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TURBULENT TRADE TIMES: WHAT OPPORTUNITIES FOR CITRUS?
CITRUS AUSTRALIAMARCH 2020
1
2
1
AUSTRALIAN CITRUS – HOW DOES IT COMPARE WITH OTHER AGRI EXPORTS?
3
6
4
5
WHAT IS THE WORLD EATING AND DRINKING?
CHINA CITRUS IMPORTS – WHERE SHOULD AUSTRALIA SIT?
8
DISCLAIMER
CONTENTS
AUSTRALIAN CITRUS – HOW DOES IT COMPARE WITH OTHER AGRI EXPORTS?
3
A$5.71
A$2.66
A$1.56
A$2.91
A$13.63
A$2.82
A$13.62
A$1.48
China
USA
UK
Canada
HK
NZ
Singapore
Germany
AUSTRALIAN WINE EXPORTS TO CHINA SURPASS FRANCE IN PRICE PREMIUM
4
Average Price realised1
Key Export Markets - 2018
Bottled Exports361.8m L (42%)
Bulk Exports467.1m L (55%)
66% - 32%
54% - 44%
19% - 81%
39% - 58%
88% - 0.3%
41% - 52%
85% - N.A.
15% - 85%
Exports to China by bottle price1
Value growth YoY - 2018
Sources: Wine Australia – Export Report June 2018
Note 1: Moving Annual Total June 2018
18%
23%
46%
50%
54%
66%
90%
94%
113%
141%
202%
220%
$15.0 - $20.0
$2.5 - $5.0
$5.0 - $7.5
$7.5 - $10.0
$10.0 - $15.0
Total Export
$30.0 - $50.0
<$2.5
$20.0 - $30.0
$100.0 - $200.0
$50.0 - $100.0
$200+
5
CITRUS EXPORT PERCENTAGE CONTINUES STRONG GROWTH
Australia Oranges & Mandarins Production & ExportsIn kilo tonnes
Source: ABARES, ANZ
-
10%
20%
30%
40%
50%
60%
-
150
300
450
600
750
900
2000-01 2002-03 2004-05 2006-07 2008-09 2010-11 2012-13 2014-15 2016-17 2018-19
Pro
du
cti
on
(k
t)
Oranges Mandarins Exports as % Production (Oranges) (RHS) Exports as % Production (Mandarins) (RHS)
6
MANDARIN EXPORT PRICES SEE STRONG GROWTH WITH EXPORT DEMAND
Australia Unit Export pricesIn AUD per Kg
Source: ABARES, ANZ
-
0.50
1.00
1.50
2.00
2.50
2000-01 2002-03 2004-05 2006-07 2008-09 2010-11 2012-13 2014-15 2016-17 2018-19
Un
it p
rice
(A
UD
pe
r k
g)
Navel Valencia Mandarins
7
-
50
100
150
200
250
2000-01 2002-03 2004-05 2006-07 2008-09 2010-11 2012-13 2014-15 2016-17 2018-19
Navel
Valencia
Mandarins
Meat and live animals
Dairy
Wool
Horticulture
All Agri exports
CITRUS PRODUCT EXPORT PRICE GROWTH IN LINE WITH BROADER AGRICULTURAL EXPORTS…
Australia Agriculture Export price growthRebased to 2000/01 level
Note: Values for Meat and Live Animals, Dairy, Wool, Horticulture and Agri exports are based on index values available in Table 4a of Agricultural Commodities Statistics Dec 2019 from ABARES; Values for Navel, Valencia and Mandarins are calculated based on export volume and value data
Navel Oranges: 149%Valencia Oranges: 189%Mandarins: 169%----------------------------------Meat and Live Animals: 201%Dairy: 135%Wool: 231%Horticulture: 167%All Agri exports: 149%
Source: ABARES, ANZ
8
-
20
40
60
80
100
120
140
160
180
200
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19
Navel
Valencia
Mandarins
Meat and live animals
Dairy
Wool
Horticulture
All Agri exports
…BUT HAS GROWN SHARPLY SINCE 2011/12
Australia Agriculture Export price growthRebased to 2011/12 level
Note: Values for Meat and Live Animals, Dairy, Wool, Horticulture and Agri exports are based on index values available in Table 4a of Agricultural Commodities Statistics Dec 2019 from ABARES; Values for Navel, Valencia and Mandarins are calculated based on export volume and value data
Navel Oranges: 174%Valencia Oranges: 175%Mandarins: 163%----------------------------------Meat and Live Animals: 159%Dairy: 117%Wool: 142%Horticulture: 134%All Agri exports: 131%
Source: ABARES, ANZ
9
CITRUS EXPORT SHARE OF OVERALL FRUIT EXPORTS REMAINING STEADY AT 30%
Australia Fruit Exports vs Citrus ExportsIn AUD million
Source: ABARES, ANZ
-
5%
10%
15%
20%
25%
30%
35%
40%
-
200
400
600
800
1,000
1,200
1,400
1,600
2000–01 2002–03 2004–05 2006–07 2008–09 2010–11 2012–13 2014–15 2016–17 2018–19
Navel Oranges (AUD m) Valencia Oranges (AUD m) Mandarins (AUD m) Other fruit Citrus as % of Fruit exports (RHS)
10
GROWTH IN GREATER CHINA MARKET FAR OUTPACES OTHER EXPORT MARKETS
Source: UNComtrade
Australia Citrus ExportsIn ‘000 tonnes
-
50
100
150
200
250
300
350
400
2010 2011 2012 2013 2014 2015 2016 2017 2018E
Japan China/HK USA Malaysia Singapore UAE
Indonesia NZ Thailand Canada Philippines Other
11
CITRUS EXPORTS TO JAPAN ON RISE POST FTA
Source: UNComtrade
Australia Citrus Exports (ex- Greater China)In ‘000 tonnes
JAPEA Signed on 15th
Jan. 2015
-
50
100
150
200
250
2010 2011 2012 2013 2014 2015 2016 2017 2018E
Japan USA Malaysia Singapore UAE Indonesia NZ Thailand Canada Philippines Other
12
POTENTIAL OPPORTUNITY TO MARKET MANDARINS TO GREATER CHINA
Australia Citrus Exports By CategoryMajor export destinations in 2018
Source: UNComtrade
-
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
GreaterChina
Japan USA ThailandSingapore
Malaysia UAE Vietnam NZ IndonesiaPhilippines
Canada SouthKorea
Sri Lanka
Oranges Mandarins/Tangerines Grapefruit Lemons Other citrus
WIDE UNIT PRICE DIFFERENTIAL ACROSS MARKETS
13Australia Citrus Unit Export Prices - 2017In USD per kg
Source: UNComtrade, ANZ
-
0.200
0.400
0.600
0.800
1.000
1.200
1.400
1.600
1.800
2.000
Greater China Japan USA Thailand Singapore Malaysia United ArabEmirates
Viet Nam
Oranges Mandarins/Tangerines
AUSTRALIA’S CITRUS EXPORTS ARE RELATIVELY CONCENTRATED
14
China/HK Japan USA South Korea
Indonesia ROTW
Source: UNComtrade, ANZ
Australia Exports1 – Trade Value (USD m)
Note1: HS Codes for commodities include Beef (0201, 0202, 020610, 020621, 020622, 020629, 021020), Sheepmeat (0204), Seafood (03), Fruits, Nuts & Vegetables (07,08), Wheat (1001,1101), Dairy (0401 – 0406), Wool (5101,5103-04,5106-07,5109,510510,510521,510529), Wine (2204), Sugar (170111, 170113,170114), Cotton (52), Forestry (44), Citrus (0805)
Trad
e v
alu
e (
US
D m
)
-
2,000
4,000
6,000
8,000
2005 2010 2014 2017 2018
Beef
-
500
1,000
1,500
2,000
2,500
3,000
2005 2010 2014 2017 2018
Sheep meat
-
200
400
600
800
1,000
1,200
2005 2010 2014 2017 2018
Seafood
-
500
1,000
1,500
2,000
2,500
2005 2010 2014 2017 2018
Dairy
-
1,000
2,000
3,000
4,000
5,000
6,000
2005 2010 2014 2017 2018
Wheat
Trad
e v
alu
e (
US
D m
)
Trad
e v
alu
e (
US
D m
)Trad
e v
alu
e (
US
D m
)
Trad
e v
alu
e (
US
D m
)Trad
e v
alu
e (
US
D m
)
-
100
200
300
400
2005 2010 2014 2017 2018E
Citrus
CHINA CITRUS IMPORTS – WHERE SHOULD AUSTRALIA SIT?
15
16
CHINA ACCOUNTS FOR ALMOST ALL BEEF GROWTH
World Beef Production & Consumption CAGR
Source: USDA PSD, ANZ
0.8
%
1.1
%
1.1
%
0.1
%
0.7
%
0.6
%
1.0
%
0.9
%
(0
.2%
)
0.7
%
3.2
%
1.9
%
2.3
%
1.6
%
6.9
%
0.2
%
0.9
%
0.8
%
(0
.4%
)
(0
.3%
)
(4.0%)
(2.0%)
-
2.0%
4.0%
6.0%
8.0%
2000-2020 2000-05 2005-10 2010-15 2015-20
World Production World Consumption China Consumption RoW Consumption
17
Volume245
(‘000 MT)
Value226
(USD m)
NEARLY ALL EXPORTS TO HONG KONG ENTER CHINA
Direct exports to HKVolume 274 (‘000 MT)Value 251 (USD m)
Direct exports to ChinaVolume 483 (‘000 MT) Value 459 (USD m)
China
Hong Kong
Volume36
(‘000 MT)
Value67
(USD m)
Hong Kong citrus exports to China was ~50% of volume and value of direct export to Mainland
Citrus trade (2018E)
Source: UNComtrade, ANZ
17
1
13
5
65
42
26
11
11
10
8
14
7
11
8
59
54
34
8
10
11
11
So
uth
Afr
ica
Au
str
ali
a
Eg
yp
t
US
A
Sp
ain
Israel
Th
ail
an
d
Peru
Oth
er
Asia
(ex
-H
K)
Volume ('000 MT) Value (USD m)
11
1
94
43
14
2.1
2.1
2.0
1.4
0.6
98
89
38
14
1.9
1.8
1.7
1.2
0.4
So
uth
Afr
ica
US
A
Au
str
ali
a
Eg
yp
t
Oth
er
Asia
(ex
-C
hin
a)
Tu
rkey
Th
ail
an
d
Arg
en
tin
a
Israel
Volume ('000 MT) Value (USD m)
18
GREATER CHINA CITRUS IMPORTS – A SNAPSHOT
USA
Peru
ArgentinaAustralia
New Zealand
Japan
Thailand
South Africa
Spain
Egypt
Turkey
Israel
Greater China Citrus Imports (2018E)In USD million
Source: UNComtrade, ANZ
245.6
156.5 142.9
72.7 34.9 12.9 12.1 11.9 8.5 2.4 1.9 1.8 1.6 1.2
SouthAfrica
Australia USA Egypt Spain OtherAsia
Thailand Peru Israel Myanmar Japan Turkey NewZealand
Argentina
19
-
5
10
15
20
25
30
35
40
2001/2002 2003/2004 2005/2006 2007/2008 2009/2010 2011/2012 2013/2014 2015/2016 2017/2018 2019/2020
Oranges Tangerines/Mandarins Grapefruit Lemons/Lime
TANGERINES/MANDARINS DRIVE CHINESE DOMESTIC CONSUMPTION
Greater China Fresh Citrus ConsumptionIn million MT
Source: USDA PSD, ANZ
CAGR (2001/02 – 2019/20)Total Consumption : 6.4%Oranges: 3.7%Tangerines/Mandarins: 7.6%Grapefruit: 6.6%Lemons/ Lime: 2.2%
20
-
50
100
150
200
250
300
350
400
2001/2002 2005/2006 2009/2010 2013/2014 2017/2018
Citrus
Almonds
Apples
Cherries
Walnuts
Dairy
Beef
Wheat
CHINESE CITRUS CONSUMPTION HAS GROWN NEARLY THREE TIMES OVER PAST TWO DECADES
Greater China Domestic Consumption Rebased to 2001/02 consumption
Source: USDA PSD, ANZ
Almonds: 950% Cherries: 978%
Walnuts: 293%
Citrus: 295%
Dairy: 247%
Apples: 239%
Beef: 179%
Wheat: 121%
SOUTH AFRICA REMAINS THE MAJOR CITRUS COMPETITOR FOR AUSTRALIA IN GREATER CHINA MARKET
21
Citrus exports to Greater ChinaIn ‘000 tonnes; Major exporters – account for over 90% of exports
Source: UNComtrade
-
100
200
300
400
500
600
700
800
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018E
South Africa Australia USA Egypt Spain Thailand
AUSTRALIA AND USA HAVE COMPLEMENTARY MARKETING WINDOWS IN GREATER CHINA MARKET – HOW WILL THE TRADE STOUSH IMPACT THIS?
22
Citrus exports to Greater ChinaIn ‘000 tonnes
Source: UNComtrade
-
5
10
15
20
25
30
35
40
45
Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 Apr-19 Jul-19 Oct-19
Australia USANote: Data not available for
USA monthly exports in 2019
-
20
40
60
80
100
120
140
Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 Apr-19 Jul-19 Oct-19
Australia USA South Africa
SOUTH AFRICA’S ACCESS TO GREATER CHINA DWARFS AUSTRALIAN EXPORTS
23Citrus exports to Greater ChinaIn ‘000 tonnes
Source: UNComtrade
Note: Data not available for USA monthly exports in 2019
RISE IN UNIT PRICES REFLECTS STRONG PERCEPTION OF AUSTRALIAN PRODUCE
24Citrus Unit export prices to Greater ChinaIn USD per kg
Source: UNComtrade
-
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018E
South Africa Australia USA Egypt Spain
WHAT IS THE WORLD EATING AND DRINKING?
25
WHILE ORANGE CONSUMPTION RISES, ORANGE JUICE CONSUMPTION DECLINES –THOUGH MOSTLY IN THE EU AND THE US
26
World Orange Juice vs Fresh fruit consumptionIn million MT
Source: USDA PSD, ANZ
-
0.5
1.0
1.5
2.0
2.5
3.0
5
10
15
20
25
30
35
2001/2002 2007/2008 2013/2014 2019/2020
mil
lion M
T
mil
lio
n M
T
World- Oranges, Fresh World- Orange Juice (RHS)
European Union- Orange Juice (RHS) United States- Orange Juice (RHS)
THE AUSTRALIAN DIET CONTINUES TO EVOLVE – HOW TO CAPITALISE ON THIS?
27Australia Domestic Consumption Change2000/01 – 2018/19
Note: Coffee consumption is change over 2002/03 & 2018/19, Fresh Oranges, Wine & Beer consumption is change over 2000/01 & 2017/18
Source: USDA PSD, ANZ
46.7%
(31.6%)
5.5%
154.2%
180.0%
(18.9%)(9.6%)
76.6%
98.8%
138.6%
0.5%
41.9%
(1.5%)
FreshOranges
OrangeJuice Apples Cherries Almonds Dairy Beef Pork Poultry Coffee Sugar Wine Beer
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