 450 400 Fresh Dom. Consumption 520 520 412 413 479 For Processing 0 0 0 0 0 Total Distribution 850 850 862 863 879 HECTARES, 1000 TREES, 1000 MT Orange Juice Turkey 2009/2010 2010/2011 2011/2012 Market Year Begin: Oct 2009 Market Year Begin: Oct 2010 Market Year Begin: Oct 2011 USDA Official New Post USDA Official New Post USDA Official New Post Deliv. To Processors 100,000 100,000 100,000 100,000 100,000 Beginning Stocks 1,050 1,050 950 950 850 Production 8,800 8,800 8,800 8,800 8,800 Imports 6,800 6,800 6,800 6,500 6,500 Total Supply 16,650 16,650 16,550 16,250 16,150 Exports 1,400 1,400 1,400 1,400 1,300 Domestic Consumption 14,300 14,300 14,300 14,000 14,000 Ending Stocks 950 950 850 850 850 Total Distribution 16,650 16,650 16,550 16,250 16,150 MT
Posted: 23 January 2012

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