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Bearish South African orange market, amid COVID-19

August 24, 2020

1 mins read

The Mintec price of South African oranges declined by 41% to SAR 4,770/MT between the 4th March and 12th August, in line with logistical disruptions due to COVID-19 and the expectation of an uptick in production for the 2020 season.

The impact of COVID-19 has led to a rise in demand for South African oranges, due to the associated benefits of vitamin C in boosting immunity. However, export disruptions as a result of constraints on shipping lines, restricted availability of containers and port restrictions have led to limited international sales. As a result, the South African orange market remains bearish, despite an expected 3% rise in domestic consumption for the 2020 season.

In response to issues with port congestion and limited containers, the South African citrus industry have adapted and made use of conventional reefers and rail freight. This in turn, has had a vital impact on meeting international demand and provided some price support to the market.

South African 2020 orange production is expected to rise by 1% to 1.6 million tonnes, from 1.59 million tonnes in 2019. The expectation of a strong harvest for the 2020 season, coupled with further potential supply disruptions due to a possible second wave of coronavirus is expected to keep prices bearish over the next few months.

Ramnikh Kular

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