Required Report - public distribution

**Date:** 12/28/2005

**GAIN Report Number:** AS6001

AS6001

**Australia**

**Fresh Deciduous Fruit**

**Annual**

**2006**

**Approved by:**

![](media/image1.wmf)Kathleen Wainio, Agricultural Counselor

U.S. Embassy

**Prepared by:**

Mike Darby, Agricultural Specialist

**Report Highlights:**

Australian apple production in 2006 is forecast to decline to 280 TMT
following historically high production in 2005. Pear production in 2006
is forecast at 145 TMT. Establishing market access for U.S. apples to
Australia is a high priority for USDA. GOA import policy for U.S. apples
will be based on conditions for New Zealand apples. The comment period
for the import risk analysis report (IRA) for New Zealand apples closes
on March 30, 2006.

Includes PSD Changes: Yes

Includes Trade Matrix: No

Annual Report

Canberra \[AS1\]

\[AS\]

Table of Contents

[SECTION ONE: SITUATION AND OUTLOOK
3](#section-one-situation-and-outlook)

[SECTION TWO: STATISTICAL TABLES 4](#section-two-statistical-tables)

[SECTION THREE: NARRATIVE ON SUPPLY AND DEMAND, POLICY & MARKETING
6](#section-three-narrative-on-supply-and-demand-policy-marketing)

[Apples 6](#apples)

[Production 6](#production)

[Trade 6](#trade)

[Exports 6](#exports)

[Marketing 7](#marketing)

[Policy 7](#policy)

[Pears 7](#pears)

[Production 7](#production-1)

[Trade 8](#trade-1)

[Exports 8](#exports-1)

[Imports 9](#imports)

# SECTION ONE: SITUATION AND OUTLOOK

Apples are grown commercially in all of Australia's states and
territories, except the Northern Territory. According to a recent
Australian Bureau of Statistics (ABS) agricultural survey, Victoria is
the largest producing state, with about 36 percent of national
production, followed by New South Wales (20%), Tasmania (17%), Western
Australia (11%), South Australia (9%), and Queensland (7%). Australia's
major apple varieties have traditionally been Granny Smith and Red
Delicious, which still constitute over 50 percent of national apple
production. Gala, Fuji, Cripps Pink (Pink Lady) and Cripps Red
(Sundowner) account for about one-third of production, and are growing
in importance. Apples grown in temperate regions of Australia are
irrigated.

# SECTION TWO: STATISTICAL TABLES

+---------------------+------+------+------+------+------+------+------+
| **PSD Table**       |      |      |      |      |      |      |      |
|                     |      |      |      |      |      |      |      |
| Apples, Fresh       |      |      |      |      |      |      |      |
+---------------------+------+------+------+------+------+------+------+
|                     | **20 | **R  | **20 | **Es | **20 | **Fo | *    |
|                     | 03** | evis | 04** | tima | 05** | reca | UOM* |
|                     |      | ed** |      | te** |      | st** |      |
+---------------------+------+------+------+------+------+------+------+
|                     | **   | **   | **   | **   | **   | **   |      |
|                     | USDA | Post | USDA | Post | USDA | Post |      |
|                     | Offi | Es   | Offi | Es   | Offi | Es   |      |
|                     | cial | tima | cial | tima | cial | tima |      |
|                     | \    | te** | \    | te** | \    | te** |      |
|                     | [Old |      | [Old |      | [Old |      |      |
|                     | \]** | **\  | \]** | **\  | \]** | **\  |      |
|                     |      | [New |      | [New |      | [New |      |
|                     |      | \]** |      | \]** |      | \]** |      |
+---------------------+------+------+------+------+------+------+------+
| **Market Year       |      | **0  |      | **0  |      | **0  | *    |
| Begin**             |      | 1/20 |      | 1/20 |      | 1/20 | MM/Y |
|                     |      | 04** |      | 05** |      | 06** | YYY* |
+---------------------+------+------+------+------+------+------+------+
| **Area Planted**    | 2    | 2    | 2    | 2    | 0    | 2    | *(   |
|                     | 1000 | 1000 | 0000 | 0500 |      | 0000 | HA)* |
+---------------------+------+------+------+------+------+------+------+
| **Area Harvested**  | 0    | 0    | 0    | 0    | 0    | 0    | *(   |
|                     |      |      |      |      |      |      | HA)* |
+---------------------+------+------+------+------+------+------+------+
| **Bearing Trees**   | 8731 | 8834 | 8420 | 9383 | 0    | 9450 | *(   |
|                     |      |      |      |      |      |      | 1000 |
|                     |      |      |      |      |      |      | TRE  |
|                     |      |      |      |      |      |      | ES)* |
+---------------------+------+------+------+------+------+------+------+
| **Non-Bearing       | 1659 | 1621 | 1840 | 1617 | 0    | 1600 | *(   |
| Trees**             |      |      |      |      |      |      | 1000 |
|                     |      |      |      |      |      |      | TRE  |
|                     |      |      |      |      |      |      | ES)* |
+---------------------+------+------+------+------+------+------+------+
| **Total Trees**     | 1    | 1    | 1    | 1    | 0    | 1    | *(   |
|                     | 0390 | 0455 | 0260 | 1000 |      | 1050 | 1000 |
|                     |      |      |      |      |      |      | TRE  |
|                     |      |      |      |      |      |      | ES)* |
+---------------------+------+------+------+------+------+------+------+
| **Commercial        | 25   | 25   | 30   | 33   | 0    | 28   | *(   |
| Production**        | 0000 | 5000 | 0000 | 0200 |      | 5000 | MT)* |
+---------------------+------+------+------+------+------+------+------+
| **Non-Comm.         | 0    | 0    | 0    | 0    | 0    | 0    | *(   |
| Production**        |      |      |      |      |      |      | MT)* |
+---------------------+------+------+------+------+------+------+------+
| **TOTAL             | 25   | 25   | 30   | 33   | 0    | 28   | *(   |
| Production**        | 0000 | 5000 | 0000 | 0200 |      | 5000 | MT)* |
+---------------------+------+------+------+------+------+------+------+
| **TOTAL Imports**   | 0    | 0    | 0    | 0    | 0    | 0    | *(   |
|                     |      |      |      |      |      |      | MT)* |
+---------------------+------+------+------+------+------+------+------+
| **TOTAL SUPPLY**    | 25   | 25   | 30   | 33   | 0    | 28   | *(   |
|                     | 0000 | 5000 | 0000 | 0200 |      | 5000 | MT)* |
+---------------------+------+------+------+------+------+------+------+
| **Domestic Fresh    | 11   | 11   | 12   | 15   | 0    | 12   | *(   |
| Consump**           | 0000 | 0000 | 0000 | 0000 |      | 0000 | MT)* |
+---------------------+------+------+------+------+------+------+------+
| **Exports, Fresh    | 1    | 1    | 3    | 1    | 0    | 1    | *(   |
| Only**              | 5000 | 0177 | 0000 | 3230 |      | 2000 | MT)* |
+---------------------+------+------+------+------+------+------+------+
| **For Processing**  | 12   | 13   | 15   | 16   | 0    | 15   | *(   |
|                     | 5000 | 4823 | 0000 | 6970 |      | 3000 | MT)* |
+---------------------+------+------+------+------+------+------+------+
| **Withdrawal From   | 0    | 0    | 0    | 0    | 0    | 0    | *(   |
| Market**            |      |      |      |      |      |      | MT)* |
+---------------------+------+------+------+------+------+------+------+
| **TOTAL             | 25   | 25   | 30   | 33   | 0    | 28   | *(   |
| UTILIZATION**       | 0000 | 5000 | 0000 | 0200 |      | 5000 | MT)* |
+---------------------+------+------+------+------+------+------+------+

+-------------------+-----+------+-----+------+-----+------+------+
| **PSD Table**     |     |      |     |      |     |      |      |
|                   |     |      |     |      |     |      |      |
| Pears, Fresh      |     |      |     |      |     |      |      |
+-------------------+-----+------+-----+------+-----+------+------+
|                   | **  | **R  | **  | **Es | **  | **Fo | *    |
|                   | 200 | evis | 200 | tima | 200 | reca | UOM* |
|                   | 3** | ed** | 4** | te** | 5** | st** |      |
+-------------------+-----+------+-----+------+-----+------+------+
|                   | **U | **   | **U | **   | **U | **   |      |
|                   | SDA | Post | SDA | Post | SDA | Post |      |
|                   | Of  | Es   | Of  | Es   | Of  | Es   |      |
|                   | fic | tima | fic | tima | fic | tima |      |
|                   | ial | te** | ial | te** | ial | te** |      |
|                   | \[O |      | \[O |      | \[O |      |      |
|                   | ld\ | **\  | ld\ | **\  | ld\ | **\  |      |
|                   | ]** | [New | ]** | [New | ]** | [New |      |
|                   |     | \]** |     | \]** |     | \]** |      |
+-------------------+-----+------+-----+------+-----+------+------+
| **Market Year     |     | **0  |     | **0  |     | **0  | *    |
| Begin**           |     | 1/20 |     | 1/20 |     | 1/20 | MM/Y |
|                   |     | 04** |     | 05** |     | 06** | YYY* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Area Planted**  | 7   | 7050 | 6   | 6875 | 0   | 6850 | *(   |
|                   | 050 |      | 875 |      |     |      | HA)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Area            | 1   | 1171 | 1   | 1060 | 0   | 1055 | *(   |
| Harvested**       | 171 |      | 060 |      |     |      | HA)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Bearing Trees** | 1   | 1724 | 1   | 1732 | 0   | 1750 | *(   |
|                   | 647 |      | 627 |      |     |      | 1000 |
|                   |     |      |     |      |     |      | TRE  |
|                   |     |      |     |      |     |      | ES)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Non-Bearing     | 328 | 335  | 298 | 322  | 0   | 320  | *(   |
| Trees**           |     |      |     |      |     |      | 1000 |
|                   |     |      |     |      |     |      | TRE  |
|                   |     |      |     |      |     |      | ES)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Total Trees**   | 1   | 2059 | 1   | 2054 | 0   | 2070 | *(   |
|                   | 975 |      | 925 |      |     |      | 1000 |
|                   |     |      |     |      |     |      | TRE  |
|                   |     |      |     |      |     |      | ES)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Commercial      | 141 | 14   | 150 | 15   | 0   | 14   | *(   |
| Production**      | 000 | 2000 | 000 | 0000 |     | 5000 | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Non-Comm.       | 0   | 0    | 0   | 0    | 0   | 0    | *(   |
| Production**      |     |      |     |      |     |      | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **TOTAL           | 141 | 14   | 150 | 15   | 0   | 14   | *(   |
| Production**      | 000 | 2000 | 000 | 0000 |     | 5000 | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **TOTAL Imports** | 4   | 4820 | 3   | 2622 | 0   | 3000 | *(   |
|                   | 000 |      | 000 |      |     |      | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **TOTAL SUPPLY**  | 145 | 14   | 153 | 15   | 0   | 14   | *(   |
|                   | 000 | 6820 | 000 | 2622 |     | 8000 | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Domestic Fresh  | 80  | 8    | 80  | 8    | 0   | 8    | *(   |
| Consump**         | 000 | 0000 | 000 | 0000 |     | 0000 | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Exports, Fresh  | 9   | 9546 | 15  | 9403 | 0   | 9200 | *(   |
| Only**            | 000 |      | 000 |      |     |      | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **For             | 56  | 5    | 58  | 6    | 0   | 5    | *(   |
| Processing**      | 000 | 7274 | 000 | 3219 |     | 8800 | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **Withdrawal From | 0   | 0    | 0   | 0    | 0   | 0    | *(   |
| Market**          |     |      |     |      |     |      | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+
| **TOTAL           | 145 | 14   | 153 | 15   | 0   | 14   | *(   |
| UTILIZATION**     | 000 | 6820 | 000 | 2622 |     | 8000 | MT)* |
+-------------------+-----+------+-----+------+-----+------+------+

# SECTION THREE: NARRATIVE ON SUPPLY AND DEMAND, POLICY & MARKETING

## Apples

### Production

Australian apple production is forecast at 280,000 MT in CY 2006.
Industry sources suggest that production is likely to fall following the
historically high production year of CY 2005. However, improved soil
moisture levels and irrigation water supplies is likely to see improved
fruit size and quality. Post has assumed average weather conditions for
the CY 2006 crop.

Apple production in CY 2005 has been revised to 330,200 MT, an
historically high level. Slightly improved rainfall totals in key areas,
and exceptionally well-timed rainfall, combined to push production to
historically high levels.

![](media/image2.wmf)

*Source: DAFF data.*

### Trade

#### Exports

Australian apple exports in CY 2006 are forecast at 12,000 MT, a decline
commensurate with the reduced forecast level of production. Changes in
actual production levels would likely lead to changes in exports.
Furthermore, significantly improved quality levels, as suggested by
industry sources, could potentially lead to a higher supply in apples
suitable for export.

Apple exports in CY 2005 are estimated at 13,230, in line with official
Australian Bureau of Statistics (ABS) year-to-date data. This estimate
remains well below the historical average and reflects extreme drought
conditions; below average quality and difficult export conditions.
Exports to India, the UK, Sri Lanka and Malaysia account for 62 percent
of total exports. India, Australia largest export market for pears, is a
relatively new export destination for Australian horticultural products.

![](media/image3.wmf)

*Source: DAFF data.*

### Marketing

Apple and Pear Australia Limited (APAL), a non-profit public company, is
the main industry body representing the interests of Australia's 2,000
commercial apple and pear growers. APAL's major concerns are legislation
and regulations affecting the industries, marketing, research and
development.

With regard to marketing, the majority of Australia's apple and pear
exports are marketed under the "AUSTRALIAfresh" brand.
"Australia*fresh"* apple and pear promotional programs have been planned
for a number of countries including: India, UK, New Zealand, Malaysia,
Singapore, Taiwan, Hong Kong, Canada, and Indonesia.

Programs will provide extensive coverage for apples and pears with three
major retailers. Activities include sampling programs, merchandising of
point-of-sale material, staff incentive programs, catalogue advertising
and consumer competitions.

Horticulture Australia Limited (HAL) is owned by its members, who
comprise of 28 horticultural industries (including apples and pears) and
is funded through a statutory levy system. Apple and pear growers pay
statutory levies of A\$1.53 cents per kilogram and A\$1.64 cents per
kilogram, respectively.

### Policy

On December 1, 2005 Biosecurity Australia issued a revised draft import
risk analysis report (IRA) assessing an application from New Zealand to
export apples to Australia. The extended comment period for the draft
IRA closes on March 30, 2006. Establishing market access for U.S. apples
to Australia is a high priority for USDA. In response to USDA\'s 2000
request that Australia initiate an IRA for U.S. apples, the Government
of Australia has stated that it first intends to issue the final IRA for
New Zealand apples, and access for U.S. apples would then be addressed
through a modification of the New Zealand import policy. (See Gain
Report AS 5044 for further information.)

## Pears

### Production

Australian pear production in 2006 is forecast at 145 TMT. Industry
sources suggest production will likely fall to this level following a
relatively larger year in the production cycle. Despite the lower
forecast, at this stage the CY 2006 crop is likely see average to above
average quality, assuming average weather conditions. Lower yield
combined with improve moisture levels is likely to see fruit size and
quality increase.

Pear production in CY 2005 is estimated at 150 TMT. Historical data
suggests this to be around an average sized crop. Recent drought has
seen production fall markedly in recent years. For these reasons the CY
2005 crop is forecast well above the trend line established using
historical data.

![](media/image4.wmf)

*Source: DAFF data*

### Trade

#### Exports

Australian pear exports in CY 2006 are forecast to decline to 9.2 TMT,
the result of the decrease in production. Average crop quality may also
affect changes in fruit volumes available for export. Post advises that
crop quality in CY 2006 is likely to vary from average to above average
assuming average weather conditions.

Exports of pears for 2005 are estimated at 9.4 TMT, in line with ABS
year-to-date data, an historically low level. Pear exports have proved
cyclical over the past decade, however drought and poor biological
conditions have seen levels of fruit suitable for export fall to well
below average.

Canada and New Zealand were Australia's two largest export markets for
pears in CY 2004, accounting for around 26 percent of total exports.
Indonesia, Singapore, Hong Kong and Malaysia are Australia's next
largest markets for pears respectively, accounting for around 43 percent
of exports collectively. India, although Australia's seventh largest
exports market, increased its demand three fold in CY 2004.

![](media/image5.wmf)

*Source: DAFF data*

#### Imports

Pear imports in CY 2006 are forecast at 3 TMT. Slightly lower domestic
production, combined with the steady increase of imports in recent
times, is likely to see imports increase significantly in CY 2006.

Pear imports for CY 2005 are estimated at 2.6 TMT. This figure is in
line with ABS year-to-date data.

**Recent Reports from FAS/Canberra**

The reports listed below can be downloaded from the FAS website at:
<http://www.fas.usda.gov/scriptsw/AttacheRep/default.asp>.

  ---------- --------------------------------------------------- ----------
  **Report   **Title of Report**                                 **Date**
  Number**                                                       

  5001       Fresh Deciduous Fruit Annual                        01/04/05

  5044       Australia Issues Draft IRA Report for Apples from   12/02/05
             New Zealand                                         
  ---------- --------------------------------------------------- ----------