California’s citrus industry is preparing for the spring exporting season for navel oranges to Asia and hoping Korean demand remains high.
According to the USDA-Foreign Agricultural Service (USDA-FAS), Korea’s orange imports spiked by 89 per cent to 124,600 tonnes between February and May last year after import duties were dropped by 20 per cent for shipments clearing customs between March and August under the KORUS free trade agreement that came into force on 15 March 2012.
Duties on oranges are scheduled to come off by another 5 per cent at the beginning of March, but there are doubts regarding demand meeting last year’s.
“The Korean economy is not all that good at the moment, so I don’t expect quite the same volume to be shipped (this spring) as in 2012,” said Shawn Park of VeriSource International. “For the whole of last season, there were around 9,500 container loads (of California navel oranges) shipped to Korea, but it may be more like 6,000 loads this year.”
“A lot of importers lost money over the last few months, especially during the Lunar New Year holiday, because there was too much fruit in the market,” said Park. “Also, the weather in Korea was very cold, which didn’t help demand. Now we have a ‘GRI’ (general rate increase) of US$500 per container on oranges (implemented) by the steamship lines, which won’t help demand, either. I’m sure there will be a lot of fruit shipped to the Korean market over the next few months – but how much is the question.”
Reports from the California orange industry say that navel quality this year is generally good – especially with respect to sugar levels – but that fruit diameter is trending smaller than in 2011/12, with more count 88s and 113s and fewer 72s and 56s available.
