For the past six years, the Madagascan litchi industry has seen satisfactory campaigns. The organisation in place since the 2011-12 season, has it is true led to near-stagnation of export volumes to Europe, but it has guaranteed remuneration to all the operators. From 14 000-15 000 tonnes in 2010-11 to 18 000 tonnes in 2016-17, the quantities on the market have stabilised, and seemingly match the absorption capacities of the European market, over this short two to three-month campaign hinging on the end of the calendar year.
As the campaigns went by over the past decade, consumption became increasingly concentrated on the end-of-year holidays. Outside of this period, the supply to the European market remains erratic and distinctly smaller in terms of volume. Thailand, traditionally present from April to August, has long limited its export calendar in order to avoid confrontation with Israel in July/August. Still rare in April, litchis from this source are now abandoning the European market in June/July depending on the year, upon the appearance of fruits from other origins in significant, though still moderate, quantities. Hence Mexico, China and Vietnam, eager to occupy a place on the European markets, have gradually limited their dreams of conquest because of lack of interest from European consumers. At this time of year, the latter are keener on cherries and summer fruits than litchis, which have regained their exotic character, and so are offered at high prices
This sluggish trend has by contrast increased the importance of the Indian Ocean litchi season, which is set in the consumption habits linked to the end-of-year holidays, favoured by attractive prices. The concentration of consumption is clear in the run-up to the holidays. The supply of air-freight litchis from late October or early November represents the beginning of the campaign, though the high sale prices of these fruits and their limited volume restrict their success to a narrow circle. Conversely, sea-freight litchis on the market enjoy marked enthusiasm among European consumers. The omnipresence of litchis in the supermarket sector, the mass scale effect and implementation of promotions at revised prices mean that the product has a genuinely wide reach. Last holiday period, the litchi saw its consumption dip again, with its appeal among distributors dwindling. They switched rapidly to other flagship products to invigorate their stores. The celebration of Chinese New Year, in European countries with a large population of Asian origin, often governs marketing of the fruit. This mobile holiday must not fall too late in relation to the supply window of high-quality litchis. There are a variety of comments on this event by professionals, some regarding it as a top-up commercial opportunity, others as a small-scale phenomenon of little interest. Its impact on the end of the season depends above all on its position in the calendar and its appeal to the distributors.
The star shining bright over the Madagascan litchi industry for the past several years could dim somewhat in the next campaign. It should be specified that the 2016-17 trading campaign brought together the most positive factors for achieving particularly satisfactory results.
The very early nature of Madagascan production, as well as the end of 2016 calendar, helped sales of sea-freight fruits in week 49, providing four weekends of sales between the arrival of the first ship and the end of the year.
Matching the volumes shipped to high points in demand also contributed to achieving good economic results. Slightly increasing the volumes on two scheduled conventional ships and reducing the quantities shipped in containers at the end of the campaign proved a wise decision, smoothing out the sale prices. Rates held up better between start and end of the campaign than in previous seasons.
Fruit quality and conservation were also strong points of the 2016-17 campaign. Better coloration and taste quality, unanimously recognised, were powerful sales vectors, especially against the South African competition which this year presented standard produce of unreliable quality.
After the exceptional situation of 2016-17, it would seem unlikely for such as set of favourable circumstances to recur. Certain external factors already seem less favourable with the campaign a few weeks away. This refers mainly to the weather conditions which accompanied the flowering and fruit-setting phases. The Southern winter required to induce flowering of the trees was too mild and rapid. Temperatures rose considerably from the end of August, partially impeding the flowering phases. The lack of precipitation accentuated the phenomenon and hindered fruit development. So the trees have a lighter load, which should reduce overall litchi production. However, this reduction should be put into perspective, insofar as Madagascar’s production potential far exceeds the quantities exported every year. The island’s total production is estimated at 80 000 to 100 000 tonnes, while exports barely exceed 20 000 tonnes. The consequence will be expansion of the harvest zones to mobilise the quantities expected by exporters, thereby extending the time between harvesting and the fruits reaching the packing stations. The litchis could also have a limited sizing.
These natural factors will also make themselves felt on the market. The official launch of the campaign barely seems feasible before the end of November (end of week 47 or beginning of week 48, depending on how the various production zones develop). If we count the times for picking, packing and loading on the two conventional ships once again scheduled, the first sea-freight litchis will only reach Europe in week 50, rather than week 49 as last year. This week and the one sales weekend less for litchis will doubtless have repercussions on how the campaign proceeds. In this particular context, the operators study the best strategies to ship the fruits under optimal conditions for arrivals in Europe in weeks 50 and 51. The planned volumes will be equivalent to those of the previous campaign, but their breakdown will perhaps be slightly modified to take into account the later start. Hence the quantities shipped in sea-freight containers should be smaller, in order to promote market fluidity of the second ship’s cargo, sales of which will probably be staggered into the first half of January.
As regards the campaign organisation, the system in place for the past several years, and which has proven its worth, will be renewed. Since the last campaign, operators have continued their efforts in terms of organising stations and certification. Exporters are harnessing new outlets in Asia and the Middle East to diversify their shipments, as they had begun to do previously. As the European market is abundantly supplied, the quest for other outlets is currently the only way for Madagascan operators to increase export volumes.
The air-freight litchi campaign should also start later than in 2016. The first batches should go onto the market in the first half of November. This phase of the campaign could also be peculiar this year, insofar as production from Reunion and Mauritius are set for extremely low levels. Litchis will perhaps be rarer and more expensive than usual.
Pierre Gerbaud, consultant
pierregerbaud@hotmail.com
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