January WAR 2010

January 2010, World Apple Report Highlights

Biggest Stories of 2009
This article lists the stories of 2009 that are likely to have a major lasting effect on the global apple industry. They are, in order, (1) Global Economy Unravels. (2) Consumers Battered. (3) Price Again King. (4) Discounters in Vogue. (5) Regulatory Zeal Returns. (6) Organics in Jeopardy. (7) Berries Become Formidable Competition. (8) Challenge of Aging Population. (9) Apple Industry Shrinks in EU. (10) Uncertain Impact of Global Warming. The biggest non-stories, issues that were expected to dominate but that showed little movement, included food safety, enhanced traceability, healthier eating, labor and immigration, and trade.

Staggering News from China
In a recent report, USDA,FAS forecast that China would produce 32 million metric tons of apples in 2009-10, a new record level. It also forecast that to absorb such a huge crop, China's domestic consumption of fresh apples would reach 20 kilograms per person and its exports of fresh apples would reach 1.46 million metric tons. Thus, the Chinese apple industry appears set to shake up both the domestic and global fresh apple trade. FAS also forecast that Chinese production and exports of concentrated apple juice would be lower because of reduced global demand. However, our analysis indicates that year to date figures do not agree with the FAS forecast. Fresh apple exports are up only 5.5 percent, while exports of concentrated apple juice are up 50 percent on last year's depressed levels. It remains to be seen whether or not the FAS forecast is correct.

Poland Shakes up European Trade
For the first time since Poland joined the enlarged European Union in 2004, Poland has had a major impact on fresh apple trade across Europe and countries to the east in the 2008-09 season. In 2008-09, Poland supplanted EU-15 countries as the dominant supplier of fresh apples to Russia, the Ukraine and Belarus. The presence of large quantities of lower-priced Polish apples in those markets also drove down the prices EU-15 suppliers received for their exports. Poland also began to make inroads at the low-price end of markets within the EU-15. While Poland can clearly continue to increase its share of exports with a low price strategy, there is a major question over whether it can modernize and sustain its apple industry on such low prices.

Special Statistics

Biggest Stories of 2009 (table).
European Union: Selected Trade in Fresh Apples, 2007-08 and 2008-09 (table).
United States: Estimated Average Advertised Retail Prices, first ten weeks of season, 2007-08, 2008-09 and 2009-10 (table).
EU-15 and Poland: Export Prices of Fresh Apples to Russia, 2007-08 and 2008-09 (chart).

The authoritative guide to the world apple business today.

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