Econostrum | Economic News in the Mediterranean

Good international health for Spanish citrus

Written by Francis Mateo, BARCELONA on Tuesday, April 23rd 2013 à 10:33 | Read 840 times

Spanish citrus still competitive for export (photo: F. Matéo)
Spanish citrus still competitive for export (photo: F. Matéo)

SPAIN. Valencia, Murcia and Andalusia are the three main citrus-growing areas in Spain. One of the few sectors that is benefitting from the dynamism of exports in areas particularly affected by the economic crisis. The citrus market is based on the global dynamics of Spanish fruit, whose export volume grew by 11% in 2012 (6.8 million metric tons) and 14% in terms of turnover (€5.7 billion).

Hence the satisfaction displayed by Lorenzo Reyes, President of the Association of Citrus Growers of Huelva, when 2013 got off to a great start: “Last year we saw a 5.7% increase in production, 90% of which was marketed internationally”. And early trends suggest that these Andalusian producers could continue in the same vein this year. First, because demand is steady in European countries, which now account for 80% of Spanish citrus production (Germany, France, the Netherlands and the United Kingdom), but also because exports are expanding to Eastern Europe, to Russia, and to a lesser extent, Canada. These opportunities are still relatively embryonic, but promising all the same.


Prices are holding

However, Spanish citrus producers remain vigilant, particularly in the face of competition from Mediterranean countries, especially the rise of Egypt, which is very well positioned in the orange sector. Especially as if Spain manages to compete in terms of production costs, it cannot compete at the same level in terms of logistics: “Shipping a lorry to northern Europe from the south of Spain costs around €3000, while the same quantity of citrus fruit can be transported by container from Egypt for less than €2000”, explains a Spanish fruit and vegetable merchant “ this perhaps explains, in part at least, the choice of some orange growers in Valencia who preferred to move into kiwis, this year”.

These logistical difficulties are also due to the overall economic conditions in Spain and the sharp drop in domestic consumption; lorries leaving to go abroad often return empty, transport costs by road have noticeably increased. And the alternatives are limited.

Another concern for Spanish fruit and vegetable producers are distribution quotient multipliers: “Farmers only receive one fifth of the selling price to the consumer, and margins were reduced by 20% in 2012 at the expense of the producer”, complains Lorenzo Reyes. Overall, prices are still at a good level: Castellon producers (Valencia region) can thus negotiate the sale of their clementines between 12 and 18 cents per kilo, which are very competitive rates for export.

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