South American Real Estate News

The two faces of the Argentine lemon industry: from the export boom to being oversupplied and then eaten by cows

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Some producers gave their lemons to the cattle farmers due to lack of profitability and oversupply, but in the first semester shipments from the sector grew 44 per cent in value.

A few weeks ago, the curious image of cattle eating thousands of kilos of lemons that had been discarded by citrus producers in northern Salta circulated in the media. The businessmen explained that since the market and the industries collapsed, the price of the product was too low and was not enough to cover harvest and transportation costs that had been rising.

But now, a report by the Agricultural Foundation for the Development of Argentina has been released stating that in the first half of this year, exports from the citrus sector increased by 42 per cent in volume and 44 per cent in value compared to shipments in the first half of 2021.

According to the report, Argentina exports approximately 90 per cent of its lemon production, either as fresh fruit or as an industrialized product. These products are lemon juice and lemon essential oil, a derivative widely used both in the manufacture of flavoured beverages and in the cosmetic industry and in which Argentina leads the global market with no less than 34 per cent of the exports.

The essence of lemon explained in the first semester 22 per cent of the value exported by the lemon complex, against 24 per cent of juices and 54 per cent of fresh lemons. Still, it was the item that moved the needle in the comparison year-on-year since it is the product with the highest relative value and the only one that experienced an increase in the average price.

Specifically, essential oils went from a price of $16,963 per ton in the first half of 2021 to a price of $23,962 per ton in the first half of this year, an increase of 41 per cent. Meanwhile, fresh lemons fell from 660 to 633 dollars per ton (-4%) and lemon juice went from 2,020 to 1,642 dollars per ton (-19%).

According to FADA details, essential oils are the only product of this complex that pays export duties, with an aliquot of 3 per cent, and in the first semester, they contributed 1.4 million dollars.

Another interesting piece of information provided by the FADA report is that the complex destined its exports to more than 44 countries. The United States explained 25% of the demand for products from the Argentine lemon complex, followed in importance by the Netherlands with 15%, Ireland with 12%, Russia with 8% and Spain with 8%.

“In 2021, Argentina ranked as the 6th exporter in the lemons and limes category, with 5% of the world market. Likewise, Argentina is the 1st exporter of lemon essential oils and 1st in lemon juice. This participation worldwide is of great value for the lemon complex, mainly if analyzed from a regional perspective since 96% of the complex’s exports originated from the NOA,” explains FADA.

Seen this way, it does not sound so dramatic that the northern hacienda adds kilos with the surplus of that thriving export complex.

Source: the Clarin

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Post available in: English Español

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