Profitability under pressure for Aussie citrus

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Profitability under pressure for Aussie citrus

Australia's citrus industry has ramped up domestic promotion and expects increased exports to Asia, in a season marked by high volumes and currency difficulties.

Citrus Australia CEO Judith Damiani has told she expects good export volumes this year, despite the high Australian dollar and increased competition with Chile.

"We’re just starting to go into our export season so we’ve had our early navels come on the market and now we’re moving more into our winter varieties - we're seeing our exports starting to increase, and what we’re seeing is increasing into Asia, and particularly Japan," she says.

"The only real competition increase we’ve noticed has been from the Chilean oranges into the U.S. market. They have access, they’ve ramped up their volumes into that market and that is something that obviously is impacting on our program there and we’re just trying to work through it."

"No one's denying the tough situation we’re finding ourselves in, but at the same time it’s still early days for our navel season - we’re now starting to move into our Washington navel variety and our late navels too."

She says 2011 has produced a high on-crop for navels which has put grower returns under pressure, but the situation should pick up in the coming months.

"Once some of those other Southern Hemisphere countries move out of some of those markets, in August, September, October, it's always a good time for our late Lanes for export - unfortunately the exchange rate is going to impact on grower returns, but as we move into our mid to late navel varieties we're pretty hopeful things will pick up for us.

"We’ve also just launched a big national promotion campaign for navel oranges, so we’re trying to do our best to stimulate demand here on the domestic market so we can help the industry through the rest of the season.

"There’s a lot of things happening, it’s not just the Australian dollar, because everyone’s facing some sort of appreciation of their currency and I know some of the other Southern Hemisphere countries are as well, but it’s also fuel costs, transport costs are increasing, and cold treatment costs."

On the transport front, Australia has a geographical advantage in the Asian market and like many in the fruit industry its citrus growers are making the most of the opportunity.

"The industry itself is refocusing on Asia, not just on the trade but also on our protocol improvement, so we are very focused on getting some improvements in our key Asian markets. That's particularly South Korea, China, Thailand and even India, so we are looking at definitely improving market access."

Citrus imports and disease management

Damiani is not overly concerned about Mexico's intentions to export limes to Australia, but says pest management and quarantine control are a big concern at the moment.

"In any import request the only thing we’re really interested in is their pest status, so all we’re worried about is making sure we’re protecting our industry and any trade that happens into Australia has got the most stringent requirements for entry," she says.

"Citrus is one of the biggest imported fresh produce categories in Australia. We get imports from California, we get imports from Spain, from Israel, Turkey, Japan, New Zealand, and we obviously trade around the world as well, so as long as it meets our biosecurity standards and we work through that in a scientific way, then it's just part of what we do."

She says more needs to be done at the quarantine level in Australia to prevent the entry of Huanglongbing (HLB), or citrus greening disease.

"That is such a big concern for us over here. We’re putting a big effort into addressing two particular diseases for us - one's Huanglongbing, the other one is citrus canker.

"We’ve actually got trees close to Australia such as Papua New Guinea that have Huanglongbing, so we're very concerned about it. It's very close to our northern borders and I never think there’s enough being done on it.

"I’d love to keep pushing that so we can have enough surveillance, enough testing, enough skills, grower awareness and we’re working very closely with the Australian government and our plant health authorities to make sure we're protected against that particular disease."

Last week Silvio Lopes from Brazil's Fundecitrus highlighted the disease often shows up first in backyards and could spread easily from there, suggesting charismatic TV personalities take up the cause to inform the public about what HLB looks like.

"I reckon half the people won’t even know how to pronounce it. I love people who come up with ideas and I think it really is important to look at it," says Damiani.

"How do you make people aware of this disease? It’s very difficult, and if you want to get a personality on TV it’ll cost you a lot of money, so the other thing too is it’s just not easy to identify that particular disease; it looks so much like nutritional deficiency.

"I think we really have to look at ways of really boosting up our border protection, getting our quarantine authorities trained up in identifying it before it gets into the backyard areas.

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