Required Report - public distribution

**Date:** 10/28/2004

**GAIN Report Number:** EG4024

EG4024

**Egypt**

**Citrus**

**ANNUAL**

**2004**

**Approved by:**

![](media/image1.wmf)Asif J. Chaudhry

US Embassy

**Prepared by:**

Fred Giles & Sherif Ibrahim

**Report Highlights:**

The EU-Egyptian Partnership Agreement, which offers tariff concessions
for Egyptian oranges, went into effect in June 2004. As a direct result,
Egyptian orange exports are expected to remain strong next year.

Includes PSD Changes: Yes

Includes Trade Matrix: Yes

Unscheduled Report

Cairo \[EG1\]

\[EG\]

Table of Contents

[Fresh Oranges 3](#fresh-oranges)

[Production 3](#production)

[Consumption 4](#consumption)

[Trade 4](#trade)

[Export Trade Matrix 5](#export-trade-matrix)

[Tangerines 6](#tangerines)

[Production 6](#production-1)

[Consumption 6](#consumption-1)

[Trade 7](#trade-1)

[Fresh Citrus, Other Stocks 7](#fresh-citrus-other-stocks)

[Production 7](#production-2)

# 

# Fresh Oranges

  ---------------------- ------------- ------------- -------- ------------- -------- -------------
  **PSD Table**                                                                      

  **Country:**           **Egypt**                                                   

  **Commodity:**         **Oranges**                                                 

                                       **2002**               **2003**               **2004**

                         Old           New           Old      New           Old      New

  **Market Year Begin**                **10/2002**            **10/2003**            **10/2004**

  Area Planted           88            88            89       89            0        89

  Area Harvested         85            85            86       85            0        86

  Bearing Trees          4509          4565          4583     4567          0        4570

  Non-Bearing Trees      3815          3800          3850     3805          0        3850

  TOTAL No. Of Trees     8324          8365          8433     8372          0        8420

  Production             1725          1734          1742     1740          0        1750

  Imports                0             0             0        0             0        0

  **TOTAL SUPPLY**       1725          **1734**      1742     **1740**      0        **1750**

  Exports                270           416           400      420           0        450

  Fresh Dom. Consumption 1420          1281          1305     1283          0        1263

  Processing             35            37            37       37            0        37

  **TOTAL DISTRIBUTION** 1725          **1734**      1742     **1740**      0        **1750**
  ---------------------- ------------- ------------- -------- ------------- -------- -------------

## Production 

Oranges are a winter fruit well-suited to the Egyptian climate. Orange
production accounts for well over half the total fruit production in
Egypt. Orange cultivation is centered in two large geographic regions:
the fertile Delta area and the newly reclaimed lands. About 80 percent
of Egypt's total oranges production is on large farms (10-100 feddans)
and 20 percent is produced by small farms (1-10 feddans) (one feddan is
equivalent to .42 hectare). Navel oranges are the predominant variety.
Smaller amounts of local (baladi), sweet, valencia, and other varieties
are also produced. The harvest of navel oranges begins in October and is
followed by other varieties in November and December. The harvest
usually lasts from 4 to 5 months.

Total planted orange area in 2003 was estimated at 89,000 hectares,
1,000 hectares over the 2002 level. Total orange production in 2003 also
increased slightly over the 2002 level. The increase in orange
production was mainly due to the increase in average yield, 20.5
MT/hectare in 2003/2004 compared to 20.4 MT/ hectare in 2001/2002. The
increase in yield was due to the absence of strong winds which usually
cause damage to fruit sets. For the 2004/2005 season, both orange area
and production are expected to increase slightly. This expected increase
in production is due to the increased number of bearing trees and the
continued absence of strong winds.

## 

# Consumption

Oranges are the main fruit available in Egypt during the winter. Due to
the fact that oranges are relatively inexpensive, Egyptians consume
large amounts of oranges, both fresh and as juice. Per capita
consumption of oranges is estimated at about 21 kg per year. The orange
processing industry is expanding due to the increased number of
companies producing orange juice. At the present time, there are six
major orange juice processors in Egypt. Most companies depend on the
baladi and summer varieties for processing. Domestic production is
primarily destined for fresh consumption. Imported orange juice is also
available in the market. Egyptian citrus grown in arid areas (reclaimed
desert land) is characterized by low juice content, while fruit produced
in the more humid regions, mainly along the Red Sea and Mediterranean
coast, has much higher juice content.

## Trade

The Egyptian orange export season is relatively long, extending from
December to April, and this is quite favorable for the export of navel
oranges. Although Egypt has excellent opportunities for expanding its
orange exports due to its favorable climate and strategic geographic
location, exports to the European market continue to be limited by the
uneven quality of Egyptian oranges as well as by competition from other
suppliers such as Spain, Israel, and Morocco. European countries import
baladi and summer varieties, mainly for juicing, while Saudi Arabia is
currently the largest market for Egyptian table oranges. Total Egyptian
orange exports in 2003/2004 increased slightly and are estimated at
420,000 MT. Orange exports to Russia, Ukraine and EU countries are the
primary reason for the increase.

In 2003/04, the government reduced the export subsidy to orange
exporters to \$50 per MT from \$75 per MT. This program was designed to
increase the competitiveness of Egyptian oranges in the export market.
Orange exporters, are unwilling to use the subsidy program as it
requires participating exporters to hand over all foreign exchange
earning to the government. Exports for 2004/05 are expected to increase
to 450,000 MT as a result of the activation of the EU-Egyptian
partnership agreement. The current average export price for fresh
oranges is between \$290 and \$300/MT, the same as during the same
period last season (beginning of export season). Exporters reported that
prices are expected to be about \$ 260/MT by the end of the 2004/2005
season, a decrease due to increase of supply.

The EU-Egyptian Partnership Agreement which was signed in June 2001 and
went into effect in June 2004, offers several tariff concessions for
Egyptian orange exporters. Following the implementation of the
agreement, Egypt will receive a duty-free 50,000 MT TRQ for fresh or
dried oranges (080510). The TRQ will increase by ten percent of the new
base (50,000 MT) over three years with a cap of 60,000 MT in the final
year and beyond. The current TRQ for oranges is 8,000 MT at zero duty
from December through May, provided that the entry price is at least EUR
266/MT.

The following provision apply to Egypt's orange TRQ. Fresh sweet oranges
which fall in headings 08051010, 08051030 and 08051050 can only be
imported into the EU from December 1 to May 31 with a limit of no more
than 34,000 MT at an agreed entry price of EUR 264/MT. If the price for
a consignment is lower than 92 percent of the agreed entry price, the
specific duty bound within the WTO will apply. Export quantities above
the TRQ amount will be assessed at 60 percent of the EU's MFN tariff.

Egyptian exporters prefer to sell their production for cash on an FOB
basis in order to avoid the risk of being rejected due to sanitary-
phytosanitary (SPS) reasons or being in a position to face adjusted
prices due to quality factors. At the present time, there are about 20
private sector, small to medium size exporters and four large orange
exporters in Egypt. According to industry experts, three major companies
control about 80 percent of the export market. One public sector company
still active in the orange sector controls about 20 percent of the
export market.

## 

# Export Trade Matrix

  --------------------- -------------- -------------------- --------------
  **Export Trade                                            
  Matrix**                                                  

  **Country:**          **Egypt**      Units:               MT

  **Commodity:**        **Oranges**                         

  **Time period:**                                          

  **Exports for**       **2002**                            **2003**

  U.S.                                 U.S.                 

  Others                               Others               

  Saudi Arabia          182,348        Saudi Arabia         130,978

  Other Arab Countries  67,846         Other \'Arab         65,763
                                       Countries            

  Russia                75,080         Russia               97,666

  Ukraine               26,409         Ukraine              44,179

  England               20,597         England              24,183

  E.U                   23,618         E.U                  35,122

  Malaysia              5,531          Malaysia             6,383

  HongKong              5,219          Lithuania            5,689

  Indonesia             3,783          Italy                4,405

  Malta                 3,752          Indonisia            3,707

  **Total for Others**  414183                              418075

  **Others not listed** 1,889                               1,925

  **Grand Total**       416072                              420000
  --------------------- -------------- -------------------- --------------

## Tangerines

  ----------------------- -------------- ------------- ------- ------------- ------- -------------
  **PSD Table**                                                                      

  **Country:**            **Egypt**                                                  

  **Commodity:**          **Fresh                                                    
                          Tangerines**                                               

                                         **2002**              **2003**              **2004**

                          Old            New           Old     New           Old     New

  **Market Year Begin**                  **10/2002**           **10/2003**           **10/2004**

  Area Planted            39             40            40      40            0       40

  Area Harvested          35             36            36      36            0       36

  Bearing Trees           2150           2249          2250    2252          0       2253

  Non-Bearing Trees       1040           1011          1012    1013          0       1012

  TOTAL No. Of Trees      3190           3260          3262    3265          0       3265

  Production              500            504           505     506           0       506

  Imports                 0              0             0       0             0       0

  **TOTAL SUPPLY**        500            **504**       505     **506**       0       **506**

  Exports                 5              4             5       3             0       2

  Fresh Dom. Consumption  492            495           498     498           0       498

  Processing              3              5             2       5             0       6

  **TOTAL DISTRIBUTION**  500            **504**       505     **506**       0       **506**
  ----------------------- -------------- ------------- ------- ------------- ------- -------------

# Production

The major variety of tangerines grown in Egypt is the mandarin, a local
"baladi" variety which is not a hybrid variety. Mandarins are mainly
produced for the local market with limited quantities for the export
market. In 2003/04, total tangerine production increased slightly to
506,000 MT, as compared to 504,000 MT in 2002/2003. This increase is
attributed mainly to the increase in the number of bearing trees in
addition to the absence of strong winds. The mandarin production season
is shorter than the orange season. The marketing season begins in
November/December but ends in February/March, about two months earlier
than the orange season.

## Consumption

Despite the predominance of orange production, many Egyptian consumers
prefer mandarins to oranges because they are easier to eat. During the
2003/04 marketing season (November-October), wholesale prices averaged
L.E. 0.90 per kg, and retail prices were around LE 1.30 per kg. In
2003/2004, total mandarin consumption increased to 503,000 MT compared
to 500,000 MT in 2002/2003.

# Trade

All mandarin exports are handled by the private sector. Mandarins do not
require a special cleaning or waxing process. The major export market
for Egyptian mandarins is the Gulf countries. In the 2003/2004 season,
total Egyptian mandarin exports decreased to approximately 3,000 MT,
compared to 4,000 MT exported in 2002/2003. The average export price for
mandarins in the 2003/2004 season was approximately \$250 per MT as
compared to \$257 per MT in the 2002/03 season at the same period of
time.

## Fresh Citrus, Other Stocks

  ----------------------- ---------------- ------------- ------- ------------- ------- -------------
  **PSD Table**                                                                        

  **Country:**            **Egypt**                                                    

  **Commodity:**          **Fresh                                                      
                          Citrus,Other**                                               

                                           **2002**              **2003**              **2004**

                          Old              New           Old     New           Old     New

  **Market Year Begin**                    **10/2002**           **10/2003**           **10/2004**

  Area Planted            18               18            19      19            0       19

  Area Harvested          16               17            17      17            0       17

  Bearing Trees           775              810           815     812           0       815

  Non-Bearing Trees       625              590           595     590           0       589

  TOTAL No. Of Trees      1400             1400          1410    1402          0       1404

  Production              355              370           372     372           0       373

  Imports                 0                0             0       0             0       0

  **TOTAL SUPPLY**        355              **370**       372     **372**       0       **373**

  Exports                 19               20            22      21            0       21

  Fresh Dom. Consumption  317              331           330     331           0       332

  Processing              19               19            20      20            0       20

  **TOTAL DISTRIBUTION**  355              **370**       372     **372**       0       **373**
  ----------------------- ---------------- ------------- ------- ------------- ------- -------------

# Production

Sweet and sour limes and bitter oranges are the major types of other
citrus produced in Egypt. Limes, known as "lamuun" in Arabic, account
for most of this category. Lime trees produce throughout the year, with
the greatest output occurring in the late summer months of September and
October. Egyptian consumers have a strong preference for limes. Fresh
sliced limes often are served with meals. A heavily sweetened, fresh
lime juice is also very popular, as are pickled limes which accompany
many dishes.

Most of the production of bitter orange is processed into jelly and
marmalade. Reliable statistical data on the production and marketing of
bitter oranges is not available.

Grapefruit is another citrus fruit that is not very popular in Egypt.
Most of the grapefruit grown are seedless varieties. The area currently
under cultivation is estimated at approximately 220 hectares**,** mainly
grown to service hotels, restaurants and other facilities that cater to
the tourist industry. Unless export demand increases, grapefruits are
not expected to become a significant citrus crop.