The prospects are particularly clear this year due to a production shortfall in the Northern Hemisphere, bearing in mind that the European market is expected to exhibit strong demand for the apple and certain pear varieties. Hence there could be strong prices, especially with competition intensity expected to be low because of the production shortfall in Argentina and South Africa, although the favourable parity with the dollar could encourage exporters to target the European market.
Prospects for Southern Hemisphere apples and pears are rather rosy this year, given the shortfall in the Northern Hemisphere. As a reminder, the European apple harvest was 21 % down on 2016 (9.43 million tonnes, i.e. 17 % below the 5-year average), while the pear harvest was 1 % down (2.18 million tonnes, i.e. 4 % below the 5-year average). This follows on from the frosts in April and May, which hit Northern and Eastern Europe particularly hard, as well as high-altitude Alpine zones. The USA registered an average apple and pear harvest (3 % down on 2017).
However the beginning of the season seemed to bring a gloomy start for the fresh market, given the shortfall in European production and in Southern Hemisphere leftovers bound for the big export destinations. Conversely, the industrial market was very lively, with prices soaring in order to maximise the volumes captured to supply the processing factories (juice, purées). Hence the apple shortfall, still barely noticeable in the autumn, started widening from January. Stocks melted away, with just 2.4 million tonnes left on 1 February 2018 (32 % down on 2017, as opposed to 28 % down for January, i.e. 31 % down on the 2014-2016 average), with a marked shortfall in Northern Europe and the Alps (- 78 % in Belgium, - 41 % in the Netherlands, - 44 % in Germany, - 39 % in Italy and - 41 % in Switzerland), but also in Poland (- 33 %). Stocks are now below normal in France (- 5 % as opposed to + 5 % in January), with export levels still very good to Germany, Benelux, Scandinavia and the United Kingdom.
Conversely, although North European production is in shortfall, there are still decent stocks of pear due to an abundant harvest in Southern Europe. Stocks were still similar to last year on 1 February 2018 (- 1 %), in the absence of the Portuguese figures. However stocks are lighter throughout Northern Europe and the Alps (excluding Italy), as well as Eastern Europe. Belgium, for example, registered a 19 % fall from 2017, and the Netherlands a 14 % fall, though the stock was up by 28 % in Italy, with probably a good level too in Portugal, since it was up by 19 % on 1 January 2018.
Hence certain apple varieties are already coming to the end, since they were taken out of storage on a priority basis this year due to specific demand from Northern Europe for Braeburn and most bicoloured varieties except for Gala. European stocks are particularly light in terms of Jonagold/Jonagored (61 % down on 2017), Elstar (- 71 %) and Braeburn (- 35 %), whereas there are good volumes for Gala (- 4 %) and Pink Lady (- 12 %), whose sales should pick up as availability of other bicolored varieties dwindles. Golden has a very clear market (- 34 %). Only Granny stocks are bigger than last year (+ 8 %).
For the pear, the pressure could fade earlier for certain varieties such as Conference, stocks of which for the moment are down by 9 %. There are still good volumes of Rocha (+ 19 % on 2017 on 1 January 2018), and above all of Abate (+ 33 % on 2017 and + 6 % on the 3-year average).
So exporters are gearing up in certain Southern Hemisphere countries, especially Chile where production is set for a good level (+ 4 % on 2017 and 5 % above the 3-year average according to sources) and above all in Brazil (+ 16 %). The same is true for New Zealand, where production is continuing to progress (+ 6 %), while a fall is expected in Argentina (- 19 %) and South Africa (- 6 %). The harvest forecast unveiled by WAPA at the Fruit Logistica show in Berlin indicated that the apple harvest should be similar to last year in the Southern Hemisphere (5 million tonnes, i.e. + 2 % on the 3-year average).
So in 2018 Chilean and Brazilian exporters are hoping for another year of good export potential. Brazil should be back to its 2015 level with approximately 60 000 t, although the sizing is set to be on the small side. Chilean exports could reach 780 000 t given the prospects in Europe, especially since the climate conditions were highly favourable in this country, with abundant rainfall during the autumn and winter. In New Zealand, the harvest could be particularly abundant and reach a record level, between expanding surface areas in recent years with the planting of modern varieties and some very good climate conditions. The Kiwis are expecting an 11 % increase in their exports (376 000 t), thanks to good demand in Europe and to continued growth in shipments to Asia. On the varieties side, the market should be well supplied with bicoloured varieties; especially for Gala, with the potential now actually rising to in excess of 2 million tonnes (+ 6 % on 2017); but also for Cripps Pink (400 000 t, i.e. + 4 %) and Fuji (757 000 t, i.e. + 3 %). Conversely, the potential is declining a little every year for Braeburn (117 000 t, i.e. - 2 %). Volumes are set to shrink for Golden Delicious (213 000 t, i.e. - 9 %) and Red Delicious (717 000 t, i.e. - 11 %), with the shortfall from South Africa and Argentina.
Pear imports from the Southern Hemisphere might not really increase this year, given the production shortfall. Hence WAPA’s forecasts for the campaign are fairly pessimistic, predicting an overall decrease of 17 % from 2017 (1 million tonnes, i.e. 23 % below the 3-year average). They are reckoning on a big production drop in Argentina and Chile, as well as to a lesser degree in South Africa; though it is being ravaged by an intense drought which is continuing to intensify, leaving great uncertainty over the potential actually available.
The harvest figures in South Africa have already been revised downward by Hortgro. The export potential could ultimately be 8 % less than in 2017 (202 200 t, i.e. 4 % below the 3-year average), with a 12 % fall for Williams (24 300 t, i.e. 8 % below the 3-year average), and probably for Abate (14 300 t, i.e. 14 % below the 3-year average). Comice is set for a 21 % fall (33 000 t, i.e. 16 % below the 3-year average) and Packhams for an 8 % fall (73 000 t, i.e. 5 % below the 3-year average). Shipments to the European market are for the moment well below normal (- 21 % on 2017 as at the end of February). Russia (+ 25 %) and the USA (+ 18 %) are taking in good volumes, with the rest divided between the various markets (40 % down on 2017).
Finally, a fall is expected in Argentina, after starting at full throttle. Export volumes as at 15 February were much smaller than last year (- 38 %), although they were still just 10% below the 3-year average. Shipments to Europe have been very limited until now (- 59 % on 2017 and 28 % below the 3-year average), especially those bound for Southern EU countries (Italy, France). Russia and the United States are capturing bigger volumes, though less than in previous years.
As for varieties, WAPA predicted a marked fall for Williams/Bon Chrétien (- 21 % on 2017) and Packhams (- 14 %) across the Southern Hemisphere countries.
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