Citrus Australia Limited

Season Update

Riverina, Murray Valley
and Riverland
Queensland
Western Australia
Markets
Processing
Heat Units (HU)

Season Update

Processing
July 2007 Report

The 2006/07 Valencia crop is completed in all regions except the MIA where a limited volume of both contracted and non-contracted late season fruit still remains. There does not seem to be a problem with irrigation this month, and processors say they are constantly monitoring and following announcements from the water authorities.

It is a slow time of year for processing, but operators continue to run Valencia fruit and have now begun to crush the new season Navels. Stocks of both NFC and concentrate will be sufficient to meet demand until the next Valencia crop. Valencia fruit ratios remain low due to the usual end of season quality.

There is no new news on next season’s Valencia crop and processors say they will know more next month. There has been severely cold weather down the eastern seaboard but there have been not been any reports of damage to trees. Cold temperatures can cause fruit droppages and, in extreme cases, kill the trees. There are reports that some of the plantations under berry production have lost fruit.

Juice retail sales, which are generally slower over winter, have flattened out significantly over the past month, say industry sources, due to the excess rain and unusually low temperatures recently. The ‘route’ trade (milk bars, garages, restaurants etc) was hit particularly heavily. Nevertheless, bottlers claim the market has recovered over the last week. Meanwhile, processors state that they have been receiving enquiries from the big retailers trying to ascertain future pricing.

Overseas

Imported frozen concentrated orange juice (FCOJ) is becoming more attractive for Australian buyers with the weakening US dollar and the softer pricing for concentrate in Brazil. Brazilian offers are now between USD2300-2500/tonne and are expected to sink lower to be more in line with prices on the FCOJ futures market. Nevertheless, the Brazilian market is supported in the short term because current shipments are still from last year’s crop. The 2007/08 harvest in Brazil has just begun and looks good.

Source: Stef Worsley, www.juicemarket.co.uk

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