INTERNATIONAL SEMINAR ON ECONOMICS INTERNATIONAL SEMINAR ON ECONOMICS AND MARKETING OF TROPICAL AND AND MARKETING OF TROPICAL AND SUBTROPICAL FRUITS SUBTROPICAL FRUITS 16- 16 -18 July 2007 18 July 2007 PWTC PWTC Kuala Lumpur, Malaysia Kuala Lumpur, Malaysia
The Global Supply and Demand The Global Supply and Demand Prospects of Tropical Fruits Prospects of Tropical Fruits A presentation by : Kaison Kaison Chang, Chang, A presentation by : Secretary, FAO Sub- -Group on Group on Secretary, FAO Sub Tropical Fruits Tropical Fruits
The Global Supply and The Global Supply and Demand Prospects of Demand Prospects of Tropical Fruits Tropical Fruits Current Situation � Data Source - Annual questionnaire, supplemented by FAOSTAT and COMTRADE Medium Term � Dynamic time series models used
� � Tropical fruits are widely perceived by Tropical fruits are widely perceived by developing countries as representing viable developing countries as representing viable options for diversification options for diversification � � Future international trade prospects Future international trade prospects are subject to uncertainties, some of which are subject to uncertainties, some of which derive from the very success of export derive from the very success of export efforts of the pioneers in the field efforts of the pioneers in the field � � In particular, diversification into In particular, diversification into tropical fruit has in some cases been tropical fruit has in some cases been encouraged without sufficient knowledge of encouraged without sufficient knowledge of potential market outlets, with resultant potential market outlets, with resultant adverse price effects for all. adverse price effects for all.
Tropical Fruits - - Production Production Tropical Fruits (Thousand tonnes) (Thousand tonnes) 72000 70000 68000 66000 64000 62000 60000 58000 1999 - 01 Total 2002 2003 2004 2005
Tropical Fruits Production Tropical Fruits Production 2005 2005 (Thousand tonnes) 30000 25000 20000 15000 10000 5000 0 Mango Minor Pineapple Papaya Avocado
Share of Fruit Production by Share of Fruit Production by Region - - 2005 2005 Region Asia LAC Africa Oceania
Minor Fruit Production - - 2005 2005 Minor Fruit Production (Thousand Tonnes) (Thousand Tonnes) 20000 15000 10000 5000 0 Durian Rambuttan Guava Total
Durian Production – – 2005 2005 Durian Production (Thousand tonnes) (Thousand tonnes) 700 600 500 400 300 200 100 0 Thailand Indonesia Malaysia
Rambutan Production Production – – 2005 2005 Rambutan (Thousand tonnes) (Thousand tonnes) 800 700 600 500 400 300 200 100 0 Thailand Indonesia Malaysia
Guava Production - - 2005 2005 Guava Production (Thousand tonnes) (Thousand tonnes) 1800 1600 1400 1200 1000 800 600 400 200 0 India Pakistan
Trade Value – – 2005 2005 Trade Value (US $ million) (US $ million) 5000 4500 4000 3500 3000 2500 2000 1500 1000 500 0 Tropical Bananas apples oranges pears Fruits
Major Fresh Tropical Fruits Exports Value Million US $ 1100 550 0 Pineapples Mangoes Papaya Avocados 2003 2004 2005
Fresh Tropical Fruits Exports Fresh Tropical Fruits Exports (Thousand tonnes) (Thousand tonnes) 2005 2004 2003 2002 1999-01 0 1000 2000 3000 4000 5000 Total Mangoes Pineapples Avocados Papaya
Fresh Tropical Fruits Imports Fresh Tropical Fruits Imports (Thousand tonnes) (Thousand tonnes) 2005 2004 2003 2002 1999-01 0 1000 2000 3000 4000 5000 Total Mangoes Pineapples Avocados Papaya
MEDIUM- -TERM OUTLOOK TERM OUTLOOK MEDIUM � Dynamic time series models used for projections Dynamic time series models used for projections � � Assumptions included : Assumptions included : � � normal weather conditions would prevail � normal weather conditions would prevail � past trends in planted areas, yields, GDP growth and � past trends in planted areas, yields, GDP growth and population would continue. population would continue. � Adjustments made to the forecast results to reflect � Adjustments made to the forecast results to reflect current trends, policies and future market prospects current trends, policies and future market prospects � Projections do not account for processed fruit, due to � Projections do not account for processed fruit, due to lack of trade information and conversion factors lack of trade information and conversion factors between fresh and processed forms between fresh and processed forms
Projected Production to 2014 Projected Production to 2014 (Thousand tonnes) (Thousand tonnes) 84000 82000 80000 78000 76000 74000 72000 70000 68000 66000 64000 2005 2014
Projected Production by Projected Production by Variety - - 2014 2014 Variety (Thousand tonnes) (Thousand tonnes) Mango Pineapple Papaya Avocado
Projected Share of Mango Projected Share of Mango Production by Region – – 2014 2014 Production by Region Asia LAC Africa Other
Projected Share of Pineapple Projected Share of Pineapple Production by Region – – 2014 2014 Production by Region Asia LAC Africa Other
Projected Share of Papaya Projected Share of Papaya Production by Region – – 2014 2014 Production by Region Asia LAC Africa Other
Projected Share of Avocado Projected Share of Avocado Production by Region – – 2014 2014 Production by Region Asia LAC Africa Other
Projected Import Demand by Projected Import Demand by 2014 2014 (Thousand tonnes) (Thousand tonnes) 4000 3500 3000 2500 2000 1500 1000 500 0 Developed Developing Total
Projected Import Demand by Projected Import Demand by Variety Variety (Thousand tonnes) (Thousand tonnes) 3500 3000 2500 2000 1500 1000 500 0 Pineapple Mango Papaya Avocado Total
CONCLUSIONS CONCLUSIONS 1. Data Constraints Data Constraints 1. � Constraint to supply and demand � Constraint to supply and demand analyses analyses � Lack of international standards � Lack of international standards – – difficult difficult to compare prices to compare prices � Re minor fruits � Re minor fruits - - unless the value of trade unless the value of trade of an individual fruit exceeded US $50 of an individual fruit exceeded US $50 million, statistics will continue to be million, statistics will continue to be aggregated – – World Customs World Customs aggregated Organization. . Organization
CONCLUSIONS - - Contd Contd CONCLUSIONS 2. Increasing share of fresh fruit 2. Increasing share of fresh fruit � Advances in post harvest technology � Advances in post harvest technology � Highly efficient logistics � Highly efficient logistics � Price premiums based on quality have � Price premiums based on quality have replaced novelty based premiums replaced novelty based premiums � Hikes in oil prices have eroded profit � Hikes in oil prices have eroded profit margins margins � Traders reluctant to pass on increased � Traders reluctant to pass on increased costs to retailers because of intense costs to retailers because of intense competition in a highly elastic market competition in a highly elastic market
CONCLUSIONS - - Contd Contd CONCLUSIONS 3. Medium Term Medium Term 3. � projections suggest that demand will � projections suggest that demand will continue to grow strongly continue to grow strongly � Supply per se is not a major constraint to � Supply per se is not a major constraint to international trade, as only 5 percent of international trade, as only 5 percent of production is actually exported production is actually exported � Importance of quality in an increasingly � Importance of quality in an increasingly crowded international fruit market has led to crowded international fruit market has led to major initiatives major initiatives � Major challenges in managing the field � Major challenges in managing the field- -to to- - market- -supply chain, for both fresh and supply chain, for both fresh and market processed products processed products � Should find a proper balance between cost � Should find a proper balance between cost and demand when meeting standards and demand when meeting standards
CONCLUSIONS - - Contd Contd CONCLUSIONS Policy Issues 4. Policy Issues 4. � Phytosanitary measures are of concern � Phytosanitary measures are of concern � Although market access and sanitary � Although market access and sanitary issues are of importance, compliance issues are of importance, compliance is not as problematic is not as problematic � Challenges in WTO on scientific and � Challenges in WTO on scientific and equivalency grounds are common equivalency grounds are common � Cost of treating fruit for exports could � Cost of treating fruit for exports could be a limiting factor be a limiting factor � Must be clearly linked to supply � Must be clearly linked to supply outputs outputs
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