An apple glut in India is causing prices to plummet and some traders to abandon consignments at port, after many importers over-ordered following a very strong market from February/March to July.
“Too much fruit was ordered, especially out of the US and Chile,” Gagan Khosla, owner and ceo of importer NGK Trading told Fruitnet. “The rumour that duties on Washington apples were going up and that the local crop was delayed prompted most guys to stock fruit instead of selling it. The result is today you can find decent Washington reds on the market selling for US$25 – a loss of about US$12; and Chilean reds at US$17 – a loss of US$17 a box.”
Parth Karvat, executive director and head of global procurement at importer Yupaa, today (22 August) told Fruitnet that a lot of unsold stock remained.
“The demand in the months of February to June was very strong which led to importers to import higher volumes,” he said. “Everyone was also predicting a lot less volume of Indian apples to arrive and that they would come on stream much later than usual. Importers did get speculative and store Washington fruit to get better pricing in case the duties increased.”
Tarun Arora, director of importer IG International, added that a nine-day transport strikeand heavy rains over the coastal regions of India caused the market to not perform as forecast.
'This has made it difficult to move the product before the arrival of Indian apples, which has caused the situation of panic in the market by importers selling at very low prices,' he said.
The glut will have a knock-on effect on India’s 2018/19 apple import deal, since it is likely to delay orders of new season Northern Hemisphere fruit, all three importers predicted.
“Turkey is already pushing to start shipping Gala [to India], but I doubt there are any takers,” Khosla said. “From the estimates I have heard, we will need at least two months for the market to clear. This will impact new-season sales.”
“Only time will tell how much time exactly it will take for the stocks to be cleared,” added Karvat. “India will surely be behind in starting its procurement from the Northern Hemisphere.”
Speaking to Fruitnet today (22 August), Arora said he believed it could take at least four to six weeks before sales channels are clear enough for the new Northern Hemisphere apple deal to begin. And even then, demand could be weak.
Meanwhile, the response of some importers to the apple oversupply situation could have long-term, negative ramifications for the Indian market, since it could damage its global reputation.
“There is also another problem: importers are abandoning cargo at the port,” Khosla told Fruitnet. “There will be a lot of problems between shippers and these importers to reach a settlement.”
“It is unfortunate that certain importers are abandoning their cargo at the port,” added Karvat. “Some are even making false quality claims to recover market losses although the buying decision was purely theirs. This brings disrepute to both the image of Indian importers and India as a market.”
