Most U.S. imports of South African citrus occur from June through November.
While orange and lemon outputs are projected lower, grapefruit and tangerine and mandarin production is projected to increase slightly in 2023 due to favorable weather conditions in major producing regions.
CHALLENGING TIMES
The South African citrus industry is facing several challenges, including accelerating farming input costs, high shipping rates, infrastructure inefficiencies and new phytosanitary regulations, the report said.
Because of that, the profitability and sustainability of the industry are under threat, which could limit future investments.
“Duty-free exports of citrus to the United States under the African Growth Opportunity Act (AGOA) are expected to continue their strong annual growth, as the United States is still considered a premium market,” the report said.
ORANGE OUTLOOK
Citrus orchards in South Africa account for about 238,000 acres, of which orange orchards represent approximately 45%. The area planted to oranges grew by almost 4% over the past seven years. However, orange acreage growth will be just 0.5% in marketing year 2022-23, the report said.
The report said South Africa’s orange production in 2023 will decrease by 1%, while exports will grow by 5%, based on higher production of exportable fruit and more favorable export conditions due to the weakened South African rand (currency).
The European Union buys 40% of South African orange exports.
South Africa’s exports to the U.S. are expected to continue to grow, benefitting from duty-free access under the African Growth Opportunity Act. Exports of oranges to the U.S. increased to a record of 59,192 metric tons in 2022, up 25% from the previous season.
GRAPEFRUIT
South Africa’s grapefruit area has grown by 18% over the past seven years, but the report said the grapefruit area is expected to flatten in the coming years due to softening in global demand.
Star ruby, due to its high global demand, is the predominant cultivar planted, accounting for 88% of the total area. The report said grapefruit production in South Africa is forecast at 420,000 metric tons in 2023, slightly above last season, based on above-normal rainfall and a return to normal yield.
South Africa’s grapefruit export forecast for this season is 220,000 metric tons, down 8% from last season. China was the leading market for South African grapefruit exports in 2022, accounting for 27% of global sales, followed by the Netherlands with 27%, Japan with 10% and Russia with 8%.
While total volumes are still low, grapefruit exports to the U.S. have been growing exponentially over the past 10 years, from 275 metric tons in 2011 to 6,184 metric tons in 2022. Another increase is expected for 2023, according to the report.
TANGERINES AND MANDARIN GROWTH SLOWS
The report said South African area planted to tangerines/mandarins (soft citrus) has increased substantially over the past seven years, driven by higher global demand for seedless soft citrus and relatively higher profit margins compared to other citrus types.
However, the USDA expects growth in the South African soft citrus area to slow down in 2023, with the relatively static planted area at about 74,000 acres, as decreasing budwood sales continue to be the trend.
“The industry is concerned that demand for soft citrus is softening in key markets such as the [European Union] and United Kingdom due to inflationary pressures on consumers and an expected weakening in economic growth,” the report said.
In 2022, the area planted with tangerines/mandarins increased by 2%, and the report said an expanding number of acres of tangerine/mandarin production are under netting to better control pests, enable better water-management practices and protect the fruit from adverse weather conditions such as strong winds, hail or sun damage.
More than 40% of the soft citrus area in South Africa consists of orchards five years and younger, meaning that a growing volume of soft citrus will reach the market in the coming years.
The report said tangerine/mandarin production will grow by 6% in 2023 to 680,000 metric tons. Meanwhile, the USDA forecasts South Africa’s exports of tangerines/mandarins will grow by 7.5% in 2023 to reach a record level of 560,000 metric tons on higher production and the availability of more reasonable shipping rates.
The EU and the U.K. are the largest foreign markets for South African soft citrus, accounting for 45% of total exports, followed by the U.S. (10%), Russia (10%), the United Arab Emirates (8%) and China (4%).
Tangerine/mandarin exports have not been affected by South Africa’s citrus black spot challenges in the EU market. “However, as with all citrus exports, foreign sales of soft citrus are under pressure due to higher shipping costs, local port challenges, and deteriorating road networks,” the report said.
LEMON PAUSE
The area planted with lemons and limes in South Africa has more than doubled over the past seven years, the report said.
“However, the positive trend in area planted with lemons/limes has flattened in recent years due to the bearish movement of export prices received by producers,” the report said.
Planting area for lemons is expected stable, the report said.
The report said 2023 lemon and lime production will shrink by 13% to 653,000 metric tons.
In 2022, South Africa produced a record 748,000 metric tons of lemons/limes, up 19% from 2021.
South Africa’s exports of lemons/limes are forecast to grow by 12% to a record level of 570,000 metric tons in 2023.
This estimate is based on an expectation of larger production volumes of exportable lemons, sustained growth in the EU and U.K. markets and growth in demand from the Middle East and Asian markets.
