In this article we deal with the biggest threats of spanish orange, which is less and less competitive. Find out why your competitor South Africa has burst onto the market stronger than ever this past season. What does war have to do with Ukraine? Let's see it!
Why is the Spanish orange losing competitiveness?
Is not that Ukraine was a major importer of Spanish citrus. neither is it Russia, which since 2014 vetoes the entry of Spanish fruit in response to the sanctions for the annexation of crimea. It is a perfect storm that puts the Spanish orange at risk. The first thing we should point out is that a competitor from South Africa has come out. This is grown under less demanding sanitary standards for less expensive labor. Thus, its price is lower.
It had been present for some time in the markets europeans, only that his season did not coincide with the Spanish one. However, he has stood out this last season for his great volume, as well as for coinciding with that of Spain. In other words, it lasted until November, two months longer than usual. Thus, if the peak of sales of Spanish products began in October, this season has had to be delayed, or made at lower prices. At levels that have even been lower than production costs.
The sector of spanish orange Hope it's a one-off event. They would like it to be due to the problems experienced by the South African campaign, marked by the civil unrest, the closure of the port of Durban or the cyberattacks against its container terminals, among other things. As if that were not enough, the invasion of Ukraine has only made the situation worse.
What role does Ukraine play?
Now what to export to Ukraine it's impossible and do it Russia it is very expensive, many companies in the hemisphere need other markets. That is why they are launched, like the South African orangeto the countries of the European Union. In addition, the United Kingdom is no longer linked to European countries by the links it had before the Brexit. That is why now it no longer focuses its fruit imports on those of Spain or other countries of the South of Europe.
As if that were not enough, since before the war, oranges have also suffered from the inflationary spiral that affects the entire field. The prices of agricultural inputs are through the roof and this reduces the profit margins of the sector. Besides, the supply crisis has skyrocketed the costs of plastic or of cardboard, which are necessary in the distribution. What can Spanish orange producers do to save themselves? What future awaits them?
