Canadian Fresh Deciduous Fruit Annual 2009 - USDA FAS

Canada Fresh Deciduous Fruit Annual 2009 - USDA FAS


Cultivated and bearing area of both apples and pears continues on a downward trend in Canada. Bearing area for apples is forecast at 16,149 hectares in 2009/10. Canada’s pear bearing area is expected to drop by nearly 28 percent from 1,095 hectares to 791 hectares in 2009/10. The drop in cultivated area for pears is largely due to CanGro’s January 2008 announcement that it would close its St. Davids, Ontario canning facility – the last fruit canner in the province and the only Canadian cannery east of the Rockies. Overall better weather conditions is forecast to boost 2009/10 apple production to 410,000 MT which imports will continue to represent about 40 percent of total consumption and total about 170,000 MT. In 2009/10 pear production is forecast at 7,600 MT with the 70,000 MT of imports providing 90 percent of total fresh consumption.

Apples Based on preliminary industry reports, prospects point to higher production levels for the marketing year (MY) 2009/10 Canadian apple crop compared to the previous year. Sunnier weather during the spring this year compared to last year’s cloudy skies has greatly aided pollination. Better pollination has led to bigger, less misshapen fruit with the corresponding corollary of higher yields and better pack outs. Post forecasts that 2009 production levels may increase between four and five percent to reach 410,000 metric tons (MT). Canada Statistics nonetheless still anticipates that the cultivated area for apples will continue to fall in coming years. Cultivated area for apples is forecast to drop in 2009/10 by five percent from 20,300 hectares in 2008/09 to about 19,275 hectares due to the Canadian apple industry’s ongoing downsizing. Bearing area is forecast to drop to just over 16,000 hectares. Despite the overall good yields in 2009, especially in British Columbia (Canada’s third largest apple producing province), lower new plantings combined with high production costs and increased competition from imports from the United States and China are pressuring the Canadian apple industry to reduce its overall cultivated area.

Although apple production in 2009/10 was hurt by apple scab in Ontario (Canada’s largest apple producing province) during the summer followed by some hail and frost damage, British Columbia’s very good crop this year is mitigating any potential shortfalls. British Columbia’s strong showing in 2009 comes despite late-season hail storms in the important apple producing region of the Okanagan Valley (affecting mainly the areas north and south of Penticton) that damaged a portion of the crop. While British Columbia’s hail damaged crop has been picked, its suitability only for processing will likely drive down processing apples’ price.

Declining Bearing Area According to Statistics Canada, the cultivated area for apples during 2009/10 will fall to 19,275 hectares, or by over 1,000 hectares or 5 percent compared to the previous year. Likewise the bearing area dropped to an estimated 16,159 hectares. The decline in cultivated area is part of a multi-year downward trend that has seen cultivated area for apples drop an average of almost 3 percent over the past five years. Changing agricultural practices, resulting in higher density plantings in smaller areas, along with smaller producers exiting the industry due to production costs outpacing market returns is leading to a decline in cultivated area. Of the major apple-producing provinces, Ontario with 6,880 hectares under cultivation in
2009/10 is the largest followed by Quebec (6,232 hectares), British Columbia (3,602 hectares), Nova Scotia (2,226 hectares), and New Brunswick (243 hectares). The following chart illustrates the decline in Canadian apple production during the 10-year period from 1999 to 2008. Production over time evidences an average annual decline of roughly 4 percent during the ten year period. Due to market forces pushing production down it is unlikely that the 2009/10 higher forecasted production levels of 410,000 MT are likely to arrest the long-run downward trend.
Working against producers’ long-term commercial expansion is the declining profitability of apple cultivation. More affordable imports from the United States and China combined with high production costs and a strong Canadian dollar continue to force the apple industry to downsize. Many apple growers are responding to the evolving market situation by converting orchards over to new plantings of vinifera grapes and cranberries, as well as by turning land over for new housing development. Other growers intent on remaining in the industry are turning to newer, more popular varieties such Ambrosia and Honeycrisp and intensive planting systems in an attempt to remain competitive with imports. To assist producers adapt to industry pressures and changing markets, Canada’s federal and provincial authorities have established replant programs (see, Policy Section).

Pears Canada’s cultivated area for pears has dropped roughly by half since the late 1990s. The decline in area under cultivation is primarily the result of urban encroachment on orchards, negative growth in consumption, and the pear processing industry’s downsizing. Ontario, with 526 hectares dedicated to pear cultivation in 2009/10, continues to account for roughly two-thirds of Canada’s commercial pear production. British Columbia, with 243 hectares under cultivation, is Canada’s second largest pear producing province.