FRUIT AND TREE NUTS -- SUMMARY March 22, 2001 March 2001, ERS-FTS-291 Approved by the World Agricultural Outlook Board --------------------------------------------------------------------------- This SUMMARY is published by the Economic Research Service, U.S. Department of Agriculture, Washington, DC 20036-5831. The complete text of FRUIT AND TREE NUTS will be available electronically in about a week following release of this summary. --------------------------------------------------------------------------- Fruit Grower Prices Averaged Lower in 2000 The index of prices received by growers for fruit averaged 12 percent lower in 2000 than 1999. Prices declined for all major fresh fruit except apples. Prices for processing citrus also declined. The return to a more normal size citrus crop in 2000 after substantial losses in California from a freeze the preceding year, contributed to the overall price decline. The Consumer Price Index (CPI) for fresh fruit averaged 3 percent lower in 2000 than 1999. Consumers paid higher prices at the retail level for Red Delicious apples and bananas. Lower prices for citrus fruit, especially oranges, drove the CPI down. Barring any weather-related problems this spring and early summer, we can expect the 2001 CPI to continue lower than a year ago. This winter provided sufficient chill hours for the noncitrus crops to produce good supplies this summer and fall. The current citrus crop is forecast to be almost a million tons smaller than last year's crop, although it is still larger than the 1998/99 crop. If realized, the 2000/01 crop of 16.5 million tons would be the second smallest in the last 5 years. All the major citrus crops, except lemons, are expected to be smaller this year. Declines in crop size are predicted for the two largest producing States, Florida and California, but increases are expected in Texas and Arizona. Crop size is estimated to be 12.4 million tons, 7.1 million tons of navel and other early to mid-season orange varieties, and 5.3 million tons of Valencia, the late-season variety. The 2000/01 orange crop is forecast to be 6 percent smaller than the previous crop. Drought conditions and freezing temperatures in Florida contributed to the reduction in expected crop size. California's orange crop is projected to reach 2.2 million tons this year, 12 percent below the 1999/2000 crop. The number of fruit per tree was down this year, resulting in larger sized navel oranges than last year. Plenty of rain this past winter also helped fruit size. The Valencia orange crop is forecast to reach 938,000 tons in 2000/01, 7 percent below a year ago, but higher than the freeze-reduced crop of 2 years ago. Fresh orange exports are up so far this marketing year (November-December) over the same period a year ago. Exports increased to all major markets. Asian markets are strong this year, and orange exports to China have grown rapidly since it opened its market to U.S. citrus last year. Florida's orange production is expected to be 4 percent below a year ago. Lack of rain and cold weather for much of the growing season caused fruit size to be below average. Orange juice production is forecast at 1.4 million single-strength equivalent (sse) gallons, down 4 percent from last year but 16 percent above 2 years ago when there was a smaller crop. Juice yields are projected at 1.58 gallons per box, up from 1.55 gallons in 1999/2000. Despite the expected smaller level of production in 2000/01, juice supplies are predicted to be up 1 percent from last year. Record-large beginning stocks in October, the beginning of the new marketing year, coupled with an expected increase in imports without much change forecast in exports, result in the projection for orange juice supplies to total 2.4 billion sse gallons. Demand for fruit by processors should increase as harvesting of the Valencia crop picks up. The strong demand for the smaller crop should push prices up, benefiting growers. Prices have been low in the beginning of the season as processors reduced stocks. The U.S. grapefruit crop is forecast at 2.6 million tons, 6 percent smaller than 1999/2000, but still larger than the 2 previous seasons. The Florida crop, which accounts for 80 percent of U.S. production, is expected to decline 8 percent. The cool, dry winter in Florida this year limited fruit growth. Fruit size is the third smallest in the last 10 years. The small size and lagging maturity levels of the fruit have slowed utilization. Also slowing utilization are the large beginning stocks of grapefruit juice, reducing demand by processors. The lagging demand for grapefruit this year has lowered grower prices in Florida after 2 years of increases. Fresh grapefruit exports rose 1 percent from September through December 2000 over the same period the previous year. Exports to Japan and the European Union were higher. The 2000/01 lemon crop is estimated to total 927,000 tons, the largest crop since 1996/97. If realized, the crop will be 7 percent bigger than last year. Both California and Arizona are expecting larger crops. The large crop is putting downward pressure on grower and retail prices. Tangerine, Temple, and tangelo production are projected to be lower in 2000/01 than the previous year. The tangerine crop, the largest of the specialty citrus crops, is expected to be 16 percent smaller than last season's record-large crop. It is expected, however, to be larger than the crops for the 2 years prior. Tangerine prices have been averaging higher this year and should stay strong for the remainder of the season as imports decline. The 2000 utilized production of noncitrus fruit was estimated at about 18.2 million short tons, up 5 percent from 1999. Many fruit orchards and vineyards in California and Washington experienced generally favorable weather conditions during 2000 that have been conducive to high production. The good performance of many of the fruit crops in these two States balanced out production declines brought by weather problems in other regions. U.S. utilized production increased for grapes, peaches, strawberries, prunes and plums, blackberries, blueberries, raspberries, tart cherries, California figs and kiwifruit, and Hawaiian bananas, papayas, and pineapples. The preliminary estimate of the value of noncitrus fruit production for 2000 was a record $8.1 billion, up less than 1 percent from the previous year. Much of the increase came from a 5- percent increase in the value of the 2000 grape crop, the most valuable noncitrus crop in the United States. Based on the U.S. Department of Agriculture's (USDA) preliminary estimates, total U.S. apple production for 2000 is 10.6 billion pounds, down less than 1 percent from a year earlier. The average price for apples received by U.S. growers in 2000 was $300 per short ton, about the same as a year ago. The large Washington crop, however, will likely contribute to increased fresh-market supplies in the United States during 2000/01 compared with the previous year. Consequently, prices for fresh-market apples will likely average lower than a year ago. Freezing temperatures in late December and early January slowed the progress of Floridas 2001 strawberry winter crop. Shipments have been behind last year. While no major damage was reported, the prolonged cold weather delayed bloom. Also, wet fields resulting from irrigating to protect the crop from freezing temperatures hindered harvesting. Although shipment volume picked up by mid-February, overall shipments through early March were still down significantly from last year. In California, slightly smaller acreage is expected to be devoted to strawberry production this year. Increased plantings of new, everbearing, high-yielding varieties are expected to make up for some of the reduced acreage and keep production near last years record-high crop. Based on estimates from both Florida and California, domestically-grown avocados will likely be in abundant supply this year. Because overall domestic supplies in 2000/01 are anticipated to exceed last season, avocado prices are likely to average lower. So far, 2000/01 shipments from California during November to late February have been running 10 percent ahead of the same period in 1999/2000. Early indications point to another strong crop of California peaches and nectarines in 2001, according to industry sources. Abundant supplies of good quality peaches and nectarines are expected, but this same situation may not hold true for plums. Heavy rains in early March hampered pollination, particularly for early plum varieties that were already in full bloom. A strong growing season may put downward pressure on stone fruit prices this summer. However, if export markets remain strong like a year ago, the downward pressure on prices could be moderated. U.S. imports of Chilean fruit are projected to be up for 2000/01. Favorable weather throughout most of Chiles fruit-growing season has benefited the countrys production of apples, pears, table grapes, avocados, stone fruit, and kiwifruit for this marketing season. Improvement in both yields and quality for most of these crops point to the prospect of increased Chilean fruit imports into the United States this year. Also fueling the growth in Chilean shipments to the United States is the devaluation of the Euro against the U.S. dollar. Chilean exporters are shifting some fruit shipments to the United States that would normally be bound for the European market. Total tree nut production was 16 percent lower this year due to the alternate bearing nature of nut trees. Production was down for all nut crops except pistachios. Pistachio production reached a record 243 million tons in 2000/01. Bearing acreage was up for all the major California nut crops--almonds, pistachios, and walnuts. Macadamia nut bearing acreage in Hawaii and hazelnut bearing acreage in both Washington and Oregon declined for the third straight year. The smaller crops resulted in higher season- average grower prices for almonds, hazelnuts, and pecans. Despite a smaller crop in 2000/01, macadamia nut growers received lower prices for their crop, as did pistachio nut growers with their large crop drawing down prices. Printed copies of the Fruit and Tree Nuts Situation and Outlook report will be available in about 2 weeks. For more information, contact Susan Pollack 202-694-5251. The text of the report will also be available electronically via the ERS website at www.ers.usda.gov. END_OF_FILE