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A In
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Associadas
citrosucowww.citrosuco.com.br
citrovitawww.citrovita.com.br
cutralewww.cutrale.com.br
louis dreyfus commoditieswww.ldcommodities.com.br
Associates
citrosucowww.citrosuco.com.br
citrovitawww.citrovita.com.br
cutralewww.cutrale.com.br
louis dreyfus commoditieswww.ldcommodities.com.br
BrA
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A In
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BrA
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F or
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A I
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Br
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de
lAr
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Associadas
citrosucowww.citrosuco.com.br
citrovitawww.citrovita.com.br
cutralewww.cutrale.com.br
louis dreyfus commoditieswww.ldcommodities.com.br
Associates
citrosucowww.citrosuco.com.br
citrovitawww.citrovita.com.br
cutralewww.cutrale.com.br
louis dreyfus commoditieswww.ldcommodities.com.br
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1
From the oranges grown in Brazil, the world’s most
widely-consumed juice is produced.
Three out of every five glasses of OJ consumed on
the planet come from Brazilian fields.
CO
NTE
NTS
message from the President 5
history 6
Citrus Belt 10
12 Brazilian Citrus Belt
Planting and harvesting 16
19 An Orchard is Born
20 Planting Technology
21 Research and Development
23 Harvesting the Fruit
26 Labor Relations
27 An Orchard of Laws
the orange market 28
30 Ways to Sell Oranges
31 Pricing
ProCessing 32
35 Stages of Production
36 Production of Frozen Concentrate Orange Juice–FCOJ
37 Production of Not-from-Concentrate Orange Juice–NFC
logistiCs 40
43 The Journey of a Global Juice
44 Logistics and Distribution
ConsumPtion 48
50 World Consumption
53 Foreign Trade
sustainaBility 56
58 Orange Juice and Sustainability
62 A Modern, Humane and Sustainable Industry
64 Infographic on the Integrated Citrus Production Chain
glossary 68
Credits 69
CitrusBR
Brazilian Association
of Citrus Exporters
Rua Iguatemi 448 sl 701
01451-000 São Paulo SP Brasil
T +55 11 2769.1205
www.citrusbr.com
BRA
zIl
IAN
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STRy
Of
ORA
Ng
E ju
ICE
5
Brazil produces more than
50% of the world’s orange
juice, exports 98% of its
production, and accounts
for 85% of worldwide
orange juice exports.
Brazil is already a world leader in food production — the
result of hard work, scientific expertise, and a unique biome
that allows the nation to produce a great deal in a relatively
small area, thus preserving nature.
The leadership of the Brazilian citrus production is
recognized worldwide. CitrusBR – the Brazilian Association
of Citrus Exporters – is the representative body for Brazilian
producers and exporters of citrus juices.
Founded in 2009 by the companies Citrosuco–Fischer
Group, Cutrale, Citrovita–Votorantim Group, and Louis
Dreyfus Commodities, CitrusBR’s foremost objective is to
defend the collective interests of the sector, both nationally
and internationally, interacting with other entities in the
agribusiness, and promoting the consumption as well as
the image of Brazilian orange juice.
On the following pages, readers can understand the
complexity of the citrus production chain, from the orchard
to the worldwide consumer market.
Christian LohbauerExecutive President [email protected]
ORA
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THE
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’S f
AVO
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juI
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7
HIS
TORy
More than just a beverage, orange juice has been a friend of
humanity. At the time of the great explorations, this fruit became
a “poster girl” for the fight against scurvy, a disease affecting sailors
lacking sufficient vitamin C in their diet. According to researchers,
the orange’s fame as a source of good health dates back to this time.
Although oranges had been present in Brazil for four centuries, the
great transformation began in 1920, when the ‘citrus belt’ began
being structured in the hinterlands of São Paulo state. At that time
appeared the first outlines for a juice processing industry in the
environs of the city of Limeira. The first shipments of orange juice
were destined for Argentina, England and other European countries.
Gradually the region was consolidated as a major producer of
oranges in Brazil.
Today, the orange is making the opposite journey it made 400
years ago; instead of being brought to the Americas, the world’s
most widely–consumed juice is exported from the Americas to
destinations around the globe. Three out of every five glasses of OJ
consumed worldwide are produced in Brazil and — just like those
ancient caravels who braved the sea — modern vessels carry up to
1.2 million metric tons of juice to the most remote parts of the world
(in FCOJ Equivalent).
Photo from the 1930s, when the orange juice industry was
just getting started
This material is about an industry
whose history began more
than 40 years ago and today is responsible
for producing one of the tastiest, sustainable
and widely- consumed fruit juices ever
known. This is the world of Brazilian oranges.
Born in Asia and currently found in diverse
regions around the world, the orange
became one of the most globalized fruits
centuries ago. Originally from China, the
orange made its way westward across Asia
to Turkey, and continued on to Spain and
Portugal. From the Iberian peninsula it was
brought to the Americas, arriving in Brazil
over 400 years ago.
History of the orange in Brazil
1 1501
Portuguese explorers bring the first citrus trees from Spain
to Brazil for the purpose of creating supplies of vitamin C,
an antidote for scurvy. Adaptation of this fruit tree in Brazil
is so favorable that it’s even confused with native trees.
2 1873
Seedlings of Baía orange trees are shipped to
California (USA), from where this variety spreads
throughout the world. Baía oranges originated
in Brazil, most likely from a mutation of a select
variety.
3 1889
Favored by the proximity of the consumer
market and conditions such as climate, soil and
temperature, the citrus industry gains momentum
in the Center-South region of Brazil.
4 1927
The São Paulo state government creates the
Citrus-Farming Service, linked to the Agronomy
Institute of Campinas and the Luiz de Queiroz
School of Agriculture, University of São Paulo.
5 1939
World War II almost completely paralyzes Brazilian
exports of fresh oranges, which leads to an
oversupply of the fruit in Brazil. During this period,
production of orange juice using the ‘hotpack’
system begins, to fill orders for the British army.
6 1961
The citrus industry expands to the
regions of Araraquara and Bebedouro,
in the state of São Paulo.
7 1963
Brazil’s first factory of frozen
concentrate orange juice (FCOJ)
is established. In the first year of
operation, more than 6,000 metric
tons of juice are exported.
8 1970
Expansion of orchards in São
Paulo state, driven by the juice
industry and export incentives,
leads Brazil to occupy a
prominent position on the
international market.
9 1981
Innovation within the FCOJ shipping
system to replace traditional steel
drums with tanker trucks and bulk cargo
vessels, in addition to building company-
owned port terminals in 1985.
10
1984
Severe frost in the orange
groves of Florida ushers
in a phase of substantial
prosperity in the Brazilian
Citrus Industry.
11 2003
Innovation in the juice market
with the development of NFC
(Not-From-Concentrate) juice
and exportation of this product.
13 2010
More than 50% of all orange
juice consumed in the world
comes from Brazil.
12 2006
Price of orange juice on the international
market reaches record levels.
9
THE
ORA
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E IN
BRA
zIl The assertion that the orange found in Brazil the ideal
place to develop can be proven by the amplitude of the
harvest period. Between the months of May and January,
the fruit can be found being harvested in some region of
the nation. However, this does not mean that production
is homogeneous throughout the year; to the contrary:
between September and November there is a major
concentration of the fruit being delivered to juice industries.
Even considering that there is an amazing variety of
oranges around the world, eight species are predominant
in Brazil. In this regard, there are oranges picked earlier in
the year and those picked later in the year. Hamlin, Pera,
Valência and Pera-Natal are the most common juice
varieties, whereas the Baía and Lima varieties are typically
destined for fresh consumption.
Today, 55% of the plants grown in the orange groves in
São Paulo state are Natal, Valência and other late-harvest
varieties; 23% are Hamlin and other early-harvest varieties;
and 22% are Pera as well as other mid-season varieties.
With diversified varieties, Brazil can
have an orange harvest practically
every month of the year
From the oranges grown in Brazil, the world’s
most widely-consumed juice is produced.
Three out of five glasses of OJ consumed on
the planet come from Brazilian factories
The preference of citrus growers for late varieties — in virtue of
their higher productivity — has occurred to the detriment of the
mid-season varieties that are well accepted on the market for
fresh fruit, leading to a shortfall of the fruit, mainly in September,
and consequently greater competition between the industry
and fresh fruit market during this period.
In addition to being widely accepted on the fresh fruit market,
the Pera variety has a higher content of soluble solids, which
are simply the sugars that comprise the raw material for juice
concentrate. These two factors, coupled with the production
deficit just at the time that Pera oranges are producing, cause this
variety to bring higher prices than the other varieties destined to
the juice industry.
Aiming to reduce the period of shortfall, growers are changing
the profile of their orchards by increasing early-harvest trees
and reducing late-harvest trees. In orchards with trees aged 0
to 2 years, early varieties represent 23%; mid-season varieties
represent 22% of the total harvest; leaving the late-harvest
varieties with a 53% share.
The planting of different varieties is also a way to manage disease
control and reduce the impacts of climatic adversities. The
improvement of citrus varieties is being done with traditional
improvement techniques.
In the citrus belt — an area covering 300 counties between
São Paulo and Minas Gerais in southeastern Brazil — there
are several research institutes devoted to the orange, which
seek solutions for preventing and fighting diseases as well as
improving the quality of the fruit.Source: Prepared by Markestrat based on CitrusBR
Harvesting period by orange variety and % of production
Early-season (hamlin, westin, rubi, pineapple) Mid-season (pera) Late season (valência and natal)
may jun jul aug sep oct nov dec jan feb mar apr
23%
22%
55%
11
Seven reasons that make São Paulo the most
important citrus-producing region in Brazil:
1. Suitable soil
2. Available water
3. Adequate rainfall
4. Topography
5. Available and qualified labor force
6. Availability of inputs
7. Local infrastructure
CIT
RuS
BElT
13
Brazil’s Citrus Belt is located amidst the well-maintained
highways in the state of São Paulo and covers 375
counties, many of which are surrounded by sugarcane
fields. Distributed into five major regions across an
area of 1.3 million hectares, orange farming is the third
most important agricultural activity in the state, behind
sugarcane and livestock.
the region accounts for more than 80% of Brazil’s
orange production.
Within the state, the strength in relative terms is even
greater; of all the oranges produced in São Paulo, 93%
come from the citrus belt. This geographic distribution
of production revolves around a structured industrial
complex, with four major industries that have 14 factories
in 11 cities, in addition to other smaller factories.
Historically, Northern São Paulo state has been the most
important region for fruit production, particularly in cities
such as Matão and Bebedouro. However, due to diseases
such as greening and significant changes in rainfall
patterns, the citrus industry in the southern part of São
Paulo state has grown exponentially.
The citrus belt is divided into five macro-regions: Central,
South, North, Northwest, and Castelo. Even so, the
climate has great influence on the vigor and longevity
of citrus trees, as well as the quality and quantity of fruit.
Orange trees (as other citrus plants) are best adapted to
climates with temperatures ranging from 23°C to 32°C
with high relative humidity.
CIT
RuS
BElT
NORTH 25,81 million trees
BRAzIl
SãO PAulO
CENTRAl 76,28 million trees
SOuTH 30,66 million trees
CASTElO 41,57 million trees
Orange farming employs over 200,000 workers in direct and indirect occupations.
The fruit is harvested at the right stage of ripeness, for the juice to meet the same standard of quality.
Truck loaded with fruit on a farm in São Paulo. Total area of orange groves in the citrus belt reaches 600,000 hectares, and orange is the third most important agricultural activity in the state.
The orange groves coexist in harmony with the legal reservations (areas destined for the preservation of local fauna and flora). Brazilian legislation is very strict, and every producer must leave an area of 20% of native woodlands preserved.
The Citrus Belt is an area covering over
300 counties in Southeastern Brazil —
the largest concentra-tion of orange groves
in the world.
Number of trees in regions of the Brazilian Citrus Belt
in the 2009/10 harvest, 165 million trees produced 397 million boxes of oranges,
in an area of only 1.2% of Brazil’s overall croplands.
NORTHWEST 30,35 million trees
Source: “O Retrato da Citricultura Brasileira”, 2010
15
Today there are about
165 million orange trees that produce
nearly 400 million boxes of oranges a year.
Orange production in the citrus belt, as well as its destinations,
have been changing over time. Production has fallen around
11% over the last 15 years. When analyzing the behavior
of production distribution over the same period, there has
been a clear increase in production destined to industry and,
consequently, a reduction in production destined to the market
for fresh fruit.
Production destined to industry rose from 76% of the Citrus
Belt’s overall production in 1995 to 86% in 2009, i.e., a growth
of 10%, unlike the case with the fruit destined for fresh
consumption, which accounted 24% in 1995 and fell to 14% in
2009, a reduction of 10%.
858
982
1.051 1.006
960
1.001
8541.024
644
653577
783
732817
1,096 1,098 1,340 1,324 1,089 895 1,430 1,072 1,369 1,165 1,369 1,363 1,1331,153
2,4212,328
2,781
2,332
2,814
2,422
2,664
2,236 2,225
2,441
2,626
2,282
2,019
2,433
2,441
São Paulo and Triângulo Mineiro production Florida production
1995/96 1996/97 1997/98 1998/99 1999/10 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09
563
1,065
2009/10
3,000
2,500
2,000
1,500
1,000
500
0
World production
Major producers of orange
Evolution of world production of orange juice
2009-2010 season
florida and são Paulo account for 81% of orange juice production worldwide.
the state of são Paulo alone accounts for 53% of the total.
Source: “O Retrato da Citricultura Brasileira, 2010”
25,0% Other
3,3% Iran3,4% Indonesia
4,9% Spain
5,1% Egypt
6,0% Mexico
6,4% India
8,7% China
12,1% united States
25,2% Brazil
land use in BrazilHectares x 1000
Brazil - Total area
Overall croplands
Orange crops
Sugarcane crops
Coffee crops
Soy crops
Hectares x 1000
851,487
67,660
837
8,140
2,170
21,057
% of total
-
7.9%
0.1%
1.0%
0.3%
2.5%
% of overall cropland
-
-
1.2%
12.0%
3.2%
31.1%
Sources: USDA, FAO, IBGE, CONAB, CitrusBR
17
More than plants and fruits, this sector is a genuine machine for producing new technologies to attain the highest standards of quality
Nearly 165 million trees in Brazil
Average of 850 trees per hectare
230% is the increase in the density of orchards praticed in 1980
39% is the increase in productivity from 1995 to 2008Pl
AN
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19
1. Seeds are handled to farms, where they will be planted to start producing 3 years later
2. Greenhouses are used so the seedlings receive the best care while they’re still young
3. Worker caring for the plant before it reaches the point of being taken to an orchard, when its productive life will begin
4. Adults orchards form huge oranges mazes, where millions of boxes will be harvested
Since the mid-1990s, a structural change has been taking
place in Brazil’s croplands. With the advance of new production
technologies and enhancement of management tools, there has
been a notable shift in the distribution of the orchards.
Today, out of all the oranges supplied to industry, around 65%
of production for juice comes from slightly more than 5% of the
growers, which shows a huge concentration in the supply of
oranges. The industries, in turn, own roughly 35% of the orchards.
The average life span of the orange trees is around 20 years,
which demonstrates the need for long-term planning. Anyone
getting into the orange market cannot think of it as a short-term
business opportunity, especially because the return on investment
only begins after the third year of a tree’s life cycle, when the first
fruits appear. That’s not counting the nearly two years (on average)
required for the overall planning of the business. This means that
the return only comes several years later.
Still, orange growing has presented itself as a good deal for more
specialized producers who work in economy of scale.
Compared to the orchards of the past, there is a major difference in
relation to what was done just 20 years ago, when the number of
trees was around 250 trees per hectare.
The main change is in the production technology itself. Currently,
there is a much higher number of trees per hectare, reaching more
than 800 trees per hectare (an increase of 230%), which reflects
the productivity of a farm. This is because, on average, one tree
produces two 40.8-kg boxes.
AN
ORC
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Technology developed in Brazilian orange chain helps boost the income of growers and industry
1 2 3 4
21
In 1980, a grower could produce 500 boxes per
hectare. Today, these figures can reach over 1,600
boxes per hectare.
In a quick calculation, considering the spot
market prices prevailing in Brazil of US$8.80
per box in the 2009/2010 growing season,
this means that a grower with 250 boxes will
receive revenues of US$2,200 per hectare, while
a grower whose orchard is denser will each
US$7,400 in the same area. In terms of income,
there is an increase of 233% just by raising the
number of trees per hectare.
Irrigation is another technology that has been
gaining ground in Brazilian orchards, particularly
in the drier areas of São Paulo state.
In citrus farming, there is the possibility of
adopting different systems, but on average, the
water requirement of citrus trees varies from 900
to 1200 mm of water per year. Demand for water
is high during periods of sprouting, blossoming,
fruit set and early fruit development, and lower in
periods of ripening, harvesting and rest periods.
Currently around 15% of São Paulo orchards are
irrigated. However, the need for water compared
to other crops such as soybeans, corn and coffee,
make orange a low water consumption crop,
basically using what is known as “rescue irrigation.”
PlA
NTI
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TEC
HN
OlO
gy
RESE
ARC
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Nd
dEV
ElO
PMEN
T Brazil has a long tradition of
solving problems and finding
new technologies
3. Trained technicians look for imperfections and diseases all the time
Many advances in worldwide citrus production
were born in Brazilian orchards. Control of citrus
canker, for example, is the result of Brazilian
research that helped the world to rid its orange
groves of this terrible disease. Today, most efforts
are geared toward a cure for a cure for a disease
named greening.
Several research centers are working to
develop new varieties of fruit, as well as new
production technologies and ways to prevent
and fight diseases.
The Citrus Defense Fund (Fundecitrus), the
Sylvio Moreira APTA Citrus Center, the Luis de
Queiroz College of Agriculture, associated with
the University of São Paulo, and the Campinas
Agronomic Institute, of the São Paulo state
government, are references in research and
development for new technologies.
The orange juice processing and exporting
industry is a partner in many projects, financially
collaborating with research efforts, or even using
orchards as laboratories for new discoveries. The
challenges for the coming years have already
been defined. Among them, fighting the most
relevant diseases, increasing productivity of the
orchards, and bringing income to orange growers,
key partners of the industry. Maintaining citrus
farming as one of the most profitable agricultural
activities per hectare, as well as its high levels of
sustainability, are also among the challenges for
the future that started more than 40 years ago.
1. The work force to tend the plants receives specialized training
3. The life of an orange tree begins in small trays, with specially planted substrates
1. Plant nurseries specializing in seedlings are an important part of the business
2. Proper plant treatment is important to lead the plant smoothly into adulthood, when it is transplanted in an orchard
2. After reaching the adult phase, the plant blooms vigorously, producing spectacular fruits
23
The orange harvest is a combination of manual and mechanical work, and the pickers play a key role in the process
HA
RVES
TIN
g T
HE
fRuI
T In Brazil, due to climatic and soil conditions, there are
orange harvests practically all year round. Harvesting
is done manually. In its entire production chain, the
sector employs over 200,000 workers, generating a
payroll of more than US$600 million per year.
Occupational safety is a major concern of the orange
juice processing and exporting industries. Brazil has
some of the strictest labor laws in the world, and
supporting workers is fundamental to the success of
this sector.
Currently, juice industries own 35% of the orchards
producing juice oranges, of which 100% of the
manpower is strictly regulated by law. There is no
child labor or any type of exploitation whatsoever, and
the sector is constantly watched by the competent
authorities, such as the Public Prosecutors, assuring
compliance with the law.
The other 65% of production is in the hands of
small-scale, medium-sale and, primarily, large-
scale producers. In these orchards, the company’s
relationship with employees is constantly overseen by
Brazilian authorities, whose fight against distortions in
labor relations has contributed to significant advances
in the entire productive chain.
In light of all these facts, consumers of Brazilian orange
juice can rest assured that this is a food product made
within the strictest technological and social standards,
generating and distributing wealth both within and
outside Brazil.
JAN
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MAYJUN JUL
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NOVDEC
JAN
FEBM
AR
APR
MAYJUN JUL
AUG
SEPO
CT
NOVDEC
Harvesting and processingMay to February
SãO PAULOBRAzIL
FLORIDAUSA
Harvesting and processingOctober to May
Harvest year
July to June
Harvest yearOctober to September
JAN
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JAN
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MAYJUN JUL
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27
In many countries around the planet, there are severe differences
between labor laws applied in cities and in rural areas. But not in
Brazil, which in 2005 implemented what is known as Normative
Instruction 31 (NI 31), ushering in a series of new rules so that
workers in the countryside would receive the same treatment as
workers in cities and industries.
When a glass of orange juice produced in Brazil is served anywhere
in the world, a set of social rules is served along with it. Not only
the taxes and social contributions that will guarantee retirement
benefits for the workers, but strict standards of health and safety
and the innumerous rules established in NI 31 travel the world
together with the beverage.
For Brazil’s orange juice processing and exporting industry, nothing
is more important than assuring that this beloved beverage is
produced in accordance with the strictest ethical standards, such a
relevant issue to increasingly demanding consumers.
With a total of more than 200,000 workers directly or indirectly
involved with the orange juice processing and exporting industry,
there is always a weakest link that must be protected. The orange
pickers currently enjoy advanced working conditions compared to
many countries, even in sectors unrelated to farming.
lABO
R RE
lATI
ON
S
Labor relations in Brazil comply with strict criteria,
assuring the best labor practices on the market
Citrus farming generates a
contingent of more than 200,000
jobs directly and indirectly
AN
ORC
HA
Rd
Of
lAW
SPersonal protective equipment has undergone
major adjustments in recent years. The clothing,
designed for comfort even in the warmest tropical
regions of Brazil, protects from the effects of sunlight.
Sunglasses are also part of the equipment, as well
as gloves and boots that offer protection against
different types of accidents.
The regulations governing farm work were developed
by a tripartite committee with the presence of the
National Confederation of Rural Workers, the National
Confederation of Agriculture, and the Ministry of
Labor and Employment. The standards developed
consensually between employers and employees
were ratified by the Labor Ministry. However, the
content of those standards for which no consensus
could be reached was arbitrated, which in a certain
way transferred to the countryside many of the
standards required in urban work.
If on one hand this represented an advance for the
sector, on the other hand there was an increase in
the cost of operations, which decreases margins
and requires a great deal of skill to comply with rules
designed for urban environments and that require
adaptations not provided for in the legal code.
Still, the orange juice processing and exporting
industry believes that only socially responsible
products have a place on the world market,
something it has been fulfilling for over 40 years, in
one of Brazil’s most traditional industries.
In the 2009/10 harvest, Brazilian
production totaled 397 million
40.8-Kg boxes
Use of Personal Protective Equipment (PPE) is mandatory.
Workers are required by law to wear safety equipment, provided by the employer.
29
Trucks loaded with oranges make the journey from farm to factory, thousands of times in hundreds of municipalities. Logistics is a key part of the chain.
THE
ORA
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31
The coming and going of fruit: The delivery of oranges for
processing is a ritual that takes place between April and
December. However, there is a heavy concentration from
September to November, when the majority of the crop reaches
ripeness. The sale of fruit occurs at the factory gate and growers
can choose not only the company they want to sell their fruit to,
but also the type of contract that best meets their needs.
Among the most commonly used types of contract, there are
two major groups: sale on the spot market, whereby growers
receive the quote of the day for their fruit; and medium- and
long-term contracts, in which growers may choose minimum
and maximum price variables depending on their marketing
strategy. Then there are those fruit suppliers that make both
types of bargaining: they lock their costs with medium- and
long-term contracts and use the spot market as a way to wager
on the market.
Each type of contract offers risks and rewards. In the harvests of
2007/2008 and 2008/2009, producers with long-term contracts
were benefitted more than those who chose the spot market.
However, in the 2009/2010 harvest, those who opted to sell
oranges in the spot market earned more money. There is no
perfect model, and each farmer must study the pros and cons
of each model and choose the strategy that will bring in the
most income.
THE
ORA
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ES M
ARK
ET
PRIC
INgAs in other commodities, the orange market is influenced by supply and
demand. However, it’s not only consumption that determines the pricing, since
there have been no major changes in volumes exported by Brazil in nearly a
decade. The main factor that determines the price of a box of oranges (and
consequently orange juice) is the supply of fruit, influenced by the world’s two
major citrus-growing regions: São Paulo (Brazil) and Florida (USA).
As shown in the graph below, the ups and downs both in oranges by the box
and orange juice quotes in New York are directly tied to climatic effects that
impact the supply of the fruit.
The price that the industry pays for oranges is a result of current and future
international juice prices, as well as market expectations regarding future
supply and demand of oranges at the time that each orange purchase
contract is negotiated.
Another factor to be considered in competitiveness is the import tariffs paid
in the United States and Europe for entry of Brazilian orange juice, plus the
logistics and port costs incurred on the Brazilian product to be shipped to
these destinations.
Example of Contract Types:n Long-term contracts with fixed predetermined prices;
n Long-term contracts with or without a guaranteed minimum price and with price triggers indexed to the audited averages, obtained from the selling prices from the industries to bottlers;
n Long-term contracts with or without guaranteed minimum price directly linked to daily quotes and annual averages of the price of the commodity on the New York Stock Exchange;
n Orange purchase contracts during the harvest at the price of the day, known as the spot market;
n Long-term lease or sharecropping contracts.
destination of orange production in the brazilian citrus belt
14%Fresh fruit for consumption
86%Available for industry
Source: “O Retrato da Citricultura Brasileira”, 2010. Prepared by Markestrat based on CitrusBR data.
from the total volume available to industry
15%Used for
NFC
85%Used for FCOJ
Comparative analysis of production and consumption of orange juice at 66° brix equivalent and the price of fCOj on the New york Stock Exchange
Production demand Quotation - NySE
2.700
2.600
2.500
2.400
2.300
2.200
2.100
2.000
1.900 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10
Prod
ucti
on a
nd C
onsu
mpt
ion
of O
rang
e Ju
ice
in t
hous
ands
of
met
ric t
ons
in v
alue
s eq
uiva
lent
to
66° b
rix
$ 190
$ 170
$ 150
$ 130
$ 110
$ 90
$ 70
$ 50
2008/09 e 2009/10Two consecutive smaller harvests in Brazil and Florida reduce global
inventories of juice and raise the stock quotes staring in mid-2009.
2003/04Very high inventories of juice due to good harvests in Brazil and Florida keep prices low on the New York Stock Exchange.
2004/05 e 2005/06Successive hurricanes in Florida decrease the juice production in the region raising NYSE quotes to record highs. 2006/07 e 2007/08
A combination of good crops in Brazil and Florida, plus the drop in demand for juice following the trend started in 2004/05, raise world inventories too high, pressuring the stock quotes for heavy losses in the 2008/09 season
$ 66.95
$ 83.91
$ 124.30
$ 180.83
$ 127.92
$ 85.74
$ 122.55
33
PRO
CES
SIN
gThe factories are equipped to receive hundreds of trucks per day.Once unloaded, the fruits are immediately stored, starting the process of extraction and industrialization of the orange juice.
35
On the following pages, you can learn a little about the Brazilian
industry, responsible for producing the most widely-consumed
juice in the world. This is a large-scale process, which makes
use of modern production technology combined with one of
the planet’s best environments for producing this fruit.
The quality of the beverage is also tested with regard to
contaminants, taste and aroma. This allows a constant quality
standard, always maintaining the same characteristics.PR
OC
ESSI
Ng
On average, only 25% of the water used by industries comes from outside sources; the rest comes from the process of concentrating the juice.
Modern and Sustainable Industry: the Brazilian citrus industry is a pioneer in good agricultural and industrial practices.
1. Receiving the fruit fruit samples are taken from each truck for analysis of juice yield, Brix, acidity and color.
2. Storage in binsafter receipt and inspection, the oranges
are stored in bins, or storage silos.
3. Washing of the fruitsthe oranges pass over wash tables, where there are spray nozzles on the top and plastic brushes on the bottom to clean the fruit mechanically, with or without the aid of detergents.
4. Selection and classificationThe oranges are chosen by operators on selection tables. Damaged and bruised fruit are removed and
the others go to the classifiers that separate them by size and are then sent to the extraction lines.
5. Extraction the fruits are separated according to their size so they can be processed by lines of extractors appropriate for the size of the fruit, where the juice is extracted mechanically.
6. Blending and Homogenization After extraction and concentration, the juice
is technically rated according to appearance and flavor that are ideal for export.
37
The major star of this market, concentrate juice is the main
reason for the success of this beverage around the world.
Much of the water is removed from the product within the
evaporators. This process inactivates the microorganisms that
are responsible for degradation of the liquid.
After the separation process, the juice goes to an evaporator,
specially developed for the citrus industry, where the volatile
components are separated and then recovered.
After this first stage, a product that came in with total sugar
levels (soluble solids) of 10-11 Brix comes out with a content
of 66 or 65 Brix — the standard for FCOJ.
In the concentration process, the juice loses a volatile fraction
in which the essences are found.
The recovered components are the essences, in aqueous
and oily phases, which are sold to companies that produce
aromas and fragrances. In some cases, the juice goes through
a process of homogenization, reducing its viscosity in order to
optimize evaporation.
The concentrate juice is cooled and blended with other
quantities of the same product to reach an acceptable standard
of quality. Then it goes to storage tanks refrigerated to freezing
temperature, where it can be stored for a period of up to
two years.
The bulk storage system is called a ‘tank farm’ in the business.
In these tanks, the juice is stored until transported by tank
trucks to the port.
CO
NC
ENTR
ATE
juIC
E
NO
T-fR
OM
-CO
NC
ENTR
ATE
juIC
EIn the mid-2000s, something new began to arrive at European
port terminals. A kind of orange juice with characteristics
somewhat different from traditional concentrate juice, namely:
not-from-concentrate (NFC) — or simply ready-to-drink juice.
Instead of having the water extracted during processing and
then reconstituted after being purchased by the bottlers, this
drink is pasteurized with the water from the orange itself.
It is a superior product in terms of taste, since it resembles
freshly squeezed juice, a privilege that few countries can have.
The final product is stored for up to one year, frozen or chilled.
Because not-from-concentrate juice occupies a volume 5 to
6 times larger than concentrate, the cost of storing it chilled
is high. Therefore, its storage and distribution chain is aseptic.
Another difference of NFC compared to FCOJ is that it
becomes solid when frozen, preventing the juice from being
pumped. Therefore, for small amounts exported, not-from-
concentrate juice is packaged in drums, which means a higher
cost compared to bulk sales. For large amounts of NFC juice,
storage is usually done in aseptic tanks with a capacity of up
to 4 million liters.
The juice must be stirred periodically to prevent the separation
of the juice and dissolved solids and to maintain uniformity of
Brix. In Brazil, where most of the juice is destined for export,
the aseptic tanks are installed at port terminals and not at the
factories. To prevent re-pasteurization of juice before shipping,
technologies were developed to allow transport in ships
specially designed for this purpose.
39
ON
E fR
uIT,
M
AN
y PR
Od
uC
TS
The business involving oranges goes beyond concentrate and
not-from-concentrate juices. There is a thriving market for orange
byproducts — accounting for about 7.5% of the business.
There are three major groups of byproducts: terpenes — responsible
for the manufacture of some types of biodegradable resins and
solvents; essential oils — from wich aromas and fragrances are
derived; and finally the bagasse/pomace — which can be made into
animal feed, among other uses.
After separation of the juice and the pulp, the latter still goes through
a process where unwanted components are removed, such as the
bagasse and the seeds. The “clean” pulp is sent to equipment where
there is a new process of pasteurization, or heat treatment, and then
frozen before being sent to storage.
If the pulp remaining after juice extraction is not used for commercial
purposes, it can be washed to extract substances dissolved in the
juice. This product is called pulp wash, and can (if legislation permits)
be mixed with juice on the production line, prior to the concentration
process.
The emulsion of oil and water coming from the juice extracting
process also has other substances, such as particles of peel and pulp,
pectins and sugars. The objective is to recover the oil from the peel by
removing the other substances and losing as little oil as possible in this
process, which occurs through two stages of centrifugation.
It’s economically advisable to include a system of pressing and drying
of the orange peel and solid residues in large juice processing plants.
The fruits rejected upon receipt, the peel and bagasse resulting from
the extraction process, as well as the pulp and other solids, are sent to
the dryer, where they are dried and pelletized to serve as a fibrous feed
for livestock.
Orange and Orange juice By-Products from every 1000 kg of oranges, 553 kg of juice are extracted, the rest are by-products:
% of juice in different types of beverages:
Orange juice can be sold to the end consumer in three different ways:
Concentrate
partially dehydrated, from which part of
the natural water was removed.
integral
no added sugar and at its natural
concentration.
reconstituted
made from juice concentrate,
with water added. Must meet the same quality
parameters as the integral juice.
Fonte: The Orange Book, Tetrapak
Juice553 kg1000 kg
Pulp 30 kg essence aroma 1,1 kg
essence oil 0,1 kg
Peel oil 3 kg
65º Brix Concentrate 100 kg
Peel, bagasse and seeds 413 kg evaporated water 452 kg
Parts of the orange
seed
oil segment
juice segment
flavedo
central core
albedo
segment wall
utilization of the Orange
0.5% aqueous phase
0.1% oil phase
2.7% sacs
0.9% d-limonene
1.8% essential oils
44.8% orange juice
49.2% peel, seeds and bagasse
Juice
100% pure juice,
extracted from the fruit
nectar
25% to 99% of juice,
depending on the
specific legislation
non-carbonated
soft drink
less than 25% of juice;
in many countries, only
3 to 5% juice
41
From the factories to the most distant places,
Brazilian orange juice is shipped largely by
producer industries with high-tech storage
methods — chilled for concentrate and
aseptic for NFC — which are specialized in this
extremely complex logistical process.
Tankers specially designed for shipping orange
juice leave the Port of Santos, in Brazil,
loaded with thousands of tons of concentrate
orange juice and NFC.
This is a complex operation, where the beverage
is transported from the factories to the tanker
trucks into the bulk juice terminals at the Port
of Santos, and pumped onto the orange juice
tank ships, with no contact with the outside
environment.
Each exporting company owns or charters
terminals and vessels in Brazil, Europe and the
US — the primary destinations of Brazilian
orange juice. But Brazilian orange juice also
reaches more distant destinations such as
China and the Middle East. lOg
ISTI
CS
43THE
jOu
RNEy
Of
A g
lOBA
l ju
ICE A ship can carry up to 40,000 metric tons of orange
juice concentrate, leaving from the Port of Santos
in São Paulo — the cradle of Brazilian citrus. On the
journey ahead, it has to brave the Atlantic or Pacific
Ocean until it can unload the precious drink at far-away
terminals in Europe, United States, Asia, and Oceania.
From the time it’s produced until the time it reaches
the bottlers that carry out the blending and sell the
beverage on the retail market, there is no contact
whatsoever between the product and the outside
environment, which also makes the orange juice
producing industry a logistics industry as well.
Transportation of this product is usually done in tank
trucks or tank ships in chilled drums. A small portion
is packed in aseptic bags that are placed in drums for
subsequent transport in refrigerated containers.
The largest Brazilian processors have their own
terminals in Brazil, Europe, United States, Japan
and Australia, and there are many ships designed
exclusively for transporting frozen concentrate orange
juice and other bulk citrus products.
There are two ways to transport not-from-concentrate
juice: frozen or chilled. Both are done under aseptic
conditions. The problem of transporting NFC frozen
is that, unlike concentrate (which even when frozen
remains viscous and is still “pumpable”), not-from-
concentrate juice (NFC) turns into a block of ice,
therefore must be shipped in refrigerated containers,
requiring differentiated logistics.
The capacity of an orange juice ship is
up to 40,000 metric tons
4545
Refrigerated vessel transporting orange juice
Vessel loading without contact with external environment
Non-stop: every 10 minutes, 365 days a year, a juice truck travels down the ‘Serra do Mar’ coastal mountain range
Thermally insulated truck leaves the factory
Truck in its way to the Port of Santos
lOg
ISTI
CS
AN
d
dIS
TRIB
uTI
ON The expansion of NFC juice production in Brazil in late 1990s led
to the development of bulk maritime shipping of chilled juice.
The most common method is to use one-ton bags, transported
in recipients placed inside refrigerated containers.
The shipping of concentrate and not-from-concentrate juice to
other continents has been improved through heavy investments
in new technologies developed by the major juice producers.
Nowadays, the use of company-owned vessels for shipping
juice reduces costs and assures that the quality of the juice is
maintained until reaching its destination.
In large European ports such as Rotterdam in the Netherlands
as well as Ghent and Antwerp in Belgium, there are exclusive
terminals for receiving bulk orange juice concentrate. This type
of terminal is also found in Florida and New Jersey, United States,
the port of Toyohashi, Japan, and the port of Newcastle, Australia.
Transportation of orange juice from the factory to the bottlers
INd
uST
RIA
l PR
OC
ESSI
Ng
fCOj
frozen tank truck frozen tank truckfrozen terminal frozen terminalTank ship
Chilled tank truck Chilled tank truck Blending housefrozen/chilled terminal frozen/chilled terminal
Tank ship
frozen/chilled tank truck frozen/chilled tank truckfrozen terminal frozen terminalTank ship
fCOj/NfC
NfC
BEV
ERA
gE
PRO
du
CER
SBO
TTlE
RS
From the tanker vessel, the product is pumped into receiving
lines that feed tanks located on the mainland. From these tanks,
the product is sent to blending stations, where different types
of concentrates are blended to achieve a product that meets
consumer demands.
In this stage, other ingredients may be added, and then the juice
is pumped into tanker trucks that will distribute it.
In the case of not-from-concentrate juice, there are also specific
terminals for receiving and unloading this product. Before the
ships are unloaded, samples are taken from the inner tanks
to confirm that the juice is microbiologically acceptable. The
pipping system is sterilized and the juice is transferred from the
vessels to storage tanks at the port. Pasteurization equipment is
located in the juice receiving area, if required.
47
49
Brazilian orange juice is one of the most
widely consumed beverages in the
world. It has 34% market share in the
juice category. Among all beverages,
Brazilian orange juice has a 0.91% global
market share.
But with each passing day, people are
decreasing their consumption of this
longtime favorite beverage, and global
consumption is dropping at a rate of
1.6% a year.glO
BAl
CO
NSu
MPT
ION
51
With a 34% of juice market share, orange juice and orange-
flavored drinks are the most widely consumed beverages
in the world. Among all the options on the market, these
drinks account for 0.91% of the global market. This is a
leadership achieved through a variety of factors ranging
from a universally accepted flavor to the possibility of
supplying different markets in the world frequently.
But the latest news is not so good. In the last decade,
consumption has been falling at a rate of 1.6% a year. In
the U.S. — responsible for the consumption of 38% of
all juice in the world — the demand for orange juice has
fallen nearly 25% in the last decade. The reasons for this
reversal are directly linked to the growth of other drinks
that have been taking away its market share. In recent
years, bottled waters are the fastest growing beverages.
The juice category is growing too, however orange juice
has been losing market share. One of the major factors is
the entry of new beverages such as multivitamin drinks
and the expansion of grape and apple flavors.
In China, whose sizeable population always stands out
as a potential market, certain consumer habits have
curbed the growth of orange juice. This reality implies
a major challenge for orange juice producers, who can
already see the need to reposition their product on the
world market.
Another challenge is to get around the Chinese
competition. A major producer of apples, China has
supplied raw material for manufacturing various types
of juice from this fruit, whose flavor is also among the
favorites among European consumers and offers tough
competition with the orange.
Another important point is the cultural habits of developing
countries located in the Middle East and Asia. These
populations do not have the habit of consuming 100% pure
juice. Non-carbonated soft drinks and nectars are more
common, which impacts sales because they contain only a
certain percentage of juice. The solution, therefore, is to make
Europeans and Americans drink or resume drinking more
orange juice — a difficult task, but doable.
Taking into account the 40 countries that are the top buyers
of orange juice from Brazil, representing 99% of world
consumption of orange flavor, a detailed analysis shows glO
BAl
CO
NSu
MPT
ION
Evolution of the global beverage market
Source: “O Retrato da Citricultura Brasileira”, 2010. Prepared by Markestrat based on Euromonitor data.
billions of liters
Milk-based beverages
Others
Hot coffee
Hot tea
Wine
Beer
Water
Carbonated beverages
Non-carbonated
soft drinks
juices and nectars
flavored milk
White milk
20092003 2005 2006 20082004 2007
12.8%
1,567
4.0%
7.1%
8.2%
20.9%
11.2%
15.3%
12.5%
2.7%2.6%
3.3%
6.7%
9.0%
20.4%
11.2%
12.8%
14.0%
14.8%
2.2%2.8%
1,2703.5%
6.8%
8.6%
20.6%
11.1%
13.7%
13.5%
2.3%2.8%
14.1%
1,3663.9%
7.0%
8.2%
20.6%
11.5%
14.6%
13.1%
2.5%2.7%
13.3%
1,488
3.9%
7.1%
8.1%
20.6%
11.4%
15.0%
12.9%
2.6%2.7%
13.8%
1,524
3.7%
6.9%
8.4%
20.6%
11.4%
15.3%
13.3%
2.2%2.8%
13.7%
1,428
3.5%
6.8%
8.8%
20.5%
11.1%
13.2%
13.8%
2.2%2.8%
14.5%
1,310
53
that the 63.5 billion liters consumed of ready-to-drink
fruit beverages, 20.4 billion were orange flavor and 7.5
billion were apple flavor. However, in the period from
2003 to 2009, in the juice category, there was a greater
diversification of flavors consumed, with a reduction in
annual demand for orange and apple flavors of 1.6%
and 2.3%, respectively, and an increase in demand
for tomato and multifruit flavors of 2.6% and 1.3%,
respectively. In the case of nectars and non-carbonated
soft drinks, the volume of orange flavor increased, but
to a lesser extent when compared to peach, grape,
mango and multifruit flavors.
This diversification in flavors consumed and the orange
flavor’s consequent loss of market share has contributed
to the reduction in worldwide demand for orange juice,
which has experienced a decline of 1.6% a year. The
situation is even worse in the major orange juice markets
— U.S. and Germany — which between 2003 and 2009
registered a decreased of 15% and 26% (respectively) in
the consumption of orange juice (in FCOJ equivalent).
Such behavior is not what one would expect when
analyzing the main demographic data from the 40
countries that together represent 99% of the world’s
demand for orange flavor. Unlike the consumption of
orange juice, which fell 6% in the period, the demographic
indices showed growth: the population increased by 5%,
total GDP by 51%, per capita GDP by 43%, and per capita
net income by 40%.
fORE
IgN
TRA
dESince the 1980s, Brazil has been the largest producer and
exporter of industrialized orange juice, producing over 50% of
the worldwide volume and exporting 98% of its production.
Roughly 85% of the orange juice exported worldwide comes
from Brazil. In no other sector does Brazil have such an isolated
leadership position.
Both frozen concentrate orange juice (FCOJ) and not-from-
concentrate juice (NFC) are exported. In order to develop
technologies that would allow exportation of large bulk
quantities over thousands of miles without losing quality, it took
years of research and investments in infrastructure and logistics.
The main consumer markets of concentrate juice are: Europe,
which imports around 70% of Brazilian juice, and the United
States, which imports about 13%. The rest is divided among
other countries, most notably Japan and China. Among the
factors that limit greater diversification of imports are per-capita
income, logistics and, primarily, consumer habits. In some
countries the preference is for nectars and non-carbonated soft
drinks, both products with low amounts of juice.
Despite its global leadership, Brazilian orange juice faces
various trade barriers that reduce its competitiveness on the
international market.
Moreover, Brazilian juice must meet a series of technical
requirements involving phytosanitary issues, packaging,
consistency in product quality, regularity of delivery, compliance
with the Codex Alimentarius, and compliance with general and
local laws for marketing food products, among others.
26%
North America
74%Europe
destinations of brazilian NfC in the 2000s
Sources: Elaborated by Markestrat based on data from Cacex, Banco do Brasil, Siscomex & SECEX/MIDC.
* Other: Liqueur, Tea, coffee-based drinks, energy drinks, concentrate or powdered fruit-flavored drinks.Source: O Retrato da Citricultura Brasileira. Elaborated by Markestrat based on data from Euromonitor.
World beverage consumption1,567 bio liters (2009)
2.7%Fruit-based beverages
2.6%Juices and nectars
0.9%Flavored
milk
ShArE OF
CONSUMpTiON
1.8%Wine
4.0%Milk-based beverages
8.2%Hot coffee
11.2%Beer
12.5%Carbonated beverages
12.8%Milk
15.3%Water
7.1%Others*
20.9%Hot tea
55
Evolution of the quantity and financial value of orange juice exports
1,619
2,500
2,000
1,500
1,000
500
0
Qua
ntit
y in
met
ric t
ons
x 10
00
NFC equivalent to 66o Brix FCOJ Value Exported (US$ millions)
200
0
200
1
2002
2003
200
4
200
5
200
6
200
7
200
8
200
9
Val
ue e
xpor
ted
in U
S$ m
illio
ns2,500
2,000
1,500
1,000
500
0
25
51 60
83 103
145 169 171
1,034845 1,041
1,193 1,058 1,111
1,469
2,2521,997
1,277 1,348 1,189 1,312 1,254 1,320 1,208 1,271 1,122 1,130
destination of Brazilian fCOj by decade and in 2009 North America Europe Asia Other continents
Sources: Elaborated by Markestrat based on data from Cacex, Siscomex & SECEX/MIDC.
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%1970s 1990s 20092000s1980s
3%
64%
33%
2%
2%
43%
53%
2%9%
63%
26%
3%
11%
70%
16%
4%
13%
71%
13%
Source: Elaborated by Markestrat based on Secex data
Import tariff rates for Brazilian orange juice
2009
Country/Region
Europe
united States
japan
South Korea
China
AustraliaOther destinations
Import tariff rate
fCOj 15,20%NfC 12,20%fCOj uS$ 415/tonNfC uS$ 42/ton25.50%54%7.5% for juice below-18°C and 30% for juice at temperatures above -18°C5%Exempt
Mexico has an exemption in tariffs until it reaches the volume of 30 thousand tons per year. However, the current Mexican exports to Europe do not reach that amount, being, therefore, exempt from taxation.
Sources: Elaborated by Markestrat based on data from Cacex, Siscomex & SECEX/MIDC.
57
SuST
AIN
ABI
lITy
The name of the island of Curaçao comes from the word curação (the art of healing or
curing), the name given by Portuguese sailors who found on that southern Caribbean island
the cure for patients stricken scurvy, who were saved by the vitamins from the fruit that they
ate on the island: oranges.
The lifetime of a citrus tree is up to 100 years.
North America and Europe account for 88% of all processed orange juice
consumed in the world.
59
SuST
AIN
ABI
lITy
Still being defined around the world, there is no single concept of
‘sustainability’ that is totally accepted, and there is no single formula
to determine what will become of this concept in the future.
However, a concept that is widely used and accepted is the one
formulated by the Brundtland Commission in 1987, which states
that “sustainable development is the development that meets the
needs of the present without compromising the ability of future
generations to meet their own needs.” The field of sustainable
development is divided into three pillars: environmental, economic
and socio-political. For a product to be sustainable, there must be no
imbalance among these three pillars, i.e., production must be socially
just, environmentally sound, and economically viable. If any one of
these concepts is missing, sustainability does not apply.
Brazil is a signer of the foremost treaties on the environment, such
as the Kyoto Protocol, and its environmental legislation is widely
recognized as one of the strictest in the world.
In the case of orange juice, one can say that this popular juice is the
drink of the future. This is because it can add a series of values from
its production that culminate in the creation of a tasty and nutritious
food product that helps preserve the world we live in.
In the manufacturing process of Brazilian
orange juice, the water removed for
the concentration of the juice is reused
in the system, incorporating major
environmental benefits
With the European market as the main importer, Brazilian
industries are signers of the code of conduct and are part
of the voluntary control system of SGF (Sure Global Fair),
an international organization founded in 1974 and based
in Germany, with a mission to promote safety and quality
of fruit-based products as well as to assure fair trade. SGF
has over 600 members in 60 countries, and periodically
conducts inspections of industrial facilities to assess
aspects of hygiene and environmental sustainability, as well
as social and economic aspects.
The code of conduct followed by its members establishes
standards to be observed with respect to labor aspects,
in accordance with the provisions established by the
International Labor Organization. In terms of environmental
sustainability, it stipulates that any negative impacts of the
supply chain on the environment must be identified and
minimum possible use of agrochemicals.
In the scope of SGF, the Brazilian orange juice industry
pioneered the creation of a project called Quality Initiative
South and East European Countries (QUISEE), in 2001
to promote fair trade and growth of the market
for juices and nectars in the Expanded
European Market.
The juice of the future,
straight from the present
How a 40-year old exporting sector
reinvents itself and becomes the
producer of one of the most sustainable
beverages the world has ever known
61
Orange juice production has been extremely sustainable
over the past years. In all, the orange groves that supply
fruit to the orange juice industry occupy an area of only
600,000 hectares. This corresponds to 10% of total area
occupied by sugarcane and 0,86% of all cropland in Brazil.
Productivity in the orchards increased 39% between 1995
and 2008 as a result of research and investments. The
main citrus production is in the state of São Paulo, which
meets strict environmental laws that require preservation
of native woodlands and mandatory areas of permanent
preservation, among others. The citrus industry does not
practice deforestation and does not promote direct or
indirect changes in land use.
From a social standpoint, municipalities with orange
groves have somewhat higher human development
indexes (HDI) than municipalities that produce other
commodities. In all, more than 10,000 producers derive
their livelihoods from the land, selling oranges to the juice
industry; but what is most striking in the production of
orange juice is the industry’s relationship with one of the
major sources of life: water. In the factories, juice producers
try to use as little water as possible from the public
water system or from rivers and streams. On average, an
orange juice processing plant obtains only 25% of the
total amount of the water required from the public water
supply or rivers/streams, while the remainder comes from
the very process of juice concentration, which requires
water to be evaporated. Rather than simply throwing
away this precious asset, the evaporated water is reused
for different functions within the industrial structure itself,
such as washing fruit and cleaning equipment.
Moreover, the factories have wastewater treatment
plants and there is no solid waste generated, since
every part of the fruit are utilized.
Another important point is the measurement
of carbon emissions, something demanded by
consumers concerned about the fate of our planet.
In 2010, the Brazilian industry conducted a study
whereby practically the entire citrus juice exporting
sector was mapped out. Everything from growing the
fruit, to agricultural and industrial processes, ground
transport, and sea transport to European terminals
was calculated. However, according to specialists, it’s
impossible to measure the carbon footprint based
on only one year’s harvest, and new calculations
will be done in the coming years in order to make
it possible to identify a figure for the entire chain of
citrus production.
Around the world, various segments of the economy
have been seeking to measure their emissions, but
Brazilian orange juice is the first case in which an
entire sector will be measured. This is an important
step to show the concern of Brazilian producers
not only for the health of their business, but for the
health of the planet we live on.
For human health, orange juice is a great ally. In
addition to the known benefits of vitamin C, it is a
drink that has no fat, sodium or refined sugar, in the
case of 100% juice. Good for those who drink it, good
for those who produce it, and good for the Earth.
SGF - SURE, GLOBAL, FAIR.Every two years, the industries are visited to check for
compliance with the code of conduct. In the last visit
(2009/10), SGF reported that it found no child labor
or forced labor, and that Brazilian juice industries
collaborate with the communities in which they
operate, sponsoring cultural events, supporting social
projects, and employing workers from the region.
CARBON FOOTPRINT:CitrusBR has a sustainability subcommittee consisting
of representatives from member companies, whose
objective is to discuss, with national and international
players, important issues related to sustainability such
as carbon footprint, usage of water, utilization of waste,
and sustainable agricultural practices, among others.
The concept of carbon footprint is an important tool
for identifying opportunities for reducing emissions of
greenhouse gases (GHGs) in the sector that produces
orange juice.
SGF
63
Recycling of garbageThe industrial units, through
selective garbage collection,
collect the following items
and send them for recycling:
paper, plastic, glass, metal
cans, etc. All of the material
is donated to cooperatives
associated with city gover-
nments, generating income
and employment and perfor-
ming important social work
in municipalities within the
citrus belt.
Recycling of wasteThe waste products
generated in industrial
production of juice are
utilized in the manufac-
ture of citrus pulp bran.
Thus it avoids the emis-
sion of solid waste.
Reuse of waterWaste from the orange
juice concentration
process, also called
“condensate”, is used for
fertirrigation, washing
fruits, and other industrial
processes. The system
benefits the environment
because it reduces the
need for catchment
of water from rivers/
streams or the public
water supply.
Control of pollution and rational use of energyThe control of air pollution
and noise pollution, as well
as minimizing environmental
impacts, are also observed
by the enterprises.
Research is conducted and
investments are made in
modification of the process
in order to minimize emis-
sions of pollutants, odors
and noise.
A modern, humane and sustainable industry
ReforestationAll of the industries maintain
nurseries that produce seedlings
of around 30 different species,
destined exclusively to replace
native trees that have died in areas
of preservation or permanent
conservation on the farms them-
selves. These actions are comple-
mented by ongoing educational
processes geared toward industry
employees and their families.
The Orange Juice Industry acts on two fronts: raising awareness and acting in line with the best practices for
sustainable production.
The goal is to raise awareness among employees, contractors and partners who, upon performing these tasks
built into day-to-day activities, are helping themselves, their children, and especially future generations.
Sustainable PracticesBrazilian industries adopt a series of economic,
environmental and technical strategies, practices
and conduct that reduce or avoid the emission
of polluting solids, liquids and gases into the
environment. These are preventive actions that
avoid the generation of pollutants or create
alternatives for such substances to be reused
or recycled.
Social ProjectsThe industries support and implement
various projects in the areas of Education,
Health and the Environment in the
municipalities where they are located.
Education and CitizenshipSupport for children and teenagers
regularly enrolled in public schools, through
donations, provision of school materials,
uniforms and toys, among others, both
individually and through partnerships with
institutions involved in protecting the rights
of children. Additionally, educational and
vocational projects are developed.
HealthSupport for prevention projects,
educational campaigns, free
medical care, eyecare and dental
treatment, including mobile
hospitals.
TerminalsISO 14001 certification
of port terminals certifies
that the companies have
a globally recognized
environmental management
system, more comprehensive
than required by Brazilian law.
13
12
11
10
98
5
6
7
4
3
2
1
2b
2a
10
How the Brazilian orange juice industry worksDuring the orange juice production process there is no solid waste. All parts of the fruit are utilized, and water and energy are used in a sustainable way
Sustainabilityn Using only 1.2% of its croplands, Brazil produces more than 80% of the total exported orange juice worldwide.
n Since 2003, grove productivity has grown by 20%, without an increase in land use.
n More than half of the water used in the factories comes from the fruit itself, obtained during the concentration process of the juice.
n All parts of the orange not used for juice are utilized for the fabrication of various by-products, leaving no solid waste in the environment.
n The energy used in the factories comes from renewable sources, such as hydroeletric power plants and burn of sugarcane bagasse.
n Apart of the industry’s light fleet uses ethanol. In Brazil, even gasoline contains 25% ethanol and national diesel uses 5% biodiesel.
HarvestMost of Brazil’s orange production is concentrated in the country side of the São Paulo state. In the groves, the fruit is hand-picked so as not to damage the fruit.
1 ReceivingThe industries are strategically located so that the oranges arrive without losing its quality between harvesting and extraction. The trucks are elevated by inclined ramps to speed up unloading.
2 InspectionSamples are taken from each truck for quality analysis in the laboratory before being processed. The results from this analysis help to identify particularities of each harvest.
2a 2b BinsThe oranges are brought by conveyor belts to the bins, large storage silos.
veil
bag
boots
gaiters
gloves
apron with sleeves
protective eyewear
PPEPersonal Protective Equipment
Washing and selectionBefore extraction, the oranges undergo a water and sanitizer washing process to eliminate impurities. Then, they are manually selected by professionals to make the juice. Discarded oranges are used in animal feed production.
3
DeaerationBecause it contains more water, the NFC passes through a process of deaeration in a vacuum chamber, so that the dissolved oxygen in the liquid can be removed. In so doing it prevents the vitamin C from oxidizing throughout the process.
7 FCOJMost of the juice, which is used in the production of FCOJ (Frozen Concentrate Orange Juice), goes to the evaporators to reach 66 Degress Brix, removing a part of the water and volatile components. The juice is pasteurized in the same equipment.
8 Tank-blendersThe FCOJ then passes through a mixing and homogenization process to give it the ideal taste and appearance for exportation. In this step, some components dissipated during evaporation – like the aromas – are added back in.
9 Ideal condictionsThe FCOJ and the NFC are stored in refrigerated tanks and from this point on the product does not have contact with the air. They are then pumped into special trucks that transport them to the terminals at the Port of Santos.
10 Refrigerator tanksAt the port the products are pumped again into large special tanks. The juice is kept at the ideal temperature until the arrival of the ship, also with refrigerated tanks, which will transport the FCOJ and NFC abroad safely.
11Maritime transportThe ships can carry up to 43 thousand tons of juice and take the product to main foreign ports, particulary Rotterdam (Holland), Gent and Antwerp (Belgium), Florida (USA), Newcastle (Australia) and Toyahashi (Japan).
12ConsumptionThe NFC and the FCOJ are delivered to clients, juice and drink bottlers, who are then going to package the products with their own brand in accordance with the particular tastes of their countries. The FCOJ will have water and sugar etc. added. The NFC is delivered ready to consume and the clientes is responsible for packaging and distribution. Only then the product is made available for the end consumer.
13 LeadershipBrazilian orange juice is the leader in the international market, and it is present in more than 90 countries, especially in North America and Europe.
14
ExtractionThe extractors are adjusted to receive different sized oranges. Therefore, each fruit receives pressure to extract the maximum amount of juice without removing undesirable components that should not be mixed in. The leftovers, like the pulp and the seeds, are used to make by-products.
4 FinishingThe finishers separate any residues that may have remained in the juice after extraction, like seeds and pulp. Next, the juice passes through a centrifuge to standardize the final product. From this point on the process is divided into the production of concentrate and not-from-concentrate orange juice.
5
Brazil exports more than 1 million tons
of orange juice per year.
All techniques used, at every step of the way,
from the grove to the refrigerated
storage tanks in foreign ports, are technology
developed in Brazil.
3 out of every 5 glasses of orange juice
consumed in the world are Brazilian.
A ship carries up to 43 thousand tons of FCOJ, or the equivalent to more than
32 million 1 liter bottles.
Every 10 minutes an orange juice tank truck descends “Serra do
Mar” highways towards the Port of Santos, on the coast of São Paulo.
Degree Brix is
a standard measure to determinate the
soluble solids or total sugars in the
juice
Everything is usedUp to nine by-products can be extracted from an orange
Comminuted Citrus Base
Citrus Pulp Pellets
Pectin
Pulp
Pulp wash
Peel essential oil
Alcohol
Essences
D-limonene
NFCThe juice that is going to become a not-from-concentrate is pasteurized, which means it is heated and cooled to deactivate enzymes that could affect appearance and taste, in addition to microorganisms harmful to our health.
6
14
63
The Orange Juice Industry acts on two fronts: raising awareness and acting in line with the best practices for
sustainable production.
The goal is to raise awareness among employees, contractors and partners who, upon performing these tasks
built into day-to-day activities, are helping themselves, their children, and especially future generations.
Sustainable PracticesBrazilian industries adopt a series of economic,
environmental and technical strategies, practices
and conduct that reduce or avoid the emission
of polluting solids, liquids and gases into the
environment. These are preventive actions that
avoid the generation of pollutants or create
alternatives for such substances to be reused
or recycled.
Social ProjectsThe industries support and implement
various projects in the areas of Education,
Health and the Environment in the
municipalities where they are located.
Education and CitizenshipSupport for children and teenagers
regularly enrolled in public schools, through
donations, provision of school materials,
uniforms and toys, among others, both
individually and through partnerships with
institutions involved in protecting the rights
of children. Additionally, educational and
vocational projects are developed.
HealthSupport for prevention projects,
educational campaigns, free
medical care, eyecare and dental
treatment, including mobile
hospitals.
TerminalsISO 14001 certification
of port terminals certifies
that the companies have
a globally recognized
environmental management
system, more comprehensive
than required by Brazilian law.
A
Acidity – The acid content of a
particular juice.
Albedo – The white spongy layer that
lies just beneath the colored part of the
orange rind (the flavedo). The albedo is
rich in pectin.
Aroma – A particular smell with positive
connotation. In the case of orange juice,
the word is also used to refer to the flavor
(essence aroma).
Ascorbic acid – A vitamin found
in plants, especially fruits and green
vegetables. Forms white crystals when
purified and dehydrated. Also called
vitamin C.
B
Box – For oranges, a measurement
equivalent to 40.8 kilograms of fresh fruit.
Brix (degree) – Unit used to express
the quantity of total dissolved solids in
the juice.
C
Corrected Brix – The Brix measurement
obtained after correcting the acid
content of the juice. Represents the
concentration of sugars in the juice.
Carotenes – The class of red, yellow and
orange pigments that occur naturally in
fruits and vegetables.
D
Degasification – The process whereby
air is removed from the juice. Dispersed
air and free bubbles are easily removed,
but the air dissolved in the juice requires
a degasification process for removal.
Defects – The term is used to indicate
factors harmful to the quality of the juice,
for example the presence of small seeds
or excessive acidity, among others.
D-Limonene – The main component
of the oil found in orange peels,
representing more than 90% of the
orange peel oil. Belongs to a group of
hydrocarbons called terpenes.
E
Endocarp – The inside of the orange
fruit.
Essence – The volatile components that
are recovered during the evaporation
process. The essence is separated into an
aqueous stage (essence aroma) and an
oily stage (essence oil).
Essence Aroma – The aqueous phase
obtained in the evaporation process. It is
transparent and contributes to the flavor
of fruit.
Essence Oil – The oily phase obtained
in the evaporation process. It has a
yellowish color and is the source of
certain flavor notes.
Essential oils – A general term to
describe the volatile oils extracted
from plants, fruits and flowers, with
characteristic odors.
Evaporation – The process of removing
water from the juice using a heat source.
Extraction – The process of extracting
the juice from the orange, either from
whole or halved fruits, by means of
mechanical pressure.
F
FCOJ – Acronym for Frozen Concentrate
Orange Juice. It is the most common
product sold and shipped. Commercially,
it is produced in order to obtain 66
degrees Brix.
Finisher – Equipment used to separate
the pulp from the juice.
Flavedo – The colored and
outermost part of the orange peel. The
characteristic color is due to
the presence of carotenes.
Flavedo also has vesicles
containing orange peel oil.
J
Juice sacs – Another name for the
“buds” that contain the orange juice.
N
NFC – Acronym for not-from-
concentrate, i.e., juice that has not
undergone the process of concentration
or dilution after being extracted from the
orange.
O
Organoleptic - Relating to the
properties of fruits or juices that can be
perceived through the five senses.
P
Pectin – A type of polysaccharide
found mainly in the albedo, but also in
other parts of the fruit. It gives the juice
viscosity and texture.
Pulp – Solid particles in orange juice.
Also the commercial name of the product
that consists of chunks of bagasse and
sacs containing orange juice, re-added to
the final juice.
Pulp wash – Juice obtained through a
process whereby solids are recovered
from the pulp through washing.
Glossary
69
Recycling of garbageThe industrial units, through
selective garbage collection,
collect the following items
and send them for recycling:
paper, plastic, glass, metal
cans, etc. All of the material
is donated to cooperatives
associated with city gover-
nments, generating income
and employment and perfor-
ming important social work
in municipalities within the
citrus belt.
Recycling of wasteThe waste products
generated in industrial
production of juice are
utilized in the manufac-
ture of citrus pulp bran.
Thus it avoids the emis-
sion of solid waste.
Reuse of waterWaste from the orange
juice concentration
process, also called
“condensate”, is used for
fertirrigation, washing
fruits, and other industrial
processes. The system
benefits the environment
because it reduces the
need for catchment
of water from rivers/
streams or the public
water supply.
Control of pollution and rational use of energyThe control of air pollution
and noise pollution, as well
as minimizing environmental
impacts, are also observed
by the enterprises.
Research is conducted and
investments are made in
modification of the process
in order to minimize emis-
sions of pollutants, odors
and noise.
A modern, humane and sustainable industry
ReforestationAll of the industries maintain
nurseries that produce seedlings
of around 30 different species,
destined exclusively to replace
native trees that have died in areas
of preservation or permanent
conservation on the farms them-
selves. These actions are comple-
mented by ongoing educational
processes geared toward industry
employees and their families.
InstItucIonal PublIcatIon
CitrusBR – Brazilian Association of Citrus Exporters
Executive President Christian Lohbauer
General CoordinationLarissa Popp AbrahãoMarta Martins DeVito
Editorial CoordinationIbiapaba Netto
TranslationBTS
Research and SupportLarissa Popp AbrahãoLetícia de Sena CaritáDebora Garcia Dezan
Planning and DesignMarta Martins DeVito
Art EditionTypoDesign
PhotographyLau Polinésio
Bob ToledoDouglas AptekmannDreamstimeIstock Photo
InfographicDuo Dinâmico
PrintingPancrom
Print run 3.000 copies
CRE
DIT
S
book RefeRences
The Orange Book
Tetra Pak, 2004
Caminhos para Citricultura
Markestrat ( coord.), 2007
O retrato da citricultura brasileira
Fava Neves, Marcos (coord.), 2010
P+L Cítricos Series
Cetesb, 2005
Websites accessed in November, 2010:
FDOC – Florida Department of Citrus (EUA)
For growers and processors
www.fdocgrower.com
Florida Citrus (EUA) Website elaborated by
FDOC to consumers
www.floridajuice.com
Ultimate Citrus (USA)
www.ultimatecitrus.com
JPA - Juice Products Association (USA)
www.juiceproducts.org
IFU – The International Federation of Fruit
Juice Producers
www.ifu-fruitjuice.com
AIJN – European Fruit Juice Association
www.aijn.org
SGF International
www.sgf.org
Fruit Juice Facts
www.fruitjuicefacts.org
I feel connected. I feel inspired.I feel healthy. I feel posi t ive.
SUPPORT:
In an innovative action, the Brazilian orange juice producers and exporters, represented by CitrusBR, launched in 2011 the I feel orange project. The project, developed in partnership with the Brazilian Trade and Investment Promotion Agency (Apex-Brasil) will promote the world´s favourite juice and constantly research the global community connected through the social
networks, which already totals more than 700 million people. Based on this research, the I feel orange project will offer customized information about the orange juice and content about the “orange attitude”, an inspiring and vibrant trend discovered on the web. Want to know more?Visit us at ifeelorange.com
Orange. The world´s favourite juice with an attitude.
Ifeelora nge.com
An Citrus FeelOrange 42x29,7cm.indd 1 7/8/11 11:54 AM