The lemon sector in Tucuman - the principal growing region in Argentina - is in crisis, its leaders have said.

Labour costs have increased 10 per cent since last season and now the Tucuman citrus association ATC is concerned that the crisis of last season will worsen in 2006. “One of the main reasons has been the drop in prices on the open market for processed lemon products,” said ATC president Calos Parravicini. A worrying trend is that demand for lemons for processing is tending increasingly to fall as prices paid by factories do not cover growers’ production costs.

And this season producers are concerned that with an abundance of lemons in Spain and Turkey, demand in Europe for their product, which traditionally starts to arrive in the marketplace in May, will fall. To add to their woes, the cost of inputs has also risen and sea-freight rates are costly too - rising 40 per cent in 2005.

“Just as last year, prices were up to 15 per cent higher than in 2004, with the prospects this year for higher costs and lower prices, we could export about 25 per cent less than in 2005,” said Parravicini.

Last season some 378,107 tonnes were exported for a total value of $177.57 million - a 32 per cent value increase on 2004.

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