Chronicle of raw materials

Oranges: the absence of Russia will weigh on the market

Audio 01:33

An Egyptian orange merchant in the Cairo market in Egypt.

REUTERS/Mohamed Abd El Ghany

By: Marie-Pierre Olphand Follow

2 mins

It's depression on the orange market.

Restrictions on access to the Russian market weigh on a sector that was already not doing well before the start of the war in Ukraine.

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It's mechanical, since the start of the war the volumes of oranges imported by Russia have been falling.

The closure of shipping lines, payment restrictions, and sanctions more generally do not facilitate shipments to the Russian market.

An important market for several exporters of fresh oranges – as opposed to oranges for juice – starting with one of the largest, Egypt, of which 262,000 tonnes of Egyptian oranges were imported in 2020/2021 by Russia

If we count the decline in Chinese orders in recent months, a quarter of the Egyptian market is heavily disrupted. 

An aging and inextensible market

In the coming months, other producers will be hit hard: these are South Africa and Argentina, which are starting their shipping campaign at the beginning of the summer.

However, the Russians buy between 7 and 10% of South African exports and 20% of Argentine oranges.

To this must be added the volumes, admittedly much lower, which no longer go to Ukraine.

These surpluses risk being transferred to the European market where consumption is already at its peak or even declining in certain countries such as France and Germany.

Unlike other citrus fruits like lemon, orange is an aging product.

In a market that is not expandable, it will be all the more difficult for the affected countries to attract new buyers.

Price down 20%

The inevitable consequence of the abundance is a fall in prices: the main variety of oranges currently marketed has lost 20% compared to last year.

To the demand which skates, are added rather good productions.

" 

explains Éric Imbert, economist at CIRAD (Centre for International Cooperation in Agronomic Research for Development).

Spain, the leading European supplier, again had a very satisfactory harvest this year, and that of South Africa should also reach a very good level and fuel the fall in prices a little more.

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