Peru Citrus Trade Expansion Expected to Continue in Season 2023/24

Figure 1: Peru’s Citrus Export Volume 2019-2023

Source: Tridge, Trade Map

Often becoming part of its agricultural export economy, Peru’s citrus trade has been increasingly prosperous and expanding despite climatic challenges, such as El Niño-related weather anomalies and unusual higher temperatures during winter. When contemplating the 2023/24 season, there have been apparent signs that the upward export trend will persist and gain even more momentum. As a result, Peru is regarded as an authority in the global citrus industry, with its market influence growing significantly over several seasons. Export quantities have hit all-time highs in recent seasons, and increased investment has fueled fruit development in recent years. During the last 25 years, Peru has gained a significant global market share for agricultural products. Substantial "hard" investments were made in irrigation infrastructure, processing and storage facilities, and logistics to develop value chains for high-value agrarian exports. Additionally, "soft" investments were made to improve market coordination, strengthen value chain integration, comply with quality and safety standards, and meet market entry requirements such as buyer-imposed private standards. According to the United States Department of Agriculture (USDA) Citrus Annual report, Peruvian mandarin/tangerine output is expected to reach 545,000 metric tons (mt) in the 2023/24 season, a 1% year-over-year (YoY) reduction.

Over the last five years, mandarin cultivation for export has increased from 4,628 hectares (ha) in 2017 to 9,249 ha in 2022. The most farmed types are W. Murcott (4,077 ha) and Tango (2,010 ha). However, the acreage for Satsumas Okitsu and Owari kinds has decreased from 2,000 ha in 2017 to 1,400 ha the year before.

Overview of the 2023/24 Season

Despite the expected decline, the 2023/24 Peruvian citrus season is well positioned to benefit from the improved production capacity achieved over the years through government-corporate collaboration. In particular, combining new irrigation technologies and precision agriculture will substantially increase production per acre as fields using such technologies are expected to see the responsible use of resources that align with sustainability norms. Additionally, citrus diversification in Peru has also increased consumer demand. The exclusion of late-season cultivars is essential because well-conducted late-season broadens the export window and provides the market with produce when all other producers are off-season. Therefore, filling this gap reduces price volatility and positions the seller as a year-long, stable source.

Peru is the fourth largest citrus supplier in the Southern Hemisphere, with a 6% market share and a total export volume of 250,000 mt. Mandarins and limes account for the majority of exports. The country has seen increased citrus production and exportation, particularly mandarins, lemons, tangelo-minneolas, oranges, and grapefruits.

Peru's citrus trade is uniquely positioned due to its geographical advantages. The country's distinctive climate enables the production of citrus fruits that meet the highest quality standards, catering to the most discerning markets. Moreover, Peru's counter-seasonal production cycle to the Northern Hemisphere provides a significant competitive edge, particularly in North America and Europe, which are regions with a consistently high demand for fresh citrus. The United States (US) remained the predominant destination for Peru's fresh citrus fruit. Although 2023 exports have plummeted 27.76 % YoY to 105,608 mt due to lower volumes, small fruit, and quality issues, the first estimations show positive remarks regarding citrus fruit size and quality. Other export destinations recorded constructive growth, with the Netherlands leading, soaring 37.85% YoY to 42,016 mt in 2023.

Climate change and global economic changes pose constant challenges. However, the Peruvian citrus sector has shown adaptability and resilience. Producers are increasingly embracing sustainable and organic agricultural practices, which meet the expanding worldwide demand for organic produce and reduce some of the hazards associated with climatic variability.

In the 2023/24 season, Peru's citrus trade outlook is promising. Favorable weather, constant investment in the new mandarine orchards, and global trade dynamics should recover citrus exports in the 2023/24 season. Tridge anticipates that Peru's citrus sector's adaptability, innovation, and international competitiveness will bode well for the future of Peruvian citrus exports.