FRUIT AND TREE NUTS                                          April 5, 2000
March 2000, ERS-FTS-288 
              Approved by the World Agricultural Outlook Board
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Summary
 
The index of prices received by growers for fruit and nuts
has averaged lower during the first 2 months of 2000 than
any other year since 1995. Lower prices for fresh oranges
have driven the overall index. Prices are expected to remain
above a year ago, however, for the 1999/2000 marketing year
for grapefruit, lemons, apples, and pears. Good weather in
both Florida and California this past winter produced a
large strawberry crop and brought down prices.  The Consumer
Price Index for fresh fruit during January and February
averaged about the same as a year earlier. Lower orange and
strawberry prices offset higher prices for other fruit.
 
The 1999/2000 orange crop is expected to increase 29 percent
over the previous year's crop due to good weather conditions
in Florida and California. As of March 1, 2000, the crop is
forecast to total 12.8 million tons. Orange production is
expected to be larger in all citrus-producing States, except
Arizona, with the largest percentage increase in California.
California's orange crop is expected to increase 76 percent
from last year, and Florida's crop is expected to increase
22 percent. The crop was late to mature again this year as
it was last year. The large crop this year has put downward
pressure on prices.
 
California's navel orange crop appears to have mostly
recovered from last year's freeze, with a 91-percent
increase in crop size. Damage to the trees seems to have
been less than was expected, however, production has not
returned to the same quantity as before the freeze. The
fruit are mostly smaller than average in size this year. The
sizing problem of this year's navel orange crop could
adversely affect grower prices. This year's navel crop was
late to mature because fruit were late to obtain the right
color and sugar levels. The Valencia orange crop is
projected to increase 49 percent to 1 million tons in
1999/2000. If realized, this crop would be the largest since
1995/96. The fruit are expected to be of good quality, which
should moderate any decline in prices resulting from the
larger supply.
 
Florida is expected to produce 20 percent more early- to 
mid-season oranges and 25 percent more Valencia oranges than a
year ago. Orange juice production for 1999/2000 is forecast
at 1.4 million single-strength equivalent (sse) gallons, up
15 percent from last year, but below levels produced in
1996/97 and 1997/98. The larger crop this year, along with
high beginning juice stocks, lowered processing orange
grower prices for the first quarter of the marketing year.
Prices, however, have steadily increased since the beginning
of the season. Prices should continue to improve as the
season progresses due to low juice yields and improved
fruit, which will mean higher demand for fruit.
 
The U.S. grapefruit crop is expected to total 2.5 million
tons in 1999/2000, 2 percent lower than last year. Grower
prices continue to improve for the second consecutive year.
From October through February, prices for all grapefruit
have averaged $4.35 per box, the highest since 1993/94. The
average price for Florida's processing grapefruit has been
the highest in 8 years during October through February.
Processors' demand for grapefruit is strong because of low
juice stocks coming into the marketing year.
 
The 1999/2000 U.S. lemon crop is expected to produce 916,000
tons of fruit, 23 percent more than last year. California's
lemon trees in the San Joaquin Valley appear to have
recovered from last year's freeze, and the State's
production is expected to increase 30 percent over last
year. Lemon grower prices in California for 1999/2000
(August-February) have averaged $2.09 per box below a year
earlier. The larger lemon crop has kept prices down.
California's production should be sufficient to last through
the summer, the biggest consumption season.
 
Improved weather conditions in both Florida and California
contributed to the projection for larger tangerine and
Temple crops in 1999/2000. The tangerine crop, the largest
among the specialty citrus crops, is expected to be 38
percent larger this year than 1998/99, with an expected
record total of 450,000 tons.
 
The 1999 utilized production of noncitrus fruit was
estimated at about 17.1 million short tons, up 4 percent
from 1998. Utilized production increased for avocados,
Hawaiian bananas, berries, sweet cherries, cranberries,
grapes, nectarines, olives, Hawaiian papayas, peaches,
pears, pineapples, strawberries, and California plums and
prunes. The preliminary estimate of the value of noncitrus
fruit production for 1999 was a record $8.2 billion, up 14
percent from the previous year.
 
Washington apple production decreased by 23 percent in 1999,
from 6.6 billion pounds to 5.1 billion pounds. Although
production increased in other important apple-producing
States, such as New York, Michigan, and Pennsylvania, the
1999 U.S. apple crop declined nearly 8 percent from the
previous year to 10.7 billion pounds. This year's smaller
crop in Washington will lead to a decrease in fresh-market
supplies for the 1999/2000 marketing season, and apple
prices are likely to average higher than the previous
season.
 
The winter of 1999 provided near-ideal growing conditions
for Florida strawberry growers. Strawberry production
increased 15 percent from the previous year. Unlike the
previous winter, this year's winter weather was cooler and
has contributed to a high-quality crop. California, which
produces about 83 percent of the U.S. total, is expected to
have a good growing season as well. According to the
California Strawberry Commission, planted acreage for 2000
is up 7 percent from the previous year. In addition, warm
January temperatures have led to good crop development, and
a relatively drier growing season is yielding good-quality
strawberries.
 
California's avocado crop is expected to be about 20 percent
greater in 1999/2000 than the previous year. Because overall
domestic supplies in 1999/2000 are anticipated to exceed
last season, avocado prices are likely to average lower. A
larger U.S. crop and lower domestic prices point to fewer
imports in 1999/2000, however, Mexican avocado imports are
expected to continue to increase as they have since gaining
access to the U.S. market in 1997.
 
Fresh fruit imports from Chile have seen steady growth in
the United States. Major fresh fruit imports increased an
average of 31 percent a year throughout the nineties. In
1999, U.S. imports of major Chilean fresh fruit increased 34
percent over 1998. Most of the increase was from larger
shipments of stone fruit-peaches and plums, as well as pears
and berries, such as blueberries and raspberries. Grape
imports fell 5 percent in 1999 from the previous year.
 
Production of all of the major tree nuts increased sharply
in 1999, except for pistachios and macadamia nuts, reaching
a record of 1.25 million tons, in-shell equivalent, up 38
percent from the previous season. The preliminary estimate
of the value of production for almonds, hazelnuts, walnuts,
pistachios, macadamias, and pecans increased approximately 9
percent from 1998.
 
Lower Grower Prices Expected for the First Half of 2000
 
The index of prices received by growers for fruit and nuts
averaged lower during the first 2 months of 2000 than any
other year since 1995 (table 1). Lower prices for fresh
oranges have driven the overall index. California's orange
crop returned to average levels this year after a loss of
almost half the fresh orange crop last year because of bad
weather. Fruit size, however, has been smaller than average,
further lowering the prices growers receive. As a result,
grower prices for fresh oranges averaged 61 percent lower
this January and February than a year ago. Prices are likely
to remain below last year's level for the remainder of the
first half of 2000 since fresh oranges are a major component
of the index during this period. Good weather in Florida and
California during the strawberry season has boosted
production and should continue to keep fresh strawberry
prices below a year ago. Prices, however, are expected to
remain above a year ago for grapefruit and apples because
there are lower quantities of these fruit available coming
into this year.
 
In January and February, retail prices averaged above a year
earlier for most fresh fruit (table 2). Higher prices for
grapefruit reflect the smaller amount of larger-sized
grapefruit available for the fresh market as growers are
sending their fruit to processors where they are receiving
competitive or higher prices. Higher grower prices for
lemons this January and February were passed on to consumers
in terms of higher prices in the retail market. Retailers
appear to be slow in reducing frozen concentrate orange
juice prices in light of the expected larger supply of juice
from this year's season. Prices also averaged higher for Red
Delicious apples, Anjou pears, and Thompson Seedless grapes.
 
The strong influence of navel oranges in the fresh market in
January and February kept the Consumer Price Index (CPI) at
about the same level as a year ago, despite higher prices
for many other fresh fruit. If orange and strawberry prices
continue low to moderate, the CPI should remain at levels
similar to last year, at least until May and June when the
presence of citrus is lessened in favor of noncitrus fruit.
Valencia oranges, entering the market in March, are expected
to be in ample supply and should help continue to moderate
the CPI. It is still too early to forecast noncitrus fruit
production because the trees are still either in the early
stages of blooming and budding or in dormancy.
 
Citrus Outlook
 
Favorable weather conditions in 1999 throughout the
citrus-producing States have returned the 1999/2000 crop to
average levels. Last year's crop was reduced by the lasting
effects of El Nio and La Nia weather patterns in Florida
and freezing temperatures in California. This year's weather
has been more conducive to higher production, and the crops
have returned to more normal levels. The 1999/2000 citrus
crop is forecast to total 16.8 million short tons. If
realized, this year's crop will be 23 percent greater than
last year but 5 percent smaller than 1997/98. California's
crop is expected to increase 56 percent, and Florida's crop
is expected to increase 17 percent over a year earlier.
Production is projected up for oranges, lemons, tangerines,
and Temples. Only the grapefruit and tangelo crops are
expected to be smaller this year.
 
Orange Crop Expected To Recover and Lower Prices
 
The 1999/2000 orange crop is expected to increase 29 percent
over the previous year's production due to good weather
conditions in Florida and California. As of March 1, 2000,
crop size is forecast to total 12.8 million tons (table 3).
The crop is comprised of 59 percent early and midseason
variety oranges in Florida and navel oranges in California,
Florida, Arizona, and Texas, and 41 percent Valencia
oranges, the major variety of late season orange. Crops are
expected to be larger in all citrus-producing States, except
Arizona, with the largest percentage increase in California.
California's orange crop is expected to increase 76 percent
from last year, to 2.5 million tons. Florida's production is
expected to increase 22 percent to 10.2 million tons. Texas'
crop is forecast to be 20 percent larger than last year,
totaling 73,000 short tons. Arizona's crop is projected to
drop 7 percent to 40,000 tons, with the decline coming from
the Valencia crop.
 
The crop was late to mature again this year just as it was
last year. As a result, availability of fresh oranges was
limited in the marketplace in November, keeping California's
prices strong for that month. Once the fruit did enter the
market, however, prices fell and should remain below last
year for the remainder of the season. Florida's prices for
all oranges are lower so far this year as a result of its
larger crop.
 
California's Production Rebounds after Losing Almost Half
Its Crop Last Year
 
California produces oranges for the fresh market and is the
major supplier of fresh oranges for the domestic and export
markets. The navel orange crop appears to have mostly
recovered from last season's freeze, with a 91-percent
increase in crop size. Damage to the trees seems to have
been less than was expected, however, production has not
returned to the same quantity as before the freeze. The
smaller number of boxes projected to be harvested this year,
compared with 2 years ago, can be attributed to the smaller
size of this year's fruit. Below normal precipitation this
past winter adversely affected fruit size. Growers will not
be able to get a premium price for fruit that are below
average size, and receipts this year will probably be lower
than first anticipated due to the sizing problem. This
year's navel crop was late to mature because fruit were late
to obtain the right color and sugar levels.
 
The Valencia orange crop is projected to increase 59 percent
to 1 million tons in 1999/2000. If realized, this crop would
be the largest since 1995/96. The large supply of Valencia
oranges will allow domestic fresh oranges to be available
throughout the year, unlike last season when the small crop
ended harvesting early.  Last season's sales were cut short
because of the smaller crop. The larger crop should keep
prices below a year ago. The fruit are expected to be of
good quality, which should moderate any decline in prices.
 
Exports have improved this year over a year earlier from
November through January. The favorable exchange rate with
Japan, a major export market, has boosted sales. November
through January 1999/2000 sales to Japan were up 11 percent
from 2 years ago, a very good year for orange exports,
according to industry sources. The Korean market also
increased during this period. Exports should be markedly
higher than last year because the drastically reduced
freeze-damaged crop last year limited the quantity and quality of
fruit available for export. Exports for 1999/2000 are
forecast to reach about 660,000 tons. If realized, exports
would be 144 percent higher than last year, but 7 percent
below 1997/98. Exports for 1998/99 totaled 271,000 tons, 62
percent lower than 1997/98.
 
The smaller crop in 1998/99 contributed to increased imports
from Mexico and Spain, both of which provided oranges during
the winter and early spring. Imports from Australia,
however, the major source of fresh oranges to the U.S.
market in late spring and summer, were down. Imports reached
112,000 tons in 1998/99, 156 percent above a year ago. With
the return to a more average-sized crop this year, imports
should decline in 1999/2000 to levels similar to 2 years
ago.
 
Florida Orange Prices Lower than a Year Ago in Response to
Larger Crop
 
In 1999/2000, Florida is expected to produce 20 percent more
early- to mid-season oranges and 25 percent more Valencia
oranges than a year earlier. Prolonged and multiple blooms
in spring 1999 caused a delay in crop maturity and as a
result, utilization is running behind the last 2 years. As
of mid-February, almost 20 percent of the early- and 
mid-season oranges still needed to be harvested verses 12
percent last year and 8 percent in 1997/98. Maturity,
however, appears to be less of a problem for Valencia
oranges. Valencia harvesting had only just begun as of the
end of February. About 4 percent of all oranges have gone to
the fresh market so far this year, down slightly from last
year.
 
Orange juice production is forecast at 1.4 million
single-strength equivalent (sse) gallons, up 15 percent from
last year, but below levels produced in 1996/97 and 1997/98
(table 5). Despite lower juice yields, forecast at 1.54
gallons per box, supply is expected up this year. Due to
high beginning stocks and imports, orange juice supply is
projected to reach 2.1 million sse gallons in 1999/2000, the
second highest on record. As a result of the large supply
this year, ending stocks are forecast to be at least 435
million sse gallons. Orange juice per capita consumption is
projected to be 5.6 sse gallons in 1999/2000, about the same
as a year ago.
 
Imports are expected to be down from a year ago, but the
second highest since 1993/94, despite the larger crop and
increased production over a year ago. Partly, strong imports
can be attributed to the late start and poor coloring of the
early oranges and the need for imported frozen concentrated
orange juice (FCOJ) to blend with domestic FCOJ. However,
large shipments this past December were destined for ports
other than those in Florida. The imports are being shipped
directly to end users, mostly in the Northeast, where the
FCOJ is reconstituted and sold retail or to food service.
Brazil is the world's largest orange juice producer and
exporter, with Europe as a major market. Demand in Europe,
however, is off this year because of the weak Euro relative
to the U.S. dollar, and Brazil is shipping more to the
United States to help drive down Brazilian stocks. According
to studies at the University of Florida, Brazil is able to
produce and ship FCOJ to the northeastern United States at
prices comparable with those from Florida.
 
About 48 percent of the crop is expected to be used to
produce FCOJ in 1999/2000. Only 2 years ago, FCOJ accounted
for 64 percent of orange utilization. Not-from-concentrate
orange juice (NFC) continues to take a strong hold on the
retail market, and much of the remaining crop is expected to
go towards making NFC (table 6). The bulk of FCOJ is used
for institution and foodservice industries. Total movement
of all chilled orange juice (NFC and reconstituted) has been
down slightly from last year. With poor fruit coloring at
the beginning of the season, much of the juice did not meet
quality standards, according to industry sources, and
processors held back on their retail promotions. With
quality improving as the season progresses and good quality
and color expected of the Valencia oranges, promotions
should become more frequent, and should drive down retail
prices for NFC.
 
The larger crop this year, along with high juice beginning
stocks, lowered processing orange grower prices by 38
percent for the first quarter of the marketing year (table
7). Prices, however, have been increasing each month of this
marketing year as better quality fruit become available.
They should continue to improve as the season progresses
because low juice yields will mean higher demand for fruit,
and because the later, better quality fruit will be needed
for the high-valued NFC.
 
Brazil also started 1999 with high beginning stocks (table
8). Orange juice production is expected to be up 8 percent
from 1998. Higher production in Brazil as well as the United
States have also contributed to the lower prices received by
U.S. orange growers as well as to lower near-term futures
prices so far this year.
 
Orange juice exports are expected to be about 3 percent
higher this year than a year ago. Strong competition from
Brazil and lower demand in the European Union, however,
could hinder U.S. sales abroad. For December and January,
exports were 7 percent below last year. Major markets
included Canada, the European Union, and Japan.
 
Grapefruit Production Expected Lower Again in 1999/2000
 
The grapefruit crop is expected to total 2.5 million tons in
1999/2000, 2 percent lower than last year (table 9).
Florida's crop, which is expected to account for 79 percent
of this year's production, also is projected 2 percent lower
this year. Hurricane Irene hit the east coast of Florida,
the major grapefruit production region, during mid-October,
blowing mature fruit off the tree and reducing the crop
size. Higher rates of red grapefruit droppage and increased
incidences of disease also occurred in these groves because
of standing water after the hurricane. The bloom period was
more sporadic for grapefruit for the 1999/2000 crop than
previous years and this can affect fruit utilization as
well. Because maturity will be staggered as a result of the
uneven blooming, some of the later fruit may not be
harvested, unless there are strong economic incentives.
 
Texas' grapefruit crop is also expected to be smaller this
year, with a 10-percent decline from a year ago. The quality
of the fruit are reported to be good. Fruit movement has
been above last year, as Texas grapefruit had a window of
opportunity early in the season because of the late-maturing
Florida crop. California's grapefruit crop is projected to
be 7 percent larger this year and Arizona's crop 8 percent
larger. Together, they account for about 12 percent of
grapefruit production, with most of the harvesting occurring
after Florida and Texas have finished.
 
Grower prices continue to improve for the second consecutive
year. From October through February, prices for all
grapefruit have averaged $4.35 per box, the highest since
1993/94 (table 10). Fresh-market grapefruit prices averaged
$5.75 a box during this time, $1.36 higher than last year.
Florida fresh grapefruit prices have been 36 percent higher
than the previous year through February. The majority of
grapefruit are smaller than last year, and higher
fresh-market prices this February may be a result of fewer
high-demand large fruit available than earlier in the
season.
 
The average price for Florida's processing grapefruit has
been the highest in 8 years during October through February.
In January, growers were receiving more than twice as much
per box for grapefruit going to processing than the fresh
market. Demand for grapefruit is strong from processors
because of low stocks coming into the marketing year.
According to members of the industry, demand is so high from
processors that fruit are being diverted from the fresh
market for processing, especially the smaller-sized fruit.
According to the industry, movement of frozen concentrated
grapefruit juice (still the most common form) is down from
last year because of higher retail prices. March is the
major month for grapefruit processing, and the increase in
supply by the end of March could help bring down retail
prices and improve movement.
 
Fresh grapefruit exports are 7 percent below last year from
September through January. The weak Euro contributed to a
decline in shipments to the European Union. Sales to Canada
and Japan, however, have picked up this year, with sales to
Japan 29 percent higher than during September through
January a year earlier. The grapefruit industry, however, is
also facing a similar stagnant demand for grapefruit in the
export market as it has been experiencing in the domestic
market. With the possibility of new markets opening in China
in the near future, demand could improve internationally. It
may take several years after shipments begin, however,
because China is not familiar with the American grapefruit
and a few years of promotion may be necessary to create a
demand.
 
Larger Lemon Crop Projected for 1999/2000, Bringing Lower
Grower Prices
 
The 1999/2000 lemon crop is expected to produce 916,000 tons
of fruit, 23 percent more than last year (table 11).
California's lemon trees in the San Joaquin Valley appear to
be recovering from last year's freeze, and the State's
production is expected to increase 30 percent over last
year. If realized, California's lemon production will
account for 87 percent of domestic lemon production.
Arizona's production fell 10 percent this year, to 118,000
tons. This year's crop, however, was 19 percent above 2
years ago.
 
Lemon grower prices in California for 1999/2000
(August-February) have averaged $2.09 per box less than a
year ago (table 12). The larger lemon crop has kept prices
down. Arizona's grower prices, however, averaged $1.95 per
box above the previous year. Arizona lemons are marketed
early in the season. With the smaller crop and remaining
uncertainty about the lasting damage of last year's freeze
in part of California's lemon-producing region, growers were
able to capture a higher price for their crop.  California's
production should be sufficient to last through the summer,
the period of greatest seasonal demand. With sufficient
supply, prices should remain seasonably stable.
 
Larger Specialty Citrus Crop Expected in 1999/2000
 
Improved weather conditions in both Florida and California
contributed to the projection for larger tangerine and
Temple crops in 1999/2000 (table 13). The tangerine crop,
the largest among the specialty citrus crops, is expected to
be 38 percent bigger this year than 1998/99, with an
expected record total of 450,000 tons. Florida's crop, 72
percent of the U.S. tangerine crop, is expected to increase
37 percent over a year ago. The harvest of early tangerines
finished by mid-February this year, earlier than the
previous year. Robinson tangerines were larger than average,
but Fallglo, Sunburst, and Darcy were all smaller this year.
Honey tangerines, the late-variety grown in Florida, were
late to mature this year. Fruit size is also below average.
Harvesting began in early January. As of the end of
February, about two-thirds of the crop remained to be
harvested, a higher proportion than the previous 2 years.
The average grower price for tangerines so far in 1999/2000
has ranged from a high at the beginning of the season of
$11.35 per box in October to a low of $7.11 in December.
Prices declined in December as they often do with the ending
of the early varieties, and picked up again in January with
the beginning of the Honey crop. Small fruit sizes for this
year's Honey crop could put downward pressure on prices for
the remainder of the crop.
 
The volume of U.S. clementine imports, a tangerine variety,
has been growing at an average rate of 183 percent annually
throughout the nineties. In 1999, imports grew 95 percent
over the previous year. Clementine imports mostly are
shipped to northeastern and midwestern States. Shipments
occur around the same time California navel oranges and
Florida tangerines are in the market. The late maturity of
this year's navel crop partially contributed to the large
increase in imports this year. The healthy U.S. market
compared with the European Union this year also contributed
to more clementines being shipped to the United States.
Ninety-four percent of the clementine imports in 1999 came
from Spain.
 
Noncitrus Production Increases from Previous Year
 
The 1999 utilized production of noncitrus fruit was
estimated at about 17.1 million short tons, up 4 percent
from 1998 (table 14). This winter's weather was less
disruptive than the previous winter. Utilized production
increased for avocados, Hawaiian bananas, berries, sweet
cherries, cranberries, grapes, nectarines, olives, Hawaiian
papayas, peaches, pears, pineapples, strawberries, and
California plums and prunes.
 
The preliminary estimate of the value of noncitrus fruit
production for 1999 was a record $8.2 billion, up 14 percent
from the previous year. Much of the increase came from
apples (the second most valuable noncitrus crop in the
United States next to grapes) where increased prices more
than offset a decrease in production for a net increase of
27 percent in the total value. Conversely, production
increases more than offset price decreases for an overall
increase in the value of production of berries, sweet
cherries, grapes, and strawberries. The combined value of
these crops made up 56 percent of the total value of
noncitrus fruit in 1999.
 
Apple Production Down in the Northwest, Average Price
Highest Since 1995
 
The National Agricultural Statistics Service (NASS) of the
USDA will report its final estimate of 1999 fresh-market
apple production in the United States on July 7, 2000. Based
on the USDA's January 2000 preliminary estimates, apple
production (fresh and processed) for 1999 increased in the
Eastern and Central States, but decreased in the Western
States. In Washington, the largest producer of apples in the
United States, apple production decreased by 23 percent,
from 6.6 billion pounds to 5.1 billion pounds (table 15).
Frost damage, poor pollination, and reduced bloom decreased
production in Washington and other Western States. Although
production increased in other important apple-producing
States, such as New York, Michigan, and Pennsylvania, the
1999 U.S. apple crop decreased by nearly 8 percent from the
previous year to 10.7 billion pounds. The average price for
apples received by U.S. growers in 1999 rose 30 percent from
the previous year to $320 per short ton.
 
Typically, over 60 percent of U.S. fresh-market apple
production comes from Washington. The smaller 1999 crop has
led to a decrease in fresh-market supplies for the 1999/2000
marketing season, and apple prices have averaged higher than
the previous season. Prices received by growers for
fresh-market apples during 1999/2000 thus far
(August-January) have averaged 27 percent higher than the
same period a year earlier and are right at the
1995/96-1998/99 average. Decreased shipments, especially
from Washington, and an overall decrease in storage as of
February 1, 2000, will continue to put upward pressure on
apple prices through much of the 1999/2000 marketing season.
 
According to the U.S. Apple Association, total movement of
fresh-market apples as of January 2000 was 12 percent less
than the same period in 1999 and 7 percent less than the
average of the last 5 years. The Association also reported
total U.S. apple stocks on February 1, 2000, to be 2 percent
lower than last year, although 7 percent higher than the
average of the previous 5 years. Apples intended for the
fresh market were down 6 percent, and processing apple
stocks were up 6 percent. By region, apple stocks were lower
in the West (down 14 percent) and higher in the other
regions: Northeast (46 percent), Southeast (14 percent), and
the Midwest (33 percent).
 
Nearly 45 percent of the fresh-market apples in storage on
February 1, 2000, were Red Delicious, and there were 15
percent less of this variety in storage than at the same
time a year ago. Stocks of fresh-market Golden Delicious
were down less than 1 percent and Granny Smith were down 11
percent. Meanwhile, stocks of fresh-market McIntosh apples,
grown mostly in the Northeast, were up 68 percent. Stocks of
fresh-market Fuji apples were down 18 percent.
 
Higher apple prices in the United States, as well as large
export supplies in the European Union, have led to a
decrease in U.S. apple exports. The volume of U.S.
fresh-market apple exports, from August to December 1999,
was down 26 percent from the same period the year before.
Most of the decrease occurred in important markets such as
Taiwan, the largest market (down 22 percent), Hong Kong
(down 53 percent), and Canada (down 1 percent). Exports to
Indonesia, another important market, recovered from last
year's drop by increasing 185 percent. The strong growth in
exports to Mexico continued (up 46 percent), partly as a
result of strong consumer demand, lower domestic production,
and the lowering of the price floor of U.S. Red and Golden
Delicious apple exports to Mexico from $13.72 per box to
$11.29 per box in October 1999.
 
In June 1999, a dumping investigation of imports of apple
juice concentrate from the People's Republic of China was
initiated. The investigation addresses allegations that
China is selling their product in the United States at
unfairly low prices, causing economic injury to the domestic
industry. In July, the International Trade Commission (ITC)
made a preliminary finding that there is a reasonable
indication that U.S. apple juice producers are materially
injured or threatened with material injury by the import of
nonfrozen apple juice concentrate from China. On November
16, the Department of Commerce made a preliminary finding
that dumping has occurred. As a result, a preliminary
antidumping duty of 55 percent (the estimated margin by
which the producer was dumping) has been imposed
retroactively to August 25, 1999. The final step of the
antidumping investigation process consists of the ITC and
the Department of Commerce conducting a more detailed review
and arriving at a final determination. The Department of
Commerce's final determination is due by April 6, 2000. The
ITC's final determination, assuming that Commerce makes a
final determination that injury occurred, is due by May 22,
2000. In the meantime, the preliminary duties have led to a
sharp decrease in apple juice concentrate from China.
 
Strawberries Plentiful in 1999
 
The winter of 1999 presented Florida strawberry growers a
near-ideal growing season. Strawberry production increased
15 percent from the previous year. Unlike the previous
winter, this year's winter weather was cooler and has
contributed to a high quality crop. There were cold snaps in
late December 1999 and late January 2000, but they were
brief and did little damage as growers used water sprinklers
to protect their fields. Because of the larger winter crop,
the 1999 season average price received by Florida growers
fell 19 percent from the previous year.
 
While both Florida's planted and harvested winter acreage
for this year have increased 2 percent to 6,300 acres, total
shipments from Florida were running much higher than a year
earlier in January and February. Shipments for the season
were 23 percent behind last year's pace at the end of
December. However, shipments increased markedly in the first
week of January and again in the third week of February. As
of the third week of February, total shipments for the
season were running about 20 percent ahead of the same
period last year. Aside from two brief cold snaps, one in
late December and the other in late January, Florida growers
experienced a mild growing season. The increased shipments
have put downward pressure on prices. Free on board (f.o.b.)
prices per 12, 1-pint baskets of medium to large
strawberries in Central Florida averaged $12 to $14 in
December 1999, $8 to $10 in January 2000, and $6 to $8 in
February. In the same 3 months the previous season
(1998/99), f.o.b. prices averaged $15-$17, $12-$14, and
$7-$8.
 
California, where production averages about 83 percent of
the U.S. total, is expected to have a good growing season as
well. According to the California Strawberry Commission,
planted acreage for 2000 will be up 7 percent from the
previous year. In addition, warm January temperatures have
led to good crop development, and a relatively drier growing
season is yielding good-quality strawberries. Heavy rains at
the end of January briefly disrupted harvesting. The strong
growing seasons in Florida and California put U.S.
production at a record 906,300 short tons in 1999, up 11
percent from the previous year. Production utilized for the
fresh-market increased 12 percent, to 632,100 short tons,
while production for processing rose 1 percent, to 274,200
short tons.
 
For this year, strawberry shipments from California in
January were more than three times the volume of the same
period a year ago, and more than two times last year's
volume in the first two weeks of February. In the third week
of February, however, volume dropped off sharply due in part
to rain and cooler temperatures. Strawberry f.o.b. prices
per flat of 12, 1-pint, baskets were running about $9 to $14
in January, compared with $14 to $28 in January 1999. Prices
in February were about $12 to $14, compared with about $18
the same time last year. Heavy volume during California's
peak season (April-June) will likely put additional downward
pressure on prices. However, expectations of good quality
berries from the 2000 California crop will help boost
domestic and foreign demand, offsetting some of the downward
pressure on prices.
 
Avocado Crop To Rebound in 1999/2000
 
NASS releases the official U.S. avocado crop estimate for
the 1999/2000 season on July 7, 2000. However, based on
estimates from the Florida Agricultural Statistics Service
and the California Avocado Commission (CAC), the U.S.
avocado crop may reach 180,540 short tons, up 15 percent
from the previous season. The Florida Agricultural
Statistics Service estimates certified shipments from the
Florida 1999/2000 crop to be 21,250 tons, down 8 percent
from the 1998/99 season. The decline is partly due to damage
to the Homestead area of Florida from Hurricane Irene in
October 1999. Over the previous three seasons, certified
shipments have averaged 98 percent of the actual Florida
crop as reported by NASS. Hence, estimates of shipment
volume are a good indicator of present crop size. Commercial
avocado varieties in Florida typically mature from June
through March, but most shipments occur from August to
December. Through January 2000, approximately 98 percent of
the estimated certified shipments had been shipped.
 
The pest problems that afflicted the California avocado crop
last season appear to have subsided for the 1999/2000
season, resulting in greater production and higher quality.
Over 85 percent of the U.S. avocado crop is produced in
California, where the harvest usually begins in November and
continues to the following November (table 17). Based on
1999/2000 estimates from the California Avocado Commission,
California's production is expected to increase by 20
percent from the previous season.
 
Because overall domestic supplies in 1999/2000 are
anticipated to exceed last season, avocado prices are likely
to average lower. This contrasts with the 1998/99 season
where the supply of fresh avocados continued a decline from
the previous season, and the season-average price increased
by 36 percent. So far, 1999/2000 shipments from California
from November to late February have been running 8 percent
ahead of last year despite cool and dry weather in January
2000 that delayed harvests. Most of California's shipments
usually occur between March and August. February f.o.b.
prices (shipping-point basis) per 2-layer carton of Hass
avocados in Fresno, California, ranged from $36 to $40 for
size 48's and $32 to $39 for size 60's. During February
1999, prices ranged from $42 to $49 and $35 to $45,
respectively.
 
The United States has been a net importer of avocados since
1989/90. The import share of domestic supplies has risen
from nearly 2 percent of the total during the mid-1970's to
over 11 percent during the 1990's. A larger U.S. crop and
lower domestic prices point to fewer imports in 1999/2000.
USDA's Foreign Agricultural Service (FAS) forecasts U.S.
avocado imports in 1999/2000 to decrease slightly from the
previous year. The largest supplier to the United States is
Chile. Mexico, the world's largest avocado producer, has
continued to increase its importance in the U.S. avocado
import market. After the partial lifting of the
phytosanitary ban on Mexican avocados in effect since 1914,
Mexican avocado exporters began shipping to the United
States in November 1997, but only during November to
February each year. Mexico's share of total U.S. avocado
imports has risen from 1 percent in the 1996/97 season to
about 19 percent in the 1998/99 season. Production for the
1999/2000 season in Mexico is forecast to recover from last
year's freeze and increase by 55 percent. Although only 8
percent of Mexico's avocado production is of export quality,
exports to the United States are forecast to increase 17
percent to 45,000 metric tons.
 
Despite smaller avocado production and generally higher
prices, U.S. avocado exports increased by 44 percent during
the 1998/99 season (November-October). Exports increased for
all of the major markets. Exports to the European Union, the
largest export market for U.S. growers, increased by 79
percent. This is partly due to increased consumption of
avocados in the European Union. Exports to Asia increased 44
percent and exports to North America increased 4 percent.
Because of increased competition from Chile, Mexico, South
Africa, and Israel, the FAS forecasts U.S. exports to
increase little from last season.
 
Stone Fruit Crops Developing on Schedule
 
Early indications point to a strong crop of California stone
fruits in 2000. Abundant supplies of good quality fruit are
expected. Stone fruit orchards in California have received
above-average rainfall, especially in February. Rainfall in
February was at 110 percent above normal, making it the
wettest February on record. Breaks in the rain, combined
with good winds, allowed the blooms, as well as orchard
grounds, to dry. Hence, fungicide application was not
disrupted and the blooms were undamaged from the rain.
 
This winter was milder than the previous one. According to
the California Tree Fruit Agreement, there were 939 chill
hours as of the end of February. There were 1,331 chill
hours last winter. Chill hours are the amount of time the
temperature is below 45 degrees Fahrenheit. Although there
were fewer chill hours this winter, it was sufficient for
the trees to achieve dormancy. Trees that go through a full
dormant stage tend to produce strong fruit, meaning fruit
that is less susceptible to pests and diseases, less prone
to bruising, and has a longer shelf life.
 
The timing of this season's stone fruit development is about
normal, as opposed to the late starts last season. The early
varieties of nectarines, May Glow in particular, were in
full bloom by February 7, followed by Red Beaut plums on
February 13. By late February, orchards were in full bloom,
indicating that there will be a full crop. A strong growing
season may put downward pressure on prices.
 
Chilean Fruit Imports Grew Throughout the Nineties
 
Fresh fruit from Chile have become a standard in American
supermarkets from November through March. Because Chile is
located in the Southern Hemisphere, its production is on
alternate seasons with the United States and therefore able
to provide summer fruit to the U.S. market during our winter
months. This has allowed for year round consumption of fresh
fruit such as grapes, peaches, pears, and plums that would
otherwise be unavailable during the winter. With American
consumers now accustomed to the wider array of fruit
available during this time, Chilean imports have seen steady
growth, increasing at an average of 31 percent a year for
major products. Grapes are by far the largest single fruit
import from Chile, with the United States importing about
606 million pounds in 1999. This amount, however, is about
20 percent less than in 1990. The next most important fruit
import from Chile is peaches, followed by apples, pears,
avocados, and plums. Chile grows peaches, pears, and plums
specifically for export. The fruit not meeting voluntary
standards set for export go into its domestic market.
 
Chile provides fresh summer fruit to the European market
during its winter months as well. In fact, the European
Union is the larger market for most stone fruit, while the
United States dominates their export market for grapes and
avocados. Neighbors in South America, such as Argentina and
Brazil also provide important markets for Chilean fruit.
These countries have yet to develop their own export-quality
fruit production to a level that would make them competitive
with Chile in the world market.  Japan is still a new market
for Chilean fresh fruit.
 
In 1999, U.S. imports of major Chilean fresh fruit increased
34 percent over 1998. Most of the increase was from larger
shipments of stone fruit-peaches and plums, as well as pears
and berries, such as blueberries and raspberries. Chile's
summer fruit benefited from good weather as well as the
reduced supply of oranges available in American markets in
1999, increasing consumer demand for substitutes. Imports
are expected to be down in 2000 for stone fruit and possibly
for pears due to harsh weather conditions during bloom.
 
Grape imports fell 5 percent in 1999 from the previous year.
Poor growing conditions in Chile delayed harvesting and
lowered fruit quality, therefore less was available for
export. Higher unit value of the 1999 grape crop, however,
resulted in a 10-percent increase in the value of grape
imports for the year. About 55 percent of Chilean grape
exports go to the United States. Imports for 2000 are
projected higher because of increased production in Chile
and the good quality of the fruit. The good supply and
quality of this year's fruit should result in increased
promotions this winter for table grapes, and that should
result in lower retail prices.
 
Chile is the major foreign supplier of avocados to the U.S.
market. Avocado imports declined in 1999 compared with 1998
because 1998 was such a good year for production. In 1998,
Chile experienced ideal growing conditions for avocados and
new trees coming into production or in the increasing
production stage. Despite the import decline in 1999,
quantities were still much higher than any other year in the
nineties. Imports are expected to increase again in 2000 as
yields are expected to be higher due to the
alternate-bearing pattern of the trees, coupled with good
growing conditions. Virtually all of Chile's avocado exports
are destined for the U.S. market.
 
Concentrated juice imports rose sharply in 1999 from the
previous year. Apple juice concentrate imports rose to 64
million gallons, single-strength equivalent, almost double
the previous year. Chile produces apple juice concentrate
(AJC) for export, little is consumed domestically.
Traditionally, processing plants received the rejects of
apples destined for the export market. The apples going to
market in 1999 were generally of a low quality, making more
fruit available for juice. Exports to the United States were
further boosted by the anticipated decision by the U.S.
Department of Commerce to put countervailing duties on
China's AJC imports because of dumping. Many U.S. importers
chose to buy larger amounts of AJC from other sources, like
Chile, in case retroactive duties would have to be paid on
China's imports. Chile's apple harvest is expected to be
down for the 2000 marketing season, and that could lower the
quantity of fruit available for juice. However, demand for
AJC from Chile is likely to continue from the U.S. imports,
which could cause diversion from the fresh market to
processors.
 
Tree Nut Outlook
                              
Acreage and Production Reached Records, But Prices Fell for
Most Tree Nut Crops
 
Acreage of five major tree nut crops (almonds, hazelnuts,
walnuts, pistachios, and macadamias) reached a record high
of 792,100 bearing acres in 1999, 3 percent higher than
1998. Estimates are not available for bearing acreage of
pecans. Production increased sharply in 1999 for all of the
major tree nuts, except pistachios and macadamia nuts, to a
record total of 1.25 million tons, in-shell equivalent, up
38 percent from the previous season. The preliminary
estimate of the value of production for these six tree nut
crops is $1.5 billion, up approximately 9 percent above the
1998 combined all tree nut value, but 29 percent lower than
the record value set in 1997. Since the value of the 1999
walnut crop is not currently available, the total tree nut
value estimate includes an estimate of $297 million based
upon preliminary industry prices.
 
Almond Acreage, Production Hit New Highs, Price and Value
Declined
 
Bearing acres of California almonds continue to rise and hit
a new high of 480,000 acres. Yield per bearing acre in 1999
increased sharply to a record 1,730 pounds, which boosted
production to a record 830 million pounds, shelled basis.
The 1999 crop was 60 percent higher than the 1998 output and
compares with the previous record crop of 759 million pounds
harvested in 1997. Beginning stocks on August 1, 1999, were
at a low 91.8 million pounds, which partially offset the
higher new crop supply for the 1999/2000 season.
 
Due to the record high production, grower prices fell to
$.85 per pound compared with $1.41 during the 1998/99 season
and $1.56 in 1997/98. Even though grower prices were down
substantially, the higher production pushed total almond
cash receipts for growers to $677 million, off 4 percent
from 1998 and 42 percent below the record crop value set in
1997.
 
The January 2000 almond industry report by the Almond Board
of California showed domestic shipments to date (August 1,
1999-January 31, 2000) of 117 million pounds, up 31 percent
from the same period last year, while export shipments
totaled 310 million pounds to date, up 33 percent. The
computed inventory as of February 1, 1999, stood at 278
million pounds, of which 178 million pounds were commitments
(sold, but not delivered). If almond demand continues strong
in domestic and international markets, then ending stocks
could be about 60 million pounds of salable stock, excluding
reserve tonnage which could be released by the Almond Board
to meet market needs.
 
So far this season, shipments have been higher to North
American markets (Canada and Mexico), Western and Eastern
Europe, Asia, the Middle East, New Zealand and Australia,
and Africa. However, shipments to South America have been
lower. U.S. almonds should continue to be very price
competitive in major markets due to the much lower prices
this season and the U.S. offering the highest quality
product available. However, early season forecasts for the
1999 harvest were that better than average crops were
expected in Spain, Turkey, Greece, and Italy. This large
world supply coupled with the record U.S. supply will
greatly impact demand, price, and competition for U.S.
almonds in Europe and other major markets.
 
The 2000 almond harvest in California is likely to be lower
due to the alternate-bearing nature of the almond tree and
because weather this spring during the bloom period has been
generally unfavorable, inhibiting pollination. An increase
in bearing acreage, however, will somewhat offset this
decline. The first forecast for the 2000 California almond
crop will be issued in the USDA's May 12, 2000, Crop
Production report.
 
Pistachio Acreage is a Record, Production and Value Lower
 
California pistachio bearing acreage in 1999 increased to a
new high of 71,000 acres. The yield decreased sharply to
1,730 pounds per acre, which resulted in a crop production
of 123 million pounds, in-shell basis. The grower price
jumped to $1.31 per pound, but the resulting crop value of
$161 million was 17 percent lower than 1998. In 2000, the
pistachio harvest is likely to be substantially higher since
the trees will be in the "on-year" of the production cycle.
The pistachio tree is very "alternate bearing" in its
physiological nature, producing heavy yields one year and
then "resting" or building reserves and producing a light
crop yield the following year.
 
According to the California Pistachio Commission (CPC),
in-shell domestic shipments through January are lower this
season than the three previous seasons. Domestic in-shell
shipments to date are nearly 41 million pounds, 70 percent
of the total, and export in-shell shipments to date are 17
million pounds, 30 percent of the total. Domestic in-shell
demand has been stronger than export demand. Shipments of
closed shell product, loose kernels, and shelling stock to
export and domestic markets are much lower this season and
well below recent historic levels.
 
The CPC reports an open in-shell inventory of 34.2 million
pounds on hand as of January 31, 2000, 7.4 million pounds of
closed shell inventory, 3.4 million pounds of loose kernels,
and 6.2 million pounds of shelling stock. The entire
inventory is reportedly committed at this time. A much
smaller projected carryover stock is expected and would help
to moderate a larger expected crop supply for the 2000/01
season.
 
For 1999, production of pistachios was above average for
crops in Iran, Greece, Italy, and Syria. However, there is
no further information available at this time on the final
outcomes of harvested production in these countries.
 
Pecan Production Up Sharply, Prices Fall
 
The preliminary estimate for pecan production in 1999 is 342
million pounds, in-shell basis, substantially higher than
the small crop of 146 million in 1998, and slightly above
the 1997 crop of 335 million pounds. Production of improved
pecans more than doubled to nearly 232 million pounds, while
production of seedling and native pecans tripled to about
110 million pounds. Production was higher in all 14
commercial pecan producing States, except North and South
Carolina.
 
Grower prices decreased for improved pecans to a preliminary
estimate of $.97 per pound in 1999/2000, in-shell basis,
compared with $1.35 in 1998/99 and $.93 during the 1997/98
marketing season. The preliminary grower price estimate for
the native and seedling pecans is $.53 per pound for the
1999/2000 season, in-shell basis, compared with $.77 the
prior season and $.53 in 1997/98. These prices resulted in a
total crop value in 1999 of $284 million compared with $177
million in 1998 and $259 million in 1997. These preliminary
production, price, and value estimates will be updated and
published in the USDA's Noncitrus Fruit and Tree Nuts
Summary report to be issued on July 7, 2000.
 
The beginning stocks for all pecans on July 1, 1999, were 46
million pounds, shelled equivalent basis. Combined with a
new crop supply of about 150 million shelled pounds and
25-30 million pounds of imported pecans, supply will total
225 million pounds, higher than the 1998/99 supply but a
little smaller than the large supply situation during the
1997/98 season. Cold storage stocks of pecans in all
warehouses on January 31, 2000, were nearly 34 million
pounds of shelled pecans, moderately higher than the
previous year, while in-shell pecan stocks were double at
236 million pounds. The net result is that the shelled
equivalent of all pecans in storage was an estimated 250
million pounds, 140 percent higher this January than January
31, 1999. This may indicate that domestic and export markets
are slow to absorb the larger new crop supply at higher
prices, even though the 1999 crop is of high quality. Also,
it may indicate increased competition with walnuts in
domestic markets due to the record large walnut supply.
 
Walnut Acreage Steady, Yield and Production Set Records
 
Bearing acreage of California English walnuts remained
unchanged in 1999 at 193,000 acres. Yield per bearing acre
was the highest on record at 1.47 tons per acre, well above
average crop yields in recent years. Harvested production
was 283,000 tons, in-shell basis, setting a record.
 
In-shell shipments to date (August 1, 1999-January 31, 2000)
totaled 143 million pounds, up 35 percent from the same
period a year ago. Both domestic and export shipments of
in-shell walnuts are higher. Shelled shipments to date total
101 million pounds compared with about 92 million the
previous year. Both domestic and export shelled demand have
been moderately better this marketing season. The net result
of all shipments shows 191,771 tons, in-shell equivalent,
have been shipped to date to all markets compared with
162,410 tons last season. Domestic demand to date has been
94,303 tons, up 3 percent, while export demand has been
104,024 tons, up 9 percent. Export demand to date has been
87,747 tons, 31 percent higher than for the same period last
year. Demand for U.S. exports should continue strong as the
season progresses and foreign supplies reduce. The available
supply from other countries such as China is a "short-lived"
situation in the fall-winter that can create a temporary
glut. Generally, most countries neither have the storage and
shipping capabilities as the United States nor is the
quality as high as U.S. product.
 
The 1999 walnut production in China was a record 260,000
metric tons, in-shell basis. Other walnut producing
countries such as India, France, and Chile were down
slightly, while Italy was up and Turkey was unchanged. With
the record U.S. crop, the world production was a record, and
combined with large carryover stocks, total world supply was
a record.
 
Hazelnut Acreage Slips, But Production and Value Are Up
 
The U.S. hazelnut production rebounded sharply to 38,000
tons, in-shell basis, as a result of the much-improved yield
of 1.30 tons per acre. The 1999 crop was substantially
higher than the small crop of only 15,500 tons harvested in
1998, but 19 percent lower than the record crop of 47,000
tons set in 1997. Grower prices were down, estimated at $882
per ton for the 1999/2000 marketing season compared with
$964 in 1998/99 and $899 for marketing year 1997/98.
 
Somewhat surprising, in lieu of the large available supply,
is that domestic in-shell shipments to date (July 1,
1999-December 31, 1999) have been only moderately higher
than last year when crop supply was substantially lower.
Likewise, export in-shell shipments are only slightly higher
this season. Kernel production is much higher this year, but
shipments of kernels to domestic and export markets are only
modestly above last season to date.
 
Turkey, the world's largest producer of hazelnuts, reported
a smaller crop of 560,000 metric tons. Large crops were also
harvested in Italy at 105,000 metric tons and Spain at
25,000.
 
Macadamia Nut Acreage, Yield, and Production Lower
 
The Hawaiian macadamia nut production decreased to 53
million pounds, in-shell wet basis, due to a lower yield of
2,800 pounds per acre and a decline in bearing acreage to
18,900 acres. The 1999 crop compares with 57.5 million
pounds harvested in 1998 and a record crop of 58 million
pounds set in 1997. The estimated grower price increased
slightly to $.67 per pound compared with $.65 in 1998.
 
Good crops or record production was set in 1999 in most
countries producing macadamia nuts for a world production
total of 80,000 metric tons, in-shell basis, virtually the
same as in 1998. The forecast for year 2000 crops is for
about 91,000 metric tons, a world record.
 
END_OF_FILE