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Spectacular growth in major markets for fruit juices.

With total world trade in fruit and vegetable juices reaching almost US$4 billion in 1989 and an estimated $5 billion in 1990, the fruit joice industry has become one of the world's major agro-based businesses. The international fruit juice trade has shown spectacular growth over the last few decades, increasing threefold in value terms since 1980. The importance of this trade for developing countries is underlined by the fact that they account for about half of total world exports. Although one of them, Brazil, is by far the largest exporter, a number of other developing countries also supply fruit juices and pulp on the international market, and several additional ones have the potential to do so.

The fruit juice business will probably remain a growth industry for a considerable period of time. One reason is that annual per capita consumption of fruit juices and nectars is still fairly low in most markets, including several of the world's largest. Per capita intake is likely to go up in most of the industrialized countries, and possibly quite rapidly in some of them. Consumers are becoming more health conscious, a trend that started some years ago. In addition, product development, for instance new flavours, blends and packaging, by both bottlers and retail organizations, combined with more dynamic marketing, should help expand sales.

Increasing amounts of fruit huice raw material are being used in other foods and beverages, such as yogurt, yogurt drinks, health drinks, desserts and baby food, which should further stimulate demand.

The emerging markets of Eastern Europe may also influence significantly world trade in these products, although rapid consumption increases in those countries are unlikely. Of more immediate interest is the Japanese market, which is growing at a fast pace because of the elimination of import quotas. Similar developments are taking place in the Republic of Korea. Other nontraditional juice markets in Asia and elsewhere are also expected to expand, because of growing health awareness and higher living standards.

World demand is therefore forecast to expand strongly in the future. Developing countries are expected to be the main beneficiaries of this growth in overall terms, but high and fluctuating price levels for their juices (citrus and tropical) may in some cases result in increased demand for temperate-zone fruit and berry juices in some of the major markets. For example apple juice is already becoming more popular in some European markets, for instance Germany, than it was a few years ago. Exports of temperate-zone fruit and berry juices from East European countries may increase considerably in the future.

Although prospects appear to be very good for fruit juices from developing countries, the world markets is extremely competitive, and it may not always be technically advisable or economically feasible to start or expand production facilities for export. Investment decisions should be based on careful consideration of all relevant factors, for instance the infrastructure in the country concerned, the raw material supply and a realistic market forecast for the fruit juices, concentrates and pulp in question.

Major markets

World trade in fruit juices amounted to $3.9 billion in 1989. 1990 fugures are not yet available for all countries, but it is estimated that the total was close to $5 billion.

Since 1977 world trade in fruit juices has increased steadily, up from about $1 billion that year to a peak in 1984 of around $2.8 billion. After a slight decline in 1985, moderate growth followed in 1986 and new highs were reached in 1987 ($3.3 billion) and 1988 ($4.1 billion).

A small number of countries account for the major portion of fruit juice imports. The five leading markets for fruit and vegetable juices, which in 1989 were the United States (imports of $900 million), Germany ($637 million), United Kingdom ($386 million) Netherlands ($305 million) and France ($293 million), together purchased close to 65% of total world imports that year. Those next in line, in decreasing order of import values, were Canada ($250 million). Japan ($164 million), Belgium and Luxembourg ($120 million), Italy ($96 million), Saudi Arabia ($71 million), Sweden ($70 million), Austria ($68 million), Switzerland ($58 million), Spain ($51 million) and the Republic of Korea ($50 million).

The 11 import markets covered by the ITC survey are discussed below.

United States:

The United States is by far the world's largest import market for fruit juices and remained so over the 1985-89 period, although its share of the world total has fallen from 31% to 23% during the last five years. Imports have fluctuated considerably, reflecting price changes and wide variations in the level of domestic production of fruit juices, notably orange. In 1989 imports of fruit and vegetable juices amounted to $900 million, corresponding to nearly 2.8 billion litres.

Frozen orange juice concentrate is the major import item. Its share of total U.S. fruit juice imports ranged from 59% to 73% during the period 1985-89. In second place are apple juice and pear juices (the two are classified together; apple juice accounts for the larger portion of sales), whose share together of total imports has fluctuated between 16% and 24%.

The United States is the world's largest importer of pineapple juice. Foreign purchases reached $54.8 million in 1989, or 7% of total juice imports. All other juices had an 11% share that year, and no other single juice held a dominant position. Imports of tropical juices and pulp (mostly banana, guava, mango and papaya), however, have increased rapidly in recent years, although from a low level, except for banana puree.

Although fruit juice sales are high (per capita intake was estimated at 31 litres in 1989), the trade expects them to grow further, as the number of consumers could be expanded considerably.

Germany:

With total imports of fruit and vegetable juices amounting to $637 million in 1989, Germany was the largest juice market in Europe (see table on page 9). It is also the largest world market for tropical fruit juices, except for pineapple. Imports rose steadily between 1985 and 1989, from 381,000 tons to 551,000 tons, an increase of roughly 44%. In 1990 import volume went up to 587,000 tons and value to $799 million. (Figures before 1991 in this article for Germany refer to those for the former Federal Republic of Germany only.)

Germany is also a supplier of fruit juice raw material and of consumer-packed fruit juices and nectars, exported mainly to neighbouring countries.

German per capita consumption of fruit juices and nectars is the highest in the world, amounting to 36 litres in 1989. Although consumption may not expand to any great extent in the western part of the country, overall demand in the country is expected to

[TABULAR DATA OMITTED]

grow considerably. Fruit juice and nectar consumption in the eastern portion of Germany is increasing rapidly, reaching an estimated 15 litres per person in 1990. Market prospects appear to be 1990. Market prospects appear to be excellent as more of the 17 million consumers in the eastern region begin to purchase these products.

United Kingdom:

With imports of fruit and vegetable juices coming to about $386 million in 1989, the United Kingdom was the third largest import market in the world, a position that it has maintained since 1985, except for 1990 when it was overtaken by the Netherlands. Imports went up from 217,265 tons in 1985 to 273,008 tons in 1989, and remained at that level in 1990. However the import value increased to about $448 million that latter year.

Per capita consumption in 1989 of 18 litres is still well below several other leading juice-consuming countries, and only half of that of Germany. The fruit juice market is, however, growing relatively steadily and the trade is optimistic regarding sales prospects, although they agree that the market will remain an extremely competitive one.

Netherlands:

Although the Netherlands has a relatively small population, it was the fourth largest import market in the world for fruit and vegetable juices in 1989, with imports of $305 million. Over the 1985-89 period imports increased from 213,000 tons to 288,000 tons, and in 1990 jumped up by 39%, to about 400,000 tons, valued at $519 million, making the country the world's third largest importer that year.

The Netherlands is an important market for fruit juices, concentrates and pulp, not only because of the level of its domestic demand but also its role as a re-exporter and distributor of these products throughout Europe. In 1989 total juice exports and re-exports amounted to almost 145,000 tons, valued at $247 million. Quantities exported in 1989 came to 50% of those imported, and in value terms this percentage was over 80%. The "value added" element for such juices in the Netherlands comes from activities such as storage, re-packing, blending, agents' commissions and other costs associated with export servicing. It is likely that this market will further reinfoce its position as an entrepot for fruit juice raw material in the years to come.

France:

Imports of fruit and vegetable juices into France more than doubles between 1985 and 1989, from about 157,000 tons to around 338,000 tons, valued at $293 million the latter year. In 1990 imports reached 345,764 tons or $374 million.

With a per capita consumption of only 7 litres in 1989, howeverm the French market still offers potential that can be exploited by exporters in developing countries, although it is expected that Belgium, Netherlands and Germany may take an important share of the market. Most of the raw material required will still be sourced in developing countries.

Orange juice is the major item accounting for over half of total imports. Grapefruit juice has, however, shown the most rapid imports growth. It held a 9% share of 1989 juice imports. Pineapple and some other tropical fruit, for instance mango and banana, are becoming increasingly popular juices, and sales are expected to expand in the future. Other tropical fruit juices and pulp will probably have fewer sales opportunities in the next few years.

Canada:

The Canadian juice market was the world's fifth largest until 1989, when it was overtaken by France. The stagnation in imports (at around the $250 million level) in 1988 and 1989 was caused mainly by an economic slowdown, but the trade expects continued growth in the medium term. Imports have fluctuated in the range of 141,000 tons to 186,000 tons annually.

Importers favour concentrates over single-strength juices, in line with the requirements of the country's fruit juice industry. This development has helped traditional as well as new suppliers from developing countries to increase their share of the market.

Aseptic carton packaging (see packaging section below) and the introduction of new flavours are expected to boost consumption. Tropical juices, nectars and drinks are becoming more popular, and sales are likely to increase, if sufficient raw material at attractive prices is available to bottlers.

Japan:

Imports of all types of fruit juices into Japan have doubled in both quantity and value, from 35,750 tons, valued at $79 million in 1985, to 67,920 tons, at $164 million in 1989. In 1990 imports reached 111,895 tons, equivalent to $262 million.

Fruit juice imports have always been low in Japan, principally because of the existence of import quotas. The quotas have gradually been lifted since 1986, however, when imports of grapefruit juice were liberalized. Similar measures were taken for imports of certain other juices in subsequent years, for example apple, grape and pineapple in 1990, and single-strength orange juice this year. As of April 1992 quotas for orange juice concentrate will be lifted, and all fruit juices can then enter without quotas.

In view of the current low consumption of fruit juice and similar products in Japan and the fact that pure fruit juices are becoming more popular among consumers, a rapid growth in overall consumption is foreseen. Since domestic production of suitable raw material is insignificant, imports are expected to soar.

The main import items will reflect consumer preferences, which are strongest for citrus (in particular orange), apple and grape, followed by pineapple. Demand for tropical juices other than pineapple is expected to remain low. Currently the most important of these juice are guava, banana, mango and kiwi.

Belgium:

The Belgium import market for fruit and vegetable juices amounted to $120.3 million in 1989. Import volume increased from 89,000 tons in 1985 to 121,280 tons in 1989. In 1990 the figures rose to 176,238 tons, valued at $231 million, representing a considerable increase. Like the Netherlands and Germany, although to a lesser extent, Belgium is an important entrepot and redistribution centre for juices in the European market.

Consumption of fruit juice and nectars is still relatively low, compared with most northern European countries, although per capita intake has almost tripled during the last 15 years, from 5 litres in 1975 to 14 litres in 1989. Trade sources forecast considerable growth in this figure over the next few years, which will result in increased imports.

Italy:

The Italian market for fruit juices has been small until recently. Since 1985 imports have more than doubled in value, coming to $95.6 million in 1989, although graoe juice, including grape must, accounted for 20% of the total that year. Trade sources expect continued market expansion over the next several years because of the low per capita consumption. Further growth was achieved in 1990, when imports reached 131,143 tons, valued at $117 million.

Bottlers of fruit juices and nectars obtain their import requirements of raw materials mainly from blenders in the Netherlands, Germany and Belgium.

Although domestic production of citrus juices has grown considerably in recent years, most of this is either exported in bulk form or used in Italy to produce fruit juice drinks, rather than juices and nectars.

Traditionally Italians have consumed nectars, mainly from pear, peach and apricot, but interest is growing in pure juices, and imports of citrus juices have benefited greatly from this development. The market for tropical products is also expanding, although it is still small. Itally is one of the largest markets for pineapple juice.

Sweden:

The Swedish import market has grown steadily but relatively slowly over the period, from 33,406 tons in 1985 to 46,872 tons in 1989. Imports of fruit and vegetable juices increased from about $45 million to over $70 million during those years. Orange and apple juices are expected to remain by far the principal items, although other citrus juices, grape juice and various mixed fruit juices, including blends, are also leading sales items. Prospects for tropical fruit juices and pulp, including pineapple, continue to be limited, although a small market exists for them.

Switzerland:

During the 1986-90 period fruit and vegetable juice imports rose relatively slowly, reaching about 40,000 tons in 1990, valued at around $69 million. Orange juice is by far the largest import item, accounting for about two-thirds of total juice imports in 1990. Other leading juices are grapefruit juice (a 5% share of total imports) and "other citrus juices" (4%). Although Switzerland has the second highest per capita consumption of fruit juices in Europe (34 litres in 1989) it is still fairly conservative in its fruit juice consumption. A variety of tropical fruit beverages are sold in the market, but in relatively small quantities. Some growth is expected for mango beverages, however, from a fairly low current level.

Imports by type

Of the various juices, orange predominates on the world market. It accounted for $2.2 billion in sales in 1989, or 56% of world juice imports, roughly the same as in 1985. Imports of grapefruit juice came to about $158 million, or 4% of the world total (2% in 1985), followed by other citrus juices, at around $109 million, corresponding to just under 3% (approximately the same as in 1985). World imports of tomato juice were around $22 million, or a 0.6% share (0.9% in 1985). Pineapple juice imports were approximately $174 million, or almost 5% of the total (over 4% in 1985). Imports of juice of other fruits or vegetables amounted to $987 million, equivalent to a 26% share, compared with nearly 25% in 1985. In 1989 this category included apple juice ($516 million, or 14% of the total) and grape juice ($203 million, over 5%). Imports of mixtures of fruit or vegetable juices

European Community:

imports of fruit and vegetable juices

1990

Quantity (Q): tons Value (V): US$'000
Importing country Q V % of total
 value
Germany 587,349 799,434 29.9
Netherlands 401,073 519,077 19.4
United Kingdom 273,365 448,302 16.7
France 345,764 373,626 14.0
Belgium and Luxembourg 176,238 230,834 8.6
Italy 131,143 117,071 4.4
Denmark 41,127 60,914 2.3
Spain 57,025 59,624 2.2
Ireland 17,842 28,919 1.1
Greece 14,007 28,784 1.1
Portugal 4,514 11,324 0.4
Total 2,049,447 2,677,909 100.0
 Source: Statistical Office of the European Communities,
Eurostat, Luxembourg.


were at $116 million, or 3% of the total, compared with close to 2% in 1985. (The totals for individual juices do not necessarily add up to world import totals, as some countries report only totals for juices and do not provide detailed statistics.)

The table on page 6 shows imports off citrus juices by major market in 1989. The United States, Germany and the United Kingdom were the three largest importers of these juices in total and also specifically of orange juice. Next in line was the Netherlands. The principal importers of grapefruit juice were France, Japan, Germany and the United Kingdom.

In the case of pineapple juice, the United States was the leading market although its share of total imports decreased from 50% in 1985 to 37% in 1989. spectacular sales growth in this juice took place in Spain, France and Italy, whose import shares in total value traded on the world market went up rapidly between 1985 and 1989.

Tropical fruit juices and concentrates (other than pineapple) are not shown separately in trade statistics. Furthermore tropical fruit pulp is classified under a different heading than juices and concentrates, with pulp from nontropical fruit. Therefore no reliable statistics exist on world trade in tropical fruit juices, concentrates and pulp. Based on trade sources, however, annual world trade in these items (excluding pineapple) is estimated to be in the range of 175,000 tons to 200,000 tons in single-strength equivalent, valued at between $175 million and $200 million. This corresponds to about 4% of the value of world trade in all types of fruit juices, concentrates and pulp.

The three leading tropical fruit juices traded, apart from pineapple, are banana, passion fruit and mango, which together probably account for up to three-quarters of the exports of tropical fruit juices and pulps excluding pineapple.

Outlook:

The prospects for individual fruit juices, concentrates and pulp obviously vary from market to market. In general, however, citrus juices, and in particular orange, will remain in the lead in world trade, since these juices exist in large quantities and are well accepted by consumers in most markets.

During the last few years pineapple juice has become increasingly popular in most markets, resulting in shortages and high prices. Prospects for this juice are expected to remain good, provided a high-quality product is regularly made available at reasonable prices.

As far as other tropical juices and pulp are concerned, demand is rising in most markets. Tropical fruit juice beverages, however, generally have an acquired taste, and both time and a considerable amount of advertising and promotional activities are needed for consumer acceptance. Mango and banana juices, pulps and purees are considered to be particularly good growth items in the tropical sector in several of the markets.

The lack of regular and consistent supplies of good-quality products may impede the long-term development of the tropical fruit juice industry. This is, for example, the case in the United States, which is still a relatively small market for these products, except for banana puree.

Packaging

Fruit juice supplied by developing countries is imported primarily in bulk in the major markets, as discussed above. Suppliers in developing countries should therefore focus their marketing efforts on this type of packaging.

Fruit juice raw material is sold in several different forms of bulk packaging depending on the products and the producer in question. Frozen concentrated orange juice is packed in double polyethylene bags in 100-litre (usually 266-kg) drums. Such drums are also used for most other concentrates and single-strength juices, as for grapefruit, pineapple and passion fruit.

A major portion of Brazil's exports of frozen concentrated orange juice is transported in special tankers (i.e. seagoing vessels) with a capacity of several thousand tons. On arrival in Europe, the United States or Japan, the concentrate is pumped into storage tanks on "tank farms" and then later distributed in refrigerated road tankers (i.e. specialized lorries) to bottlers and other end-users.

A 200-litre aseptic drum is also used for orange juice and similar products. Other forms of aseptic pack are used for certain tropical products, such as banana puree and mango pulp.

(Aseptically packaged products are sterile items, packed and sealed into sterile packaging under sterile conditions, so that no subsequent heat treatment or refrigeration is needed to preserve them until the pack is opened.)

Tropical fruit pulp and puree are often hot-packed in metal cans of 3 kg net, or deep-frozen in cartons of 20 kg to 25 kg or in drums of up to 200 litres.

Refrigerated road tankers are also used, for example from Spain to France or other European destinations, from Mexico to the United States, and, as mentioned above, "from tank farms," for instance in the Netherlands or Belgium, to bottlers throughout Europe.

New bulk-packaging technologies are being developed for liquid foodstuffs that are appropriate for fruit juices. These techniques are aimed at achieving economic handling while maintaining product sterility. Examples are pallet-size bag-in-box systems and "flexitanks."

Rudy Kortbech-Olesen is an ITC market development adviser. This article is based on a new ITC market study that he wrote, along with Robert Dunning, Jacques Henry and Yasusuke Mori, entitled The World Fruit Juice Market, with Special Emphasis on Citrus and Tropical Fruit Juices. (See also FORUM, October-December 1990, page 12.)
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Title Annotation:world trade in fruit juices
Author:Kortbech-Olesen
Publication:International Trade Forum
Article Type:Cover Story
Date:Jul 1, 1991
Words:3738
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