China

New South Wales cherry growers turning to Chinese buyers

Cherry Growers Association Australia president Tom Eastlake is preparing for what could be a game-changing season. Eastlake is one of the many cherry growers around Young (New South Wales) gearing up to export their produce to China for the first time, thanks to relaxed new trade laws.

The climate around Young makes it prime territory for cherries and the NSW Department of Primary Industry said the Young region has seen some of the highest numbers of farmers registering to export to China in the state.

Growers have previously been restricted to sea-freighting their cherries to mainland China market because of Queensland fruit fly contamination fears. Now a new free-trade agreement between Australia and China has allowed growers to airfreight their produce after treating it for fruit fly.

Before the agreement, only growers in Tasmania could airfreight to mainland China, thanks to the island state being fruit fly free, while mainland Australian growers could export to Hong Kong.

But Eastlake said Chile was Australia's biggest competitor for the Chinese market. The South American nation could produce 200,000 tonnes of cherries this season, Mr Eastlake said, while Australian growers are hopeful for a record season this year of 18,000 tonnes.

"But it can be six weeks before the consumers are eating it [Chilean cherries]," Mr Eastlake said, with the majority of Chilean cherries moved by sea freight. Now, theoretically, Young cherries could find themselves on mainland Chinese shelves three days after being picked.

"You just can't beat something that's 72 hours from the tree. You just can't do it. The flavour's better. The appearance is better," he said. "Nowhere in the world can get things to South-East Asia as quickly as we can."

He said growers in Australia needed to get at least $8 a kilogram for cherries just to remain in the industry. "There's no money in it at $7 or $8. We're not making money hand over fist. We're not out there buying Rolls Royces."

Source: canberratimes.com.au via www.freshplaza.com 

Australian table grapes - forecast almost 18% above last year’s estimate

USDA GAIN report


Australia’s production of table grapes in 2018/19 is expected to be higher due to more favourable seasonal conditions, higher yields and a larger harvest area. This forecast is almost 18 percent above last year’s estimate, which was revised down due to poor weather, reduced yields, and a late season. Australian table grape producers are increasingly focusing on the growing export market as a result of strong international demand, especially from China.

Exports comprise almost 70 percent of production in recent years and are likely to grow further with the impending removal of Chinese tariffs on table grapes under the China-Australia FTA. Table grape imports, mainly from the United States, are likely to remain the same as 2018/19, primarily due to the strengthening U.S. dollar.

Production
Table grape production is forecast at 200,000 MT in 2018/19, up almost 18 percent on the previous year due to favorable seasonal conditions and higher yields. The harvested area is forecast to expand to 12,000 hectares in 2018/19, up 9 percent in anticipation of higher yields and an expanded harvest area.

Production in the previous year featured poor yields in a number of areas due to hotter temperatures. Most grape producers in Australia are small and medium-sized family businesses, with a few large growers. Sunraysia is Australia’s largest table grape growing region, producing an estimated 80 percent of total production. Early season regions include the Northern Territory and Queensland with 70 percent of late season production from the Sunraysia region of Victoria, based at Mildura and Robinvale.

Australian exports of table grapes, 2012-2017 (in 1,000 tons)

Click here for the full report.


Publication date : 11/23/2018

Source: www.freshplaza.com 

Michael Every of Rabobank: 'New Zealand could be forced to pick a side between US and China'

The US-China trade conflict is developing into a ‘cold’ war for global economic supremacy and could result in New Zealand being forced to pick a side between the two global superpowers, according to Rabobank’s Head of Financial Markets research for Asia-Pacific Michael Every.

And with this threat on the horizon, Mr Every says New Zealand’s agricultural sector should aim to reduce its reliance on individual trade partners and place an increased focus on diversification of its export markets.

Visiting New Zealand last week to speak at a number of Rabobank events in both North and South islands, Mr Every said he expected US-China relations to deteriorate further.

“The clash between the US and China is not going away, it’s not an aberration, it’s going to get worse,” he said.

“China and the US both want to be number one, they both want to be sitting in the driving seat for who gets to set the rules for the global economy and who everyone looks to as the global leader and there’s only room for one in that chair.”

Mr Every said increasing tensions could produce a scenario where New Zealand is forced to choose sides.

“China is aggressively pursuing trade expansion and there may come a time when a gun is put to New Zealand’s forehead and you’ll be asked are you with us, or are you with the US,” he said.

“If you answer the US, the Chinese could slam the door shut.”

Mr Every said China’s growing global influence and use of policies inconsistent with free trade had provoked the US to retaliate with tariffs on Chinese imports and other as anti-China trade policy.

“Last month the US concluded a new trade deal with Canada and Mexico, which requires them to notify the US before entering into any agreements with non-market economies such as China. This was economic warfare dressed up as trade and the type of move the US may try to employ in the Asia-Pacific region.” he said.

In March this year, 11 nations, including New Zealand, signed up to the Trans Pacific Partnership (TPP).

The TPP was originally intended to include the US, but it withdrew from negotiations in 2017. In January, however, US President Donald Trump signalled he could push harder for “substantially better" Pacific trade deal for the US.

“At some point the US is going to come crashing back into the Asia-Pacific region because it’s so geopolitically important,” Mr Every said. “And the message may well be that the price of protecting New Zealand is a new trade deal on their terms and which forbids, or greatly restricts, dealing with China.”

An ultimatum from either of the US or China would place New Zealand in a perilous position given its significant trade ties with both countries.

New Zealand’s agricultural exports to China have grown rapidly in recent years and China is now New Zealand’s most important trading partner. New Zealand also has a significant trade relationship with the US as well as historically strong diplomatic and cultural ties.

Mr Every said New Zealand farmers and exporters should look to diversify offshore markets, before any concessions are demanded by the US or China.

“New Zealand’s agricultural sector should be looking to further develop links into new growth markets like Japan, Indonesia and India,” he said. “While this may take a lot more effort in the short-term, it will leave agricultural exporters in a better position should the US or China start making demands down the track."

“New Zealand needs to look at it as an opportunity, rather than a threat, and ask ‘what brand can we build for agriculture that allows us to thrive’, because trade protectionism won’t go away.”

Mr Every said with increased market volatility likely, New Zealand farmers should also be taking a close look at their balance sheets.

“Farmers would be wise to shore up their balance sheets so they are robust enough to cope with a scenario where one of New Zealand’s major trading partners withdraws from the market,” he said.

For more information:
Rabobank.com 


Publication date : 11/13/2018

Source: www.freshplaza.com 

Australian cherry crop sizes up well

Early forecasts point to solid national crop, with mainland growers sending directly to China via airfreight
As Australia’s early-season cherry harvest gets underway, hopes are high for a record crop.

Cherry Growers Australia president Tom Eastlake said all major production regions were cropping well, with growers on track to surpass the 16,000 tonne mark for the first time.

“The forecast at the moment depends on how bullish you want to be … we would have to be starting this year at a baseline of 20 per cent higher than 15,000 tonnes, so it will be about 18,000 tonnes," Eastlake told ABC News.

“Assuming we don't have any adverse weather events come through, I would be reasonably confident we hit that mark."

Cherry growers in New South Wales are optimistic about crop forecasts, despite the state being in the grips of drought.

Water storage in the key production hub surrounding the township of Young is down, but many don’t foresee this as a wholesale problem.

“It means we just have to manage our water supply well,” Fiona Hall, managing director of Caernarvon Cherry Co, told Asiafruit. “Good management will mean there will be no impact on the crop as we hope for more rain through early summer.”

The dry spell, coupled with a warm winter, resulted in a later blossom in New South Wales, which has seen a later start to harvest for some growers.

Further south in Victoria, growers are reporting an above average fruit set, although some areas were affected by an early frost at budbreak. This has been compensated by a better than average fruit set on other varieties.

Michael Rouget, managing director of Victorian-based grower-packer-exporter Koala Cherries, said he was expecting a “normal crop to slightly above average" on his orchards.

Cautious optimism for China

Having secured significant market access improvements in January this year, the upcoming 2018/19 campaign will see mainland cherry growers send fruit directly to China via airfreight for the first time. However, it will be with an eye on laying the foundations for what the industry hopes will develop into a lucrative market.

“It is a positive step forward. People are optimistic but cautious given this is new territory for mainland cherry producers in Australia,” Rouget said. “I think this season most growers will trial shipments through this pathway but do it cautiously.”

The new protocol with China requires all mainland cherries grown outside recognised pest free areas to undergo methyl bromide treatment prior to export.

Hugh Molloy of Antico International says an adherence to high-quality will be crucial when it comes to developing market share in China.

“There is specific and unique demand for Australian supply if we can deliver consistent high quality, firm, sweet fruit,” Molloy told Asiafruit. “If this is established over November and December, the sales draw should then flow on into the Tasmanian supply window, which this year is perfectly suited to and timed for the Chinese New Year gifting period.”

 

Source: http://www.fruitnet.com/asiafruit

Author : Matthew Jones

Early Murcott Mandarin Variety Key to BGP’s Good Start in China

From September 5 to 8, the booth of BGP International, a Melbourne-based produce company, caught the eye of many attendees at Asia Fruit Logistica 2018 Hong Kong. Since its founding in 1992, BGP has strived to provide customers with high-quality fresh produce year-round through extensive cooperation with partners in Australia, the United States, Pakistan, India, Turkey, Egypt, South Africa, and New Zealand. Now, the company has also expanded operations to California, the Philippines, India, and Egypt. Produce Report interviewed Neil Barker, CEO of BGP, to explore how his company has done in China.

Citrus has been a key category for BGP, with the company’s annual citrus volume exceeding 40,000 metric tons. Relying on oranges, mandarins, and grapefruit from the world's leading production regions to develop the Chinese market has proven a sound strategy which pairs well with BGP's own strengths. The company’s strategy for China focuses on a special Murcott mandarin, the very early Murcott variety Royal Honey Murcott, which was discovered and patented by Ironbark Citrus, a producer of premium Australian mandarins in Queensland. This variety matures one month earlier than other Murcott mandarins and possesses a skin texture and taste profile which appeals to Chinese consumers.

As an appointed partner of Ironbark Citrus, BGP enjoys the privilege of being able to promote the variety in China before fierce market competition kicks in. "Until now, every year when the sales season kicks off for Royal Honey Murcott, demand is always two to three times greater than the volume available, so we have to restrict access to only a small number of specially-selected importers to better serve the market.” Neil continued however, noting that, "because we started with these early varieties, we are in a good position to go on with our later Murcott varieties."

For a first-hand account of this highly sought-after variety, Produce Report also spoke with Jing Huang, Assistant to CEO for Fruitday, a major Chinese fresh produce e-retailer, who confirmed the popularity of the Royal Honey Murcott in China. “This will be our fifth year marketing this variety on our platform. In addition to maturing early, Royal Honey Murcotts also boast a good appearance, excellent taste, high brix, and low acid content. As a result, it has been received well on Fruitday and is a perfect fit for the Chinese market.”

According to Neil, production of Royal Honey Murcotts is expected to double over the next 3 years and BGP will be working to continually increase market penetration for the variety in China.

Besides sourcing from Australia, BGP were also among the first companies to bring Chinese consumers mandarins, grapefruit, and lemons from Egypt. "We also expect some increases in these volumes in the years ahead. To achieve this goal, our grower partners in Egypt and South Africa are planting new farms with varieties specifically developed for the Chinese and Asian markets," Neil remarked. In addition to expanding the existing supply chain volumes, BGP is actively exploring new fruit varieties as well, such as avocadoes, nectarines, plums, and peaches, to further add value to its business in China.

BGP has been exporting premium Australian fruit to China since the early 2000s. Over the years, the company has developed into a crucial supplier to many upscale supermarkets, online retailers, and wholesalers in China. As one of the forerunners in marketing China-grown produce around the world, BGP has operated an office in China for a number of years to facilitate its exports of apples, citrus, garlic, and ginger to India, the EU, and other Asian markets. BGP was also involved in the early shipments of Ya pears (a famous type of pear native to northern China) to Australia.

Source: https://www.producereport.com 

 

 

Analysis of sudden price increase for Chinese fruit

As the seasonal market is changing, fresh fruit enters the market in large volumes. A quick look at this year's prices in comparison with last year shows that fruit prices greatly increased this year. One of the reasons for this development is quite obvious, the overall production volume decreased because of extreme weather conditions this year. However, looking at broader price developments shows that this price increase started much earlier than this year. The price of domestic fruit has been on the rise for several years now, and this is likely to be the prevailing trend in the future as well.

Well then, what are the reasons for this development?

Shrinking gap in product quality and product variety between domestic fruit and imported fruit
Imported fruit is not nearly as rare as it was on the market 10 years ago. As China opened the doors wide, more and more fruit importers have entered the Chinese market. The annual import volume of fruit continues to increase. In some situations the market even turned upside down, and imported fruit became a common sight. Under these circumstances, some consumers, suppliers, and plantation owners began to change their perception of domestic fruit:

First, various production areas in China have been importing fruit varieties from abroad for many years now, and this is particularly true for south China. Plantation owners experimented and adjusted until these fruit varieties performed well in Chinese production areas, and the fruit now produced in these areas is virtually indistinguishable from imported fruit, whether it is in terms of flavor or other characteristics.

Second, China continues to upgrade and innovate plantation technology and equipment in the agricultural industry. Plantation owners often apply glasshouse and greenhouse technology, and experiment with growing environments developed in agricultural production areas abroad. This also guarantees increased product quality for fruit produced in China.

Third, steady economic growth in China means that overall living standards have increased in recent years. Consumers enjoy higher average incomes and are able to spend more on food products. Consumers in China have begun to change their consumption pattern from quantity to quality. Farmers and fruit traders only have to improve the product quality of their fruit, and consumers are eager to pay extra. The proportion of top-quality fruit is still relatively small in the current fruit market. Increased consumer demand for top-quality fruit will eventually increase market prices.


Publication date : 11/2/2018

Source: www.freshplaza.com 

PMA Research: Impact of Chinese Tariffs applied to US Fresh Fruit Exports

Overview of Chinese Tariffs


The People’s Republic of China’s Ministry of Commerce (MOFCOM) on March 23, 2018 announced a proposal to levy retaliatory tariffs impacting approximately $2.0 billion in U.S. food and agricultural exports to China in response to the recent U.S. 232 Trade Action on steel and aluminum.

Additional tariffs of 15 percent would be applied to exports of fruits, dried fruits and nuts (among other products) from the U.S. in retaliation for tariffs introduced by the United States. Chinese customs began levying these additional tariffs April 2, 2018.

 

Read the rest of the article here

China's currency value has dropped dramatically

China’s currency has been losing points, hitting its lowest level against the US dollar in a decade. The reason behind this slide isn’t because of manipulation by the People’s Bank of China. The reason the yuan is being dumped now is that investors are concerned about a trade war between America and China.

The trade war will probably ensure, as all trade wars do, that both sides will lose. Alas, the wider global economy will too, as orders are lost and consumers and businesses globally pay higher prices for goods and raw materials, or suffer from “dumping” of exports previously destined for America and which now need to be sold off in a hurry.

If president Trump’s response is to intensify his trade war with the China, he will set up a vicious downward cycle, and where that will end should worry people. And China has quite some weaponry in this scrap: it holds some $1.2 trillion worth of US government bonds. This is where they have stashed all those trade surpluses with the Americans built up over a quarter of a century, according to an article on independent.co.uk.

Imagine if China decided to dispose of them on the bond market. Huge disruption – and a worldwide economic shock. Or even to run them down in an orderly fashion. The result would be higher interest rates hitting the American economy, whether Trump likes it or not. It would choke off US growth, and maybe even push it into recession. The dollar would be devalued as never before – which would help the US trade position and exports, but would also prompt a surge in American inflation and a squeeze on living standards.


Publication date : 10/31/2018

Australia's citrus industry set for another record year but nurseries run short of tree stock

Citrus growers across Australia have good reason to celebrate, with prices and global demand predicted to hit new records.

Chairman for Citrus Australia Ben Cant said the industry was booming, with growers getting twice or three times as much for their fruit than they were five years ago, and exports were steadily increasing.

"We've seen returns in the vicinity of $700–900 a tonne on navel oranges this season," Mr Cant said.

"In 2012/2013 we were looking at $200–300 a tonne, which is about our cost of production … so now we see fantastic returns for growers."

Sunlands citrus grower Mark Doecke said it had been an exceptional season for growers as weather conditions, fruit quality, and crop quantity had been great.

"Citrus has to be picked when it is dry and above 12 to 13 degrees, so this year with harvest we had no drizzle and no rain," he said.

"I feel for my brothers in the dryland farming but, as far as citrus picking goes, it's been excellent for us."

Sunlands citrus grower Mark Doecke says they've had great season with good fruit quality, weather conditions, and fruit quantity. 

And as demand is outstripping supply, Australian exports are predicted to have increased by 10 per cent this year.

Mr Cant said last year's official figures for citrus exports were around $480 million and they were confident to be a bit over $500 million in exports this year.

"And we could see $550–600 million in export next year," Mr Cant said.

"We've seen positive improvements in all markets, Japan has been about the same but China and the USA are up and pretty much everything across the board.

"Certainly, the demand for navel oranges continues to rise across key export markets like China and Japan."

Chairman for Citrus Australia Ben Cant says citrus exports are predicted to have increased by 10 per cent this season. 


Growers benefit with first harvest under new import rules to China. After years of negotiations the Chinese Government recognised the Riverland region as a pest-free area for all horticulture commodities late last year, and the benefits were being felt by citrus growers this harvest.

The fruit-fly free recognition for exports to China means growers do not have to cold-treat their produce, which results in faster and direct shipment and cost savings for growers.

The Riverland's fruit-fly-free recognition for exports to China gives growers a competitive advantage. 

Chair of Citrus Australia SA Region Steve Burdette said it was their biggest competitive advantage where additional cost for cold treatment would not have to be paid anymore.

"The fruit is a lot fresher when you ship it and eating quality is a lot more superior," Mr Burdette said.

"It created a lot more demand for our fruit into China."

Mr Cant said reasons for the high demand from China was their rising middle class prepared to pay for quality and the recognition of Australia's citrus as a premium product.

Citrus Australia market access manager David Daniels said there was a 50–60 per cent increase of exports to China from South Australia compared to last season, but this number was based on a low tonnage figure.

"China is the number-one market across the country, but that trade is primarily captured by the Victorian exporters. For South Australia, Japan is still a very strong market," Mr Daniels said.

"Returns to growers are better than ever."

Ben Cant says demand for navel oranges is certainly increasing. (ABC Rural: Jessica Schremmer)
"I would have to say everywhere we go, growers are very happy, with some saying prices are better than they have ever experienced in their lifetime."

Mr Daniels said the global demand for citrus was high due to an undersupply from competitor nations, where growers struggled with pest and disease hitting their produce.

Citrus plantings boom but many nurseries are sold out of trees. As global demand for citrus is expected to be strong, thousands of new citrus tree plantings are going into the ground across the country. But many nurseries are sold out of stock and do not have trees available until early 2020.

Mr Cant said there was a two to three-year wait for nursery stocks.

"We are on a massive growth trajectory, people are putting in trees of the preferred varieties as fast as they can right now," he said.

Chislett Farms nursery manager Jonathan Chislett from the Mallee region in Victoria said demand for trees was very high.

"We're sold out for this year and next but have capacity for 2020," Mr Chislett said.

"I don't have the exact numbers but it might be a couple of hundred thousand trees."

Mr Chislett said it was the highest demand he had ever seen and, as demand increased, nurseries were increasing their capacity to accommodate for it.

Engelhardt Citrus nursery owner John Engelhardt, located in the Orara Valley in New South Wales said he sold out of stock in July this year and would not be able to supply growers until January 2020.

"There is a lot of demand for citrus trees as the growers are getting reasonable prices for the fruit and also the export markets seem to be lucrative," Mr Engelhardt said.

"We are increasing production but at a reasonable pace."

Mr Cant said they were concerned about the volumes of trees coming on board but would work hard on opening more export markets.


ABC Rural
By Jessica Schremmer and Nadia Isa

Source: https://www.abc.net.au/news/rural/2018-10-19/another-record-year-for-citrus-industry/10388240 

China: Direct sourcing app for vegetables could be worth US$7B

A Chinese startup called Meicai that helps farmers sell vegetables to restaurants has reportedly raised at least US$600 million in a recent funding round led by Hillhouse Capital and Tiger Global Management, according to Bloomberg.

People familiar with the matter said the money will be used to expand as the startup competes for a bigger share of China’s fragmented food sourcing market.

According to one person familiar, the company raised about US$800 million at a valuation of about US$7 billion. Meicai was said to be valued at about $2.8 billion pre-investment in its previous funding round in January.

Meicai, which means “beautiful vegetable,” was founded in 2014 by Liu Chuanjun, a rocket scientist who set a goal of sourcing produce for about 10 million small- and medium-sized restaurants in China.

Using a smartphone app, customers can order specialties such as bok choy and Sichuan peppercorns directly from farms, disrupting traditional wholesaling by cutting out middlemen.

The funding round is among the largest for a Chinese startup this year, Bloomberg reported.

 

Source: https://www.freshfruitportal.com 

Trump's trade tariffs push Egyptian oranges to Shanghai fruit shops

The trade war between the United States and China is presenting opportunities for fruit distributor Sunmoon Food Co., as the company is now shipping navel oranges from Egypt, kiwis from Italy and apples from Poland into China for the first time ever. The produce is to fill the gap created when the Asian nation retaliated by slapping tariffs on U.S. fruit.

Sunmoon is not by any means a big company if one compares them to Fresh Del Monte Produce, for instance. Where the latter had a revenue of $4.1 billion last year, Sunmoon only had a turnover of $45 million. But the new business it’s doing in China underscores how the tariff tit-for-tat between the world’s two biggest economies is reshaping global trade flows. China imported $6.2 billion worth of fresh and dried fruit and nuts last year, up nearly ten-fold from 2015, according to customs data.

“As with any trade war or political upheaval, there will always be a certain re-balancing along the markets,” Gary Loh, Sunmoon’s chief executive officer, said in an interview. “Companies like ours can take advantage of this and introduce new products into new markets.”

Sunmoon counts China as its largest sales market, where it can reach 900 million mouths through its partnership with Shanghai Yiguo E-commerce Co., an Alibaba Group Holding Ltd. affiliate that owns more than half of the company.

When China raised tariffs on U.S. goods, Sunmoon responded by shipping navel oranges from a packaging house in the suburbs of Cairo to its warehouses in Shanghai. Other countries' oranges are being tested, like the ones from Israel, Morocco and Spain. These oranges are put out in the Chinese market with the chance of increasing shipments next year if the tariffs have not been removed.

Source: Bloomberg via: www.freshplaza.com


Publication date : 9/17/2018

 

Tariff elimination to boost Australian cherries in China, says importer

Australian cherries are set to benefit from the elimination of tariffs in the Chinese market from the start of next year, according to one importer.

A free trade agreement was signed between the two countries in 2014, with Australian cherry exporters to be subject to zero-tariffs in China from Jan. 1, 2019.

Huang Xianhua, general manager of Shanghai Oheng Import & Export Co., told Fresh Fruit Portal Australian cherries would therefore be on a level playing field with Chile in terms of tariffs.

Chile signed an FTA with China in 2005, and sends the vast majority of its cherries to the Asian country.

Xianhua added that Australia’s higher production costs compared to Chile would be partially offset by its relative proximity to the market, while will save freight costs and make the country more competitive.

Australia is expected to produce a record 18,000 metric tons (MT) of cherries this year, with a little under half due to be exported, according to a USDA forecast. Meanwhile, Chile is expecting to export similar volumes to last season, which saw a huge export rise to 180,000MT.

And according to Xianhua, Chile faces numerous challenges with cherries.

“The processing capacity during the peak of harvest is insufficient, production is easily affected by weather conditions, and the quality is inconsistent, but they are hesitant to invest in protection such as rain nets if the investment it too big,” he said.

U.S.-China trade war
Xianhua also said that the U.S.-China trade war has led to a poor performance of U.S. cherries in the Chinese market this year. China has risen tariffs on the fruit by 40% over recent months, with the latest round coming into effect on July 6.

“This is an enormous cost and is unable to completely be shifted to the consumer end. In the end, the importers have to pay this extra bill,” he said.

Many importers stopped bringing in U.S. cherries while those who continued have run into difficulties, he said.

Other origins have been unable to fill the supply gap, he added.

“There is no [country] that can fully replace it. Canada’s supply is still limited, and Central Asian’s season is too early, also the quality is not good enough and they also have to worry about cold treatment,” he said.

 

Source: https://www.freshfruitportal.com