5th April 2018 – Chinese Duty Increase Upsets US Dried Fruit Industry

The decision by the Chinese government to increase the import duty on US nuts and dried fruit will put pressure on US raisin exporters as it is unclear whether the duty will be paid by local Chinese importers or whether exporters will have to offer a discount.

This will be particularly difficult where containers are already afloat and it is to be hoped that a solution will be found soon. China and Japan have become important markets for US raisins, prunes and nuts, particularly pistachios and the sudden decision to increase duty by 15% will hit local US producers hard.

The position for the supply of US raisins to traditional European customers remains difficult, with steep cost increases and, in some cases, reports of a complete lack of offers and availability. Where offers can be found, select US Thompson seedless raisins are quoted between USD1.75-1.85 per pound c&f Felixstowe. This is a very high price for both the UK retail and industrial market and will undoubtedly reduce demand. It remains to be seen if US packers will move some of their inventory for sale to Europe, but the old maxim that it is best not to put all your eggs in one basket must surely be true today.

Recorded exports of Turkish sultanas have reached over 175,000 tonnes, with sales registered on the local Izmir bourse reaching 288,000 tonnes. The total 2017 crop of Turkish raisins and sultanas was recorded at 317,000 tonnes with an additional carry-over from the previous year. There should therefore be sufficient fruit to last through until the harvest in August. Our correspondent reports that the new crop is already far advanced with the harvest predicted to be up to two weeks earlier than usual. It is still a little early to have a bud-count and to be able to predict the tonnage, but early estimates suggest a similar sized crop of just over 300,000 tonnes, if there are no weather issues. Prices remain stable with good quality No. 9 sultanas quoted between USD1,700-1,800/tonne fob Izmir for shipments through until September. Turkish raisins remain at a significant premium of up to USD500/tonne on this figure, although this price should reduce when the new crop becomes available.

Turkish apricot prices have eased over the past few weeks as the continuing warm weather in Turkey has allayed concerns about a possible frost. The danger will not pass until the end of April, so buyers still need to be cautious. As an indication, whole pitted type No. 5 apricots with a SO2 level below the permitted 2,000 parts per million are quoted between USD3,750-3,850/tonne fob Izmir, with larger sizes such as No.2 USD500/tonne more expensive.

Exports of Turkish dried figs have reached a total of just under 40,000 tonnes as at the end of March, with exports of retail packs accounting for about 31,000 tonnes, fig paste just under 5,000 tonnes and diced and industrial figs 3,000 tonnes. Total exports to the UK are, however, only recorded at just over 1,600 tonnes, which reflects the UK’s continuing lack of interest for Turkish dried figs, compared with larger markets such as France, Germany and Italy. Prices remain firm with good quality natural or Lerida figs quoted between USD5,000-5,500/tonne fob Izmir, if stocks can be found. The closeness of Ramadan will increase domestic demand for figs and may put further price pressure on an already overheated market.

Demand for currants continues in the UK, fuelled by the lack of supply from Greece and, more recently, from South Africa where the new crop of South African currants is expected to be less than 50% compared with an average year, due to the drought in the growing area north of Cape Town. Spot prices have therefore increased considerably and currants are quoted anywhere between GBP2,500-2,800/tonne (USD3,520-3,940/tonne) ex-UK warehouse.