Report Highlights:
China's citrus production is forecast to drop by 4 percent from 14.9 MMT in MY 2004 to 14.5 MMT in MY 2005 due to cold temperatures and typhoons in major production areas. Acreage continues to expand and fruit quality continues to improve. Domestic consumption grows slowly and consumer preferences are shifting to higher quality and the perception of safer food. While China's citrus exports to neighboring countries are expanding, imports of oranges are declining.
Executive Summary
China’s citrus production is forecast to drop by about 4 percent from 14.9 MMT in MY 2004 to 4.5 MMT in MY 2005 due to cold temperatures and typhoons in Zhejiang and frost in Hunan.The MY 2006 production is expected to rebound to high levels as acreage continues to expand and more trees start bearing fruit.The citrus planted area is forecast at 17 million hectares in MY 2005, up 4 percent over the previous year, driven by government support and market profitability.Fruit quality continues to improve as good agricultural practices are adopted.
Market prices have been stable recently, but the prices are expected to increase given the drop in production.Citrus consumption grows slowly and some consumers are paying more attention to food quality and safety.While wholesale and wet markets still dominate the sales volume, supermarkets are attracting more urban residents.
Large trading companies are playing an increasingly important role in exports and domestic distribution, but most fruit is consolidated and marketed by small private companies and individuals.Citrus exports continue to expand, especially for mandarins, to Southeast Asia as the quality of Chinese citrus improves and is forecast to continue to expand as tariffs decline.Orange imports are likely to decrease faced with competition from domestic fruit.
Canned citrus production is forecast down because of decreased production in Zhejiang.Frozen Concentrated Orange Juice (FCOJ) imports are probably down because of rising prices in the international market.
Production
Citrus production down 4 percent due to frost in Hunan and typhoons in Zhejiang
China’s citrus production is forecast to drop by approximately 4 percent from 14.9 million metric tons (MMT) in the 2004 marketing year (Oct-Sept) to 14.5 MMT in 2005 marketing year (MY).The drop is mainly attributed to a frost reducing Hunan’s production by 20 percent to 1.5 MMT in late spring and cold temperatures and several typhoons in the coastal Zhejiang province, causing production to drop by more than 30 percent in this region to 1.33 MMT.While these two provinces are the second and fourth largest citrus producers, respectively, other major producing provinces, including the largest production area, Fujian, are expected to see stable or increased output in MY 2005, thus mitigating production declines in the above two provinces.
With Zhejiang being the leading mandarin producer in China, the country’s total mandarin production is projected to decline to 8.05 MMT, down nearly 6 percent from 8.55 MMT in the previous year.Orange production, however, is expected to increase by nearly 5 percent over the previous season to 4.45 MMT, because major producers like Guangxi, Sichuan and Chongqing have expanded planting areas and expect good harvests in MY 2005.The MY 2004 citrus production figures have been adjusted in line with official statistics.
Production costs are up again this year, with fertilizer up 20 percent in MY 2004.In Chongqing, for example, orange production cost is estimated at US$2,960 per hectare.In spite of rising costs of inputs, citrus production continues to be profitable and production is expected to rebound to a high level in MY 2006 as acreage continues to expand and more trees start bearing fruit.