For those of you not in attendance, I have included several documents for your review, but here are the highlights;
· The total U.S. apple crop is up 3% compared to last season with most of this increase accountable to Michigan
– small sizes. Michigan is up 86% compared to 2010 at 26,100,000 bushels. The only consequential decline in volume was California which amounted to only 600,000 bushels.
· The EU apple crop is up 5% compared to 2010 and down 1% compared to the 5-year average. On the positive side, the UK crop is expected to be three weeks earlier than normal and of good quality, and the SH apple crop has cleaned up nicely. Two other interesting facts; apple consumption in the EU is decreasing – down to 18.1kgs/person and organic production is up 20% to 110,000MT’s.
· The Canadian apple crop is expected to be up 4.5% compared to 2010, and down 4% compared to the 5-year average. Quality looks to be good with a late start – similar to Washington. Mac’s continue to be 31% of the total Canadian production.
· Mexico is expecting to be up 12% (21.8 million bushels), the largest crop in the last five years. Two interesting facts; Mexico is negotiating with China on a Free Trade Agreement and the total apple market consumption in Mexico is 31.5 million bushels. The drug war continues to escalate and 2012 is a presidential election year.
· The Southern Hemisphere presentation was comprised of Chile, Argentina, and Brazil. As these markets are counter-seasonal, the discussion focused on future trends. Argentina’s apple production is decreasing, pear volume is increasing and concerns lie with the weakness of their currency. Brazil’s apple production is increasing, but exports are decreasing as domestic consumption increases. Chile had record high exports in 2010 with a 9% increase from January through July 2011. For 2010, Chile exported 60% of their total apple production.
The remaining topic covered was China – and this is where the discussion gets confusing. There are basically two sets of production figures as presented by Michael Choi of Zhonglu America Corporation – the industry and the Ministry of Agriculture.
· The 2010 apple crop volume was 33,263,000 metric tonnes, which was 5% above 2009. If I remember correctly, the original estimate was 30,000,000 metric tonnes.
· The 2011 apple crop volume is estimated at 31,600,000 by industry and 34,365,000 metric tonnes by the Ministry of Agriculture – take your choice.
· Over the last decade Fuji increased its varietal stronghold to 68.8% of all varieties – up a little over 3%.
· There remains a strong movement away from the Shandong Province in the East to the Shaanxi Province further inland – central China – capitalizing on the ‘better use’ of the land in the Shandong Province. This possess an interesting question: is the infrastructure in place to move the apple from Shaanxi to the distant Port Cities for export?
· Shandong is 24% of the total crop, acreage down, normal crop. Hebei 8% of the total crop, normal crop. Shaanxi is 26% of the total crop, acreage is increasing and it’s a good crop. Henan is 12% of the total crop and it’s a good crop. Shanxi is 8% of the total crop and decreasing in volumes as the land has better uses. Liaoning is 6% of the total crop, and it’s a large crop. Gansu is 6% of the total crop, and a good crop.
· The USDA estimated that 82% of the crop went fresh in 2010. However, Michael felt this number was over estimated with the correct volumes being 71% fresh and 25% processor.
Overall I am filled with optimism for the 2011 season for Washington’s apple growers looking at world apply supply, the weak dollar and continued excellent WA quality.