China Fresh Deciduous Fruit Annual 2009

China Fresh Deciduous Fruit Annual for 2009 from USDA FAS

Report Highlights: For MY 2009, China's apple production is forecast at 32 MMT, up 7 percent from the previous year because new plantings in the northwestern provinces have begun bearing. Concentrated apple juice (CAJ) production is projected to fall to 500,000 MT due to weak global demand. Apple and grape imports are projected to rise to 58,000 and 125,000 MT on continued strong domestic demand. China's apple exports are estimated at 1.46 MMT, up 25 percent from last year because of anticipated robust demand from Asia and the Middle East. Pear and grape exports are estimated at 470,000 MT and 85,000 MT, respectively.


Executive Summary: For MY 2009, China’s total apple production is forecast to increase to 32 MMT because new plantings in the northwestern provinces have begun bearing. Total apple acreage is expected to rise slightly. Concentrated apple juice (CAJ) production is forecast at 500,000 MT, down 18 percent from the previous year primarily due to weak global demand. Pear and grape production are expected to rise. In MY 2009 pear production is forecast at 13.8 MMT, up only 2 percent from last year (compared with an average increase of 6 percent within the past 3 years) as major producing provinces were affected by poor weather and disease. Pear acreage is stable and forecast at 1.08 million hectares. Grape production is projected to rise to 7.7 MMT, primarily due to acreage expansion. For MY 2009, apple imports are estimated at 58,000 MT, up 20 percent from MY 2008 on strong demand for high quality fruit and anticipated supply increases in Chile and the United States. Grape imports are estimated at 125,000 MT, also attributed to strong domestic demand. For MY 2009, China’s fresh apple exports are estimated at 1.46 MMT, up 25 percent from the previous year on anticipated robust demand from Asia and the Middle East. Pear and grape exports are estimated at 470,000 and 85,000 MT, up 5 and 34 percent from last year on growing demand from ASEAN and neighboring Asian countries.

Apples For marketing year (MY) 2009 (July-June), China’s total apple production is forecast at 32 million metric tons (MMT), up 7 percent from last year because new plantings in the northwest provinces have begun bearing. Production in major apple producing provinces such as Shaanxi, Shanxi, and Gansu is expected to rise by more than 10 percent, while other areas (e.g. Henan, Hebei, and Liaoning) are forecast to increase by 3 to 5 percent. Shandong (the largest apple producing province) production is projected to drop by 10 to 15 percent because of poor weather. MY 2008 production was revised to 29.8 MMT, which reflects official Chinese Ministry of Agriculture (MOA) data. Fruit quality continues to improve due to better orchard management, as high quality fruit receive a higher price and potentially a more lucrative return.

For example, some Shandong apple farmers (many have over 20 years experience) are prudently applying fertilizer and other inputs so that they can market a higher quality product. Application is also controlled by packing houses and other middle men, which contract out to farmers provided they use specific inputs and apply them at predetermined amounts.

This year, the Chinese Fuji apple’s appearance (overall uniformity and color) and taste (sweetness) have greatly improved, even in Shandong where the apple size is smaller due to colder temperatures and drought. Total apple acreage is expected to rise slightly. Provinces in the Yellow Plateau (Shaanxi, Shanxi, and Gansu) are still expanding fresh consumption apple planted area on continued strong domestic demand (international demand accounts for approximately 5% percent of production), while apple acreage in northern China including Shandong, Henan and Hebei is expected to remain stable because of limited available land for expansion. Fuji is the dominant apple variety in north China (over 65 percent of total production). Early maturing varieties (20 percent of total production), such as the Gala, are not as popular since they cannot be kept in cold storage for relatively long periods of time (Galas have more sugar content, which affects storage potential). MY 2009 production costs continue to increase from last year. Shaanxi and Shandong fertilizer prices increased by 10 percent and 30 percent, while pesticide prices rose 5 percent and 10 percent. Shaanxi labor costs are reported at USD $8.80 per day, up 20 percent from the previous year, while Shandong labor costs have risen to USD $13.25 per day, almost double from the previous year due to labor shortages. According to contacts in Shaanxi province, total agricultural input costs (not including labor) were USD $441 per hectare.

Pears For MY 2009, pear production is forecast at 13.8 MMT, up only 2 percent from the previous year (within the past 3 years annual growth was approximately 6 percent) as major producing provinces were affected by poor weather and disease. Part of the crop in Hebei (accounts for more than 25 percent of total production) was damaged due to two rain storms in July and August, while Huangguan pears (grown in the same province) suffered from “chicken paw” disease. Notwithstanding, overall pear quality has improved in the last few years because of better orchard management. MY 2009 pear acreage is stable and forecast at 1.08 million hectares. Major varieties include the Su, Ya, Cuiguan, Fengshui, Golden, Huangguan, Nanguo, and Fragrant pear. MOA estimates that the current total average production cost for pears (not including labor) is USD $86 per Metric Ton (MT).

Grapes MY 2009 (June-May) grape production is forecast at 7.7 MMT, up 8 percent from the previous year primarily due to increased acreage, which is forecast up 4 percent to 468,000 hectares. Greenhouse production is also rising based on steady market returns.

While acreage is generally not expanding in northern provinces like Xinjiang, Hebei, and Shandong, grape production has risen in southern provinces such as Zhejiang, Jiangsu, Guangxi, and Yunnan because of strong demand near the Yangtze River and Pearl River Delta. Among all the varieties grown in China, the Red Globe is the most popular (comprises 30 percent of total production). Runners up include Kyoho, Muscat, and Thompson Seedless grapes. The wine industry has developed rapidly in response to rising demand, particularly by health-conscious and wealthier Chinese consumers. According to industry sources, domestic wine production and imports were 698 and 163 million liters in 2008, an increase of 23 percent and 11 percent from the previous year.

Export For MY 2009, China’s fresh apple exports are forecast at 1.46 MMT, up 25 percent from the previous year due to robust demand from Asia and the Middle East. Russian purchases (the largest buyer of Chinese apples) are expected to slow because of the global economic recession. Post revised the MY 2008 export number to 1,173,259 MT to reflect official Chinese government statistics. In MY 2009, pear and grape exports are forecast at 470,000 and 85,000 MT, up 5 and 34 percent from the previous year on growing demand from ASEAN and neighboring Asian countries.