Golden Wing Mau Report on Citrus Week 23, 2015

As southern hemisphere grape volumes continue to diminish on the market, earlier season Chinese fruits continue to come into production.  More grapes, cherries, plums and nectarines could be seen in both the market and local fruit shops.  The next notable expected increase in demand is Dragon Boat festival, which is in one and a half weeks’ time. This pickup in demand hopefully assisting fruit under pressure.

The weather in week 23 continued to remain warm in the south of China, with costal and more tropical areas remaining humid.  Rainfall in Guangzhou not being as severe as previous weeks, this welcomed by the market but not particularly noticeable. Week 24 is forecast to remain similar and warm in both south and east China, rainfall expected in Shanghai for the first part of the week as Guangzhou continues to receive thunder showers throughout the week.

For the citrus market last week in Shanghai and Guangzhou, northern hemisphere produce remained available on the market but remained limited, as a result the market remained positive as domestic stocks were scarce. U.S.A. late Navels showing reasonably good quality with the appropriate coloration, firmness with limited blemishes continue to move at between ¥290-330 (count #72/88, 20kg), as some sellers push prices higher by ¥20-50.  Spanish Late Navels mostly continued to be supported by the market returning between ¥200-230 (count #56/64, 15kg) as some arrivals with sever condition issues saw buyers unwilling to accept fruit at any price level.  

The lemon market saw little fluctuation in week 23 with available arrivals being added to stocks already available on the market.  South African lemons were widely seen in south China, but less frequently in more northern regions. As a result of less lemons further north, better prices could sometime be seen with U.S.A stocks in these locations although volume is also limited. Most South African lemons showing a fresher coloration than U.S.A lemons continued to find movement at between ¥210-240 (count #100/113, 15kg), with few arrivals able to find reasonable movement above ¥250 as some brands asked above ¥300. U.S.A lemons in Shanghai could mostly find movement at between ¥340-380 (count #165/140, 19kg), with some of the better quality produce selling above ¥400. Returns in Guangzhou however were ¥30-80 lower for U.S.A produce. To the side the updated lemon exports from South Africa, year to date volumes remain up at 459k cartons being sent till week 21 which represents a 9% increase compared to 2014 or over 360% compared to 2013. Week 22 has not yet been fully updated, as mentioned volumes come down gradually in departure week 20/21 however these departures will continue to arrive into a market with inventory.

Grapefruit came under further pressure in week 23 as more volume entered the market, both Shanghai and Guangzhou affected by the volumes. Overall quality of arrivals remains good, but buyers did scrutinize arrivals where possible in order to try purchase for lower values. Fruit showing more noticeable greenness, or marking pricing between ¥120-130 as most fruit could find movement at between ¥130-140 (count #40/45, 17kg), larger sized good quality fruit able to move at between ¥150-160. South African grapefruit departures to Hong Kong and China till week 21 were at 476k cartons, which equates to a 28% increase year on year or an increase of over 290% compared to 2013. As anticipated arrivals into the market during week 23 tested the market further, with importers trying to hold price above breakeven values.