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Market Data 09/06/2017

Brazilian citrus market: Processors work at full capacity and harvesting should continue until early 2018

The pace of orange crushing in São Paulo State was in full swing in August, with eleven large-sized processors in operation. Still, agents from processors consulted by Cepea claimed that factories were operating at full capacity, due to high production in the citrus belt.

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The pace of orange crushing in São Paulo State was in full swing in August, with eleven large-sized processors in operation. Still, agents from processors consulted by Cepea claimed that factories were operating at full capacity, due to high production in the citrus belt.

Nevertheless, agents from the sector expect the crushing pace to continue firm until early 2018 (when only a few plants usually operate), since a larger volume is estimated for the 2017/18 crop, requiring a longer time for processors to absorb output.

The harvesting of early oranges from the 2017/18 crop, in turn, has already ended in the main citrus regions from São Paulo – activities started in February, one month earlier than they did last year. According to Cepea collaborators, the last volumes, mainly of american valencia, were collected this month and allocated exclusively to processors. In September, crushing in the main processors from SP State should be limited to pear oranges.

As for late oranges, small amounts started to be harvested in August and some growers have already sent the first volumes to those processors that need fruits with lower ratio (to blend with other varieties). However, processors should start receiving these fruits only between September and October.

Purchases in the spot market have been occasional since the beginning of crushing activities in 2017. This pressed down quotes between May and August, compared to the same months last year. Last month, prices averaged 19.30 BRL per 40.8-kilo box, harvested and at the processor, 3.5 % lower than in August 2016, in nominal terms.

2018/19 – The rains that hit São Paulo State in mid-August should favor the opening of the first flowers, which, in turn, will become the oranges of the 2018/19 season. As most plants were already sprouting in early August, the first flowers should start to open in mid-September.

For growers, the drought and the low temperatures in July and early August favored the plants. According to agents, the oranges development, mainly of the pear oranges, was the same among all citrus regions (sprouting), except for southwestern SP (Avaré), where open flowers and fruitlets were already observed, favored by the higher humidity in the area. With the recent rains, growers increased fertilization and preventive measures to avoid problems, such as blossom end rot, which may affect the flowers and hamper production.

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