16th November 2018 – Brexit Uncertainty Continues to Unsettle UK Dried Fruit Industry

Prices of Turkish sultanas and raisins have continued to firm with major packers reporting difficulties in obtaining good quality raw material from local farmers.

The total Turkish crop is reported to be much smaller this year, but even so it is still early in the season for such significant price increases. Exports until the beginning of November have reached 67,860 tonnes compared with 62,420 tonnes last year at the same period.

Every week, between 7,000-8,000 tonnes of Turkish sultanas and raisins are being shipped from the port of Izmir: this is a high level. This year’s total crop of sultanas and raisins is generally estimated to be around 250,000 tonnes with a carry-in of at least 30,000 tonnes. This should in theory, be sufficient to meet expected demand but other dynamics may change this.

Prices on the local Izmir bourse could reach as a high as TRY10 per kilo (USD1.85/kg) for raw material for standard no 9 quality. At present, prices are between TL9.0-9.2/kg but they are expected to rise further. The value of the Turkish lira continues to advance against the US dollar and this is having a major impact on the cost of Turkish exports.

A question to ask, therefore, is whether suppliers and importers of Turkish dried fruits will be able to meet their obligations. There are already reports of late shipments and this is a concern for the UK industry. As an indication, good quality Turkish no 9 sultanas are quoted between USD2,050-2,150 per tonne fob Izmir with genuine Turkish Thompson seedless sultanas at a premium of around USD250-350/tonne on this figure.

If prices of Turkish dried vine fruits continue to increase, UK buyers may seek alternative origins. An obvious choice are dried raisins and sultanas from China and, as an indication, these are quoted around USD1,550/tonne c&f Felixstowe. This is a competitive price compared with today’s Turkish price, but import duty needs to be added and there are concerns regarding the consistency of the quality and the long shipping period. Other origins such as South Africa, Chile and Australia are also likely candidates, but new season fruits will not be available from southern hemisphere producers until March/April next year.

Exports of Californian raisins remain relatively modest compared with previous years despite a reduction in cost for the new crop. There does seem, however, to be a greater appetite from leading US packers to maintain and increase exports of US raisins to traditional European customers. This is welcome news and with the difficulties the UK industry may have this year with both Turkey and Greece there is certainly an opportunity for California to rebuild sales of Thompson Seedless raisins to Europe.

Export prices of Greek currants are reported to have advanced to between EUR2,800-2,900/tonne (USD/3,170-3,280 tonne) fob Piraeus for good quality provincial fruit. This is a very high price and must surely result in a reduction in demand by UK manufacturing customers, as alternative ingredients can be used as a substitute in the longer term.

Turkish dried apricot and fig prices remain broadly unchanged with strong demand for apricots and rather limited demand this year for figs. This reflects the high price of Turkish dried figs and the reluctance of customers in the UK to hold stocks if the product has not been sold. As an indication, good quantity Turkish Natural no 6 figs are quoted between USD5,000-5,100/tonne fob Izmir and it is unlikely that prices will decrease as of good quality stocks remain limited.