Exchange rates key concern for California citrus

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Exchange rates key concern for California citrus

This shipping season, a strong U.S. dollar is the latest challenge to California citrus growers, who depend on export markets for good returns, according to Casey Creamer, president, and CEO of California Citrus Mutual, based in Exeter, CA.

In a Nov. 29 Zoom meeting with, Creamer indicated his members are facing many challenges, including water scarcity, transportation rates and availability, high production input costs, heightened competition with climbing U.S. citrus import volumes and a citrus market saturation. California Citrus Mutual indicates: “Farming costs have doubled in the past ten years with fertilizer, fuel, and water costs being the main drivers in recent years.”

If good amounts of rainfall don’t come in the next year – on the heels of four drought years – some California citrus growers will be facing ominous production decisions. Creamer stressed that grove planting strategy can be impactful to a farm for generations. 

Exports account for about 30% of California citrus sales, with Canada being the top export market. Export markets avoid some of the aforementioned national sales difficulties. Creamer notes that California’s harvest season was timed without a problem to serve the early Chinese New Year, which is Jan. 22. China which traditionally buys great volumes of California citrus, especially for its massive New Year celebration.

While shipping and logistics are a concern, California citrus peak export season is in the January-March timeframe, which otherwise is counter seasonal for many other agricultural products. Thus, he  anticipates shipping problems out of the key ports of Long Beach and Los Angeles will continue, but will be managed to meet consumer demands overseas. 

As to the higher value of the U.S. dollar, Creamer says California citrus exporters must simply do the best they can to find the most suitable trading countries and international customers who can buy despite currency exchange rates.

In part because California citrus volumes were well below average over last season, California growers have been able to access adequate farm labor. That said, the industry is increasing its use of H-2A labor resources and is encouraging legislative improvements to boost agricultural labor availability, Creamer indicates.

California’s 2022 Navel harvest began in mid-October, with Mandarins coming on in the first half of November. Lemons and grapefruit are harvested at various times of the year, according to Creamer.

On Oct. 13, 2022, California Citrus Mutual released its crop estimate. The 2022-23 Navel orange and Mandarin crops are up over last season’s utilized production, but still below average. Customers can expect excellent taste and quality from California citrus this season.

The 2022-23 Navel orange crop will be approximately 10% over the previous season’s utilized production, which was below average. The upcoming season crop is expected to be very similar to the previous season with excellent fruit quality and sizing.   Preliminary maturity tests show that the crop is progressing very well with high sugar content that well exceeds the “California Standard” for sweetness.

California’s Mandarin crop – including Clementines, Tangos, Murcotts, and other seedless varieties – is also progressing well in terms of quality and fruit size. Estimates indicate the Mandarin crop will be up by as much as 30% over the previous season, but still well below average production levels and nearly 30% below the 2020-21 record-breaking large crop.

“The high quality of this crop is the silver lining of a very costly growing season,” Creamer indicated in the October release.

On Sept. 1, the California Department of Food and Agriculture (CDFA) released its 2022 California Citrus Acreage Report.

The overall statewide bearing acreage is up 1.7% or 4,297 acres in 2022 compared to 2020. This is an increase from 251,231 total acres in 2020 to 255,528 in 2022.

Lemon acreage experienced the biggest increase of all citrus types, increasing by 3,765 acres or 8.8%. Acreage in 2020 was 42,929 and has now increased to 46,694 acres. All three citrus districts saw increases in lemon acreage.

Mandarin acreage jumped from 59,422 in 2020 to 63,282 this year, an increase of 3,860 acres or 6%.

Navels and Valencias both decreased in acreage from 2020 to 2022. Navel acreage dropped 2% from 112,592 to 110,509, a decrease of 2,083 acres. In 2020 total Valencia acreage was 26,924 but has since dropped to 25,528. This is a decrease of 1,396 acres or 5%.

All photos courtesy of California Citrus Mutual.

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