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Juices, Purées &Superfruits 2013

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© Informa UK Ltd 2013 - FOODNEWS® June 2013 3www.agra-net.com

Juices, Purées & Superfruits 2013

Small in volume, high in profits

CONTENTS

Small in volume, high in profits 3

Shell game 4

The taste of China 8

The Red Tide 11

Super-desirable 13

T.B. Fruit: a celebration 14

Pineapple resurgence 18

Sharing and swapping 20

Tariff confusion 22

The Big Ones 24

The growth of mango 26

© FOODNEWS 2013. All rights reserved. No part of this publi cation may be reproduced or transmitted in any form or by any means without the written permission of the publisher.

ISSN 0951-130X. Registered Trade Mark: FOODNEWS®. Informa Plc.

Ad vertising in FOODNEWS and its supplements is accepted on condition that the advertiser will indemnify the company from any claims or actions arising from the appearance of an advertisement.

FOODNEWS is published by Informa Agra, IBI, Guardian House, 119 Farringdon Road, London EC1R 3DA, UK.Phone: +44 (0) 20 7017 7500 Fax: 0044 20 7017 6985 Email: [email protected] www.agra-net.com Managing Editor: Neil Murray Deputy Editor: Julian Gale Managing Director: Philip Smith Specialist reporters: Amy Booth, Davide Ghilotti Design & Production: Jane Crispin, Steve Aylett Advertising Manager: Sunny Patel Tel: +44 (0) 20 7017 4153 Fax +44 (0) 20 7017 7594 Email: [email protected] Enquiries: Email: [email protected] Tel: +44 (0)20 7017 5540 or (US) Toll Free: +1 800 997 3892Online Access: Email: [email protected] Tel: +44 (0)20 7017 4161

BY NEIL MURRAY

HIGHER value. Fruit juices may be commoditised, and margins may be vanishingly small in some retail sectors, but there is still room for growth, and still some areas where juice can offer reasonable returns.

Fruit juices happens to be a sector where consumers are hungry for innovation and new taste experiences. At the same time, while there is some concern over the sugar content of some fruit juices, and the effect on tooth enamel of others, by and large consumers recognise that juice is a healthy product and one whose consumption should be encouraged.

A key problem has always been that there is a finite (and not very large) number of different types of fruits that are regularly consumed as juices, and short of inventing new species, one has to work with what Mother Nature has provided. Likewise, this means that there are (mathematically) only so many blends that one can come up with before all possibilities are exhausted.

The growth of interest in superfruits has come as a godsend for the juice industry. In some cases these are new products: in others, they are products that have been familiar to consumers for years, even decades, but research has only recently brought their health benefits to the attention of the public. For example, cranberries have been a familiar

part of the US diet for generations, and cranberry juice drinks have been popular in Europe for years, but interest has been stoked by the discovery that the antioxidants in cranberries have a proven beneficial effect on urinary problems.

And in the US, blackcurrant, familiar to millions of Europeans as a dessert ingredient or juice, but whose cultivation was banned in the US for about a century, is starting to find a whole new market.

Few superfruits or the new generation of tropical exotic fruits are drunk as pure juice. You could not drink pure cranberry juice – it would strip the enamel from your teeth. Some people do not think that pure açaí is particularly palatable, either. But that is not the point. Even relatively low percentages of something exotic are enough to

justify a premium. And with some tropical fruits, whether they are superfruits or not, their appeal is considered worth the extra cost. Passion fruit, for example, is irresistible. It has an utterly fantastic name (‘soursop’, on the other hand, does not!) and it imparts a wondrous taste at very low concentrations. The only thing it does not seem to boast is a quantifiable health benefit, although passion fruit extract is said by some to be an aphrodisiac.

Even better, tropical and exotic fruits are gaining traction in the nutraceutical and even cosmetic markets. When a product is being advertised as beneficial to a body’s exterior (and someone else is paying for that advertising), it seems like a wonderful opportunity for the juice industry to point out that it’s quite good for the inside of the body as well.

© Informa UK Ltd 2013 - FOODNEWS® June 20134 www.agra-net.com


BY NEIL MURRAY

SOME three billion litres of coconut water are discarded every year, according to a recent industry estimate. This is simply regarded as waste product by processors who transform raw coconuts into other products such as desiccated coconut, coconut milk, coir or all three together.

As a young (between six and nine months old) coconut contains about 750ml of liquid, this equates to about four billion nuts.

The first mention of coconut water in FOODNEWS was in the autumn of 2000, when a news story noted that a recommendation from the FAO that it should be sold as a natural energy drink for joggers and athletes. The UK had granted a patent to the FAO on new technology that allowed man-ufacturers to offer it as a pre-packed drink.

This was the first patent given to a UN agency and similar requests for patents in Canada and Japan were lining up. In what proved to be a far-sighted comment, the FAO said that the new technology and the beverages that it could provide held “tremen-dous promise” for tropical countries. “Countries that process or export coconuts and small farmers who grow them will be the main beneficiaries of the newly-patented technology,” it added.

Most coconut water is still con-sumed fresh in tropical coastal areas. Once exposed to air, the liquid rapidly loses most of its nutritional characteristics, and begins to ferment.

Fresh coconut water (take a coconut, slice a hole in it, poke a straw through and drink the con-tents) has long been popular in India. And India, as far as we can gather, was the first country to talk about building plants to process coconut water. The idea was mooted in early 2001, in the state of Kerala, where research by the state’s university decided to stop selling carbonated soft drinks in its

canteens, and replace such drinks with coconut water. This was another amazingly prescient move.

Sure enough, some small manu-facturers started processing coconut water in Kerala, and other Indian states. It took a very short time for the soft drinks majors to start taking an interest. In late 2009, Tropicana approached a private firm, Miracle Food Proces-sors Ltd, in north Kerala, to mass-produce the beverage. However, Tropicana encountered a typical early problem. It wanted 6 000 tonnes of concentrate annually and Miracle Food Processors could only provide 300 tonnes.

Coca-Cola was swift to follow. A couple of months after Pepsi-Co’s move, it was announced the Coke was considering making pre-packed coconut water drinks in at its existing factory premises in the Palakkad district of Kerala. This initiative had a second benefit: at the time, Coke was under fire for allegedly depleting ground water reserves around its factory, and the coconut water announcement helped divert attention for a while.

In the absence of any major production by Coke or Pepsi, India’s own industry took up the challenge in 2003. Its Coconut

Development Board (CDB) launched a venture to pack coconut water in aluminium cans, in concert with the local agricul-ture ministry and India’s Defence Food Research Laboratory (DFRL). This last should not be under-rated: it seems odd to call on the help of a military unit, but the DFRL has actually been instru-mental in developing pre-packed foods as spin-offs from projects to produce soldiers’ ration packs for the Indian army. Those foil-packed curries and processed vegetable dishes on sale in Indian grocery stores have their origins in DFRL projects.

Hasnabad, in the heart of the state’s coconut-growing area, was chosen for the project. Hasnabad has around 1 100 hectares of coconut plantations with over 150 000 trees producing more than 23 million coconuts annually. The local market then handled around 100 000 nuts on trading days. The plant had an initial requirement of some 25 000 nuts/day.

The breakthrough for the product came in early 2004, when at an IFU conference, Paul Zwicker, head of the IFU Codex Alimentarius task force, confirmed that the IFU had decided that

Shell gameCoconut water is the new ‘healthy’ fruit juice. What is its potential?

“In what proved to be a far-sighted comment, the FAO said that the new technology and the beverages that it could provide held “tremendous promise” for tropical countries.”

GERT vAN MANEN OF ITI TROPICALS



coconut water was a fruit juice and as therefore subject to the reg-ulations of Codex. This opened the door to the industry. One of the players who immediately saw the potential of coconut water drinks, now that they had been granted this status, was Gert van Manen of ITI Tropicals. He was looking for a new juice product. “This new idea started when I saw this article [in FOODNEWS],” he told the recent Juice Asia conference.

In those days, FOODNEWS maintained a paper-based index-ing system that categorised every story carried in the journal and that was published at the end of the year as a useful reference tool for those who saved their paper copies (as so many did). Nowa-days, you can just go to our website archive, type in some-thing like “orange juice” and see the number of stories, but back then no such facility existed. However, it was possible to see the number of stories on coconut water building and building.

By 2007, companies in India that had taken the DFRL

technology and gone into pre-packed coconut water drinks included SPA Coconuts, Sakti Coco Products, Jain Agro Food Products and Awadhoot Agro. Sri Lanka was also investigating the product’s potential.

The good thing about coconut water is that it can be made in pretty much any tropical region. As van Manen points out, coco-nuts grow freely in the tropics, but south-east Asia is the biggest source, followed by Brazil. Coconut varieties include the Solomon Island Tall, the Rennell Island Tall, Malaysian Tall, Malaysian Dwarf, Fiji Dwarf and the (boringly-named) Hybrid. “For me, Asia is the sector,” says van Manen. But there are still problems with the growing area and the yield. “Both of these parameters are extremely volatile. They are not stable at all and this is a concern.”

First sightingFOODNEWS’ first record of a coconut water drink being launched in the US (there must

have been others, but this was the first we picked up) came in early 2007, when Hurricane Juice launched its Thirst Equaliser available in mango/pineapple and lemon/ lime flavours, packed in 16oz PET bottles. It is worth noting that this was a sports drink: right from the start, the industry was capitalising on coconut water’s isotonic properties. Shortly after-wards, Vita Coco, another US brand of coconut water, intro-duced a new tangerine flavoured coconut water, claiming that it was the only coconut water on the market that uses only 100% natural fruit purées as flavouring.

The first trading company that we recorded to start offering coconut water was indeed ITI Tropicals (although, again, there were probably others before, and van Manen says ITI bought its first load of coconut water in 2004) in early 2008 with aseptic single strength natural coconut

“The breakthrough came in early 2004, when Paul Zwicker, head of the IFU Codex Alimentarius task

force, confirmed that the IFU had decided that

coconut water was a fruit juice and as therefore

subject to the regulations of Codex.”

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water, manufactured by Sambu Group and packed in 55-gallon drums and six-gallon boxes ex warehouse California. The company started offering concen-trate in the following year.

And after that, new product development positively exploded.

Coco-Cola and PepsiCo went back into the market, hard. In August 2009, PepsiCo bought Amacoco, the largest coconut water company in Brazil, for an undisclosed sum. Amacoco made the Kero Coco and Trop Coco brands, which accounted for the bulk of packaged coconut water sales in Brazil (oddly, Brazil is one of the few places that does not recognise coconut water to be a fruit juice; make of that what you will). And Coca-Cola Co took a stake in Zico Beverages, the maker of Zico coconut water sports drinks, and PepsiCo imme-diately afterwards took a stake in O.N.E.

What are the advantages and key selling points of coconut water? ITI points out that for bev-erage developers, it blends well with other juices, has a well-known nutritional profile, a translucent colour, gentle flavour, minimal texture and is available as concentrate and NFC juice.

For consumers, it is naturally low in calories and sugar, fat-free, contains no cholesterol, naturally hydrates, is a good source of potassium and magnesium and helps ‘mellow’ the acidic profile of other juices.

Market figuresSo what is the market worth? In the US, it could be as much as about USD350 million, according to Mark Rampolla, chief executive

of Zico, speaking at last year’s World Juice conference. He put retail values at USD250 million and added another USD100 million for food-service and sales through clubs, gyms etc.

However, despite this, Zico has yet to turn a profit. “We had to invest five times as much as we expected and the truth is that we are still not profitable,” he admitted. “The business has not made money in eight years.”

The odd market is Canada, where coconut water simply has not worked – yet. Major brands, such as O.N.E, Beyond, Zico, Grace, Blue Monkey, Cocos-Pure and others are all sold in super-markets and the foodservice sector also sells coconut water. But a recent Euromonitor report put annual sales at a mere CAD2.0 million (USD2.0 million) in retail and volume growth is negligible. It is also expensive.

“Taste remains an issue for many consumers,” said the report, and points out that the addition of other juices or blends to improve the taste undermines the key mar-keting attraction of coconut water; namely, that it is 100% natural and pure. They also add to the sugar, sodium and calorie content. “Flavoured coconut water does not fare well in com-parison with 100% pure products,” added the report.

Zampolla tends to agree that there is an issue with the taste. “Early on, we found that consum-ers did indeed hate the taste,” he agreed. “It is polarising, to say the least. It is one of these acquired tastes.” Zico has tried adding flavours, but the

top-selling variety is plain.

Consumers have been adding 100% coconut water to their smoothies and juices, thereby sticking to the original 100% products while overcoming the taste issue and it is suggested that this approach could be pro-moted in order to expand the retail customer base “Also, mar-keting support for ready-made flavoured products might do better comparing the products to soft drinks, such as juice drinks and carbonates, to showcase a better nutritional content and encourage purchases,” suggested Euromonitor.

There has been experimenta-tion with products, the emergence of unforeseen problems, heavy investment, and the securing of raw material supplies.

But the market continues to grow. In Brazil, sales of coconut water products last year hit 65 million litres, overtaking energy drink volumes. Coconut water is still coming from a very low base. The issue for manufacturers now is to secure their raw mate-rial supply. This has been done. Some soft drinks majors in the US are tying up deals for

concentrate in Brazil, for example. This requires a lot of investment: the establishment of concentration plants at the points where the coconuts are processed for other use. Döhler is busy for-mulating new coconut water beverage concepts, and this is a company that does not have a reputation for backing failures.

And for the future? It is here to stay. What we have witnessed is the first stage in the establish-ment of a totally new product, and it has all happened in little more than a decade.

“Consumers have been adding 100% coconut

water to their smoothies and juices, thereby

sticking to the original 100% products while overcoming the taste

issue and it is suggested that this approach could be promoted in order to

expand the retail customer base.”

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BY NEIL MURRAY

FRUIT juice is a minor beverage commodity in China, and likely to stay that way for some time. But consumption is growing, and in all sectors – pure juice, nectars and juice drinks – orange has the largest share.

Daniel Liao, chief executive of China Tianyi Holdings Ltd, recently presented the latest orange juice data to come out of China and the Far East and, while orange juice imports by many countries in the region are small, the growth potential is huge. Chinese annual per capita con-sumption of fruit juice is presently under two litres.

In China, he said, “orange juice is very different from apple juice. Apple juice is produced just for export. Orange juice is for domes-tic consumption.” However, there has never been a culture of drink-ing orange juice in China until very recently, despite the country’s massive citrus crops. “People do not drink orange juice but they do eat oranges,” pointed out Liao. “Nobody drinks orange juice for breakfast, but I tell you that in the next two or three years… someone will be drinking orange juice at breakfast.”

While Europe and North America have cut back their con-sumption of orange flavoured beverages (between 2003-11, there was a 5.0% decline in Europe and

an 18.6% decline in North America, based on consumption of FCOJ), Asia has seen growth of 17.3% to 240 000 tonnes of FCOJ from 212 000 tonnes. Much higher percentage increases can be seen

in the Middle East and Africa - 58.7% and 54.5% respectively - these involve far lower volumes: after North America and Europe, Asia is the largest market for FCOJ.

However, China reports 129.4% growth in orange juice consumption during that period: far more than in other Asian coun-tries and regions.

The thing to remember with China is that the country has a long, long history of hot bever-ages, especially tea, and very little history of fruit and vegetable juice consumption. Tea, tea drinks and carbonated soft drinks account for 77% of the Chinese beverage market. Fruit and vegetable juices account for just 23%. However, as stated above, within this sector, orange remains strong.

The taste of China

“The thing to remember with China is that the country has a long, long history of hot beverages, especially tea, and very little history of fruit and vegetable juice consumption.”

Orange, 57.8%

Apple, 13.8%

Blends, 8.0%Grape, 6.0%

Others, 14.4%

Nectars

2011 JUICES AND NECTARS FLAvOURS IN CHINA: NECTARS

China is a massive producer of apple juice, and a growing producer of orange juice, but its own tastes lie elsewhere.

SOURCE: Tianyi



There is still no way that China can meet its domestic demand, even at present con-sumption levels, from its indigenous industry. The first notification that China was going to establish its own orange juice industry came in 2002, when the Chinese government announced that it was to invest about CNY3.8 billion (USD460 million at the then exchange rate) in the next few years to boost the orange (and animal-husbandry industries) in the Three Gorges to create jobs for hundreds of

thousands of residents resettled as a result of the construction of the massive eponymous dam there. China estimated that it would take eight to 10 years to crank the industry up to a processing capac-ity of five million tonnes of fruit.

At the IFU conference in China in 2005, the timetable for Chinese juice production was out-lined. It was forecast that by 2010, China would be making 800 000 tonnes of single strength equivalent (SSE) orange juice (or 145 000 tonnes of FCOJ), and this would increase to 1.5 million

tonnes in 2015 and 3.0 million tonnes in 2020. However, China’s output has fallen far below fore-casts. According to Liao, citing

USDA figures, China produced just 40 000 tonnes of FCOJ in the 2011/12 season. For comparison, the US produced 830 000 tonnes and Brazil 1.31 million tonnes. China’s production was a big improvement over the previous season’s 14 000 tonnes, and it reduced Chinese imports to 60 000 tonnes from 77 000 tonnes in 2010/11, but domestic con-sumption was still rising and hit 102 000 tonnes in 2011/12.

China is still a market for low juice content drinks – pure juice is relatively rare. “Currently, four out of five of the largest juice manufacturers in China engage in the production of low concen-trated fruit juice,” said Liao. “In terms of million litres consumed, juice drinks account for 94.2% and pure juice only accounts for 2.8% of the market in China.” In the orange sector, pure orange juice holds 3.5% of the market, nectars hold 4.0% and low juice content drinks the rest. Three

Brand Manufacturer Juice content (%)

Pack (ml) Retail price (CNY)

CNY/litre (excl juice

content)

Minute Maid Coca-Cola 10.0 450 3 6.67

Hello-C Wahaha >10.0 450 4 8.89

Huiyuan Huiyuan >30 2500 14 5.60

Duo Uni-President

10.0 450 2.5 5.56

Dole Dole 97.5 250 3.7 14.90

SOURCE: China Tianyi Holdings

CHINA ORANGE JUICE MARKET SHARE

Orange, 48.0%

Apple, 30.5%

Blends, 17.0%

Grape, 1.0%Others, 3.5%

Pure juice

2011 JUICES AND NECTARS FLAvOURS IN CHINA: PURE JUICE

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major manufacturers (Coca-Cola, Master Kong and Uni-President) hold three-quarters of the market.

As an aside, Liao revealed why pulp drinks are so popular in China. “Everything in China can be fake,” he said.” Even a chicken egg can be fake. Pulp is very important – real pulp means it’s real orange juice. This is a very, very important item for orange juice in China.”

The Chinese government has now decided to move the orange juice industry to its national economic plan, Liao revealed. This is a major step change: it makes the industry a national priority. It has set a goal to cut down imports by 2020 to no higher than 50% of the Chinese market from their present level of 80%. The Twelfth Five-Year Plan aims (these are its stated objectives) to improve farmers’ living standards, support the agricultural industry and create business opportunities between farmers and processing companies.

As part of this, the government will provide industrial land and cash help (or subsidies) to processors. This will allow them, to stablise their raw material supplies, ensure the quantity of supplies, and minimise raw material costs. For farmers, more agricultural land will be made available. This will improve fruit yields and quality,

lower the cost of cultivation and stabilise their incomes.

This will make it very difficult now for foreign processors to enter the market. The Plan is not just intended to stimulate a domestic industry: it is intended to keep foreign competition out. Upstream investment (ie: in new citrus groves and primary processing plants) needs governmental approval which is, said Liao, studiedly, “difficult for foreign companies to get. Basically, they want to develop this industry.” And, he added: “The Chinese

government is rich and can do what it wants.”

With the expansion of the industry will come growth in use of orange by-products, such as pulp, pectin, oil, D-limonene, citrus pulp pellets, comminuted citrus base and other items. Chinese annual production of orange peel is presently around 3 000 tonnes, while annual demand is 6 000 tonnes. Global demand for pectin is around 55 000 tonnes, said Liao, while annual production is just 45 000 tonnes. There is a big opportunity here for China.

Orange, 39.9%

Apple, 8.0%

Blends, 13.0%

Grape, 9.0%

Others, 14.6%

Juice drinks

2011 JUICES AND NECTARS FLAvOURS IN CHINA: JUICE DRINKS

“Everything in China can be fake. Even a chicken egg can be fake. Pulp is

very important – real pulp means it’s real orange

juice. This is a very, very important item for orange

juice in China.”

SOURCE: Tianyi

http://www.trisun.co.il



BY DAvID BERRYMAN

I RECENTLY came across an article which I wrote a few years ago for a business periodical (not as prestigious as FOODNEWS of course!) where I extolled the virtues of any liquid which could be imbibed which was red in colour.

In essence, I explained my take on the then-buzz topic of antioxidants. If it’s red, I said, it’s an antioxidant. And for antioxi-dant we could now read anti-anything else which might be bad for us. Red juices could be seen as anti-ageing (everyone listens to that), anti-cancer, anti-obesity even anti-acne. In fact, any of the thousand and one

ailments and discomforts to which our human condition is subject could be tackled by red fruits and their juices.

This was backed up by the huge mass of evidence which appeared almost daily about the efficacy and general goodness of such juices, by saying that we humans belong to a very distinc-tive and tiny group of creatures incapable of making vitamin C in our own bodies. It appears to be an almost unique feature of monkeys with no tails. I like to mention this because it is a genu-inely important reason to encourage people to drink fruit juices.

And also, because, as long-time biologist, I quite like the idea that it’s a well-kept secret I share with a very distant cuddly cousin, the orangutan.

So where are these super red juices now? Has the fizz gone out of the red drinks market? Do we still have the same appetite for them as before? I think not. And I believe there are a number of reasons for this.

First, I believe we as an indus-try failed to take advantage of cementing claims with EFSA. Now even modest claims are inadmissible in Europe. I believe it would have been money well spent in this dash for claims project.

Secondly, I believe there were too many unsubstantiated claims made. Many were irresponsible (for example, claiming to cure instead of prevent ailments). Some were even laughable (I’d better not mention those).

Thirdly, marketing has limped along. The (M)ad men seem to have forgotten that any commodity has life which has a beginning and an end. I don’t like irresponsible advertising and promoting, but I love and enjoy good ones.

Fourthly, far from being good for us, all fruit juices are now being targeted as agents for obesity and the consequent illnesses it brings.

Instead of delivering health bene-fits, juices, we are told, contribute to all of us getting fatter.

I think this last point must be taken seriously. I understand that in Europe, only about 2% of carbohydrates (one of the main causes of obesity), is consumed in soft drinks and fruit juices. If this is the case, why do so many members of the medical profession campaign against this sector?

Well, it’s all to do with the speed at which the sugars get into the bloodstream. Drinking any liquid containing any type of sugar will mean that it will be absorbed many times more quickly than if one eats the fruit. The body may not be able to react quickly enough to manage this rapid sugar invasion. If we don’t exercise

enough to use the sugar, as a population, we will start to get fatter and, for example, become prey to Type 2 diabetes. The latter is particularly linked to soft drinks. So what can we in the juice industry do about it?

For sure, we should not be ostrich-like. If it is a genuine problem we should not simply be in denial. And don’t forget, we in the red juice business have good news to sell: it looks good, it tastes good and it does you good! But, and here’s the big ‘but’, most red juices are high in acid and traditionally have been loaded with sugar to make them palatable. This means we could be accused of adding to the obesity problem.

Let’s consider ways of overcoming this issue. We could

The Red TideRed fruits are healthy. But what are the red superfruits of tomorrow?

“I believe we as an indus-try failed to take advan-tage of cementing claims with EFSA. Now even modest claims are inadmissible in Europe.”

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sweeten with artificial low or no calorie sweeteners. This works quite well, but is not popular with everyone.

We could use a natural low calorie sweetener such as stevia. This is a leaf extract which is effective and has been used in South America for some years.

We could simply dilute red juices to, say, half their natural strength. However, in the cases of popular red juices such as cranberry or blackcurrant, the high acid taste could still be a problem and generally unpalatable.

New juice suggestionsWe could find red juices which are drinkable without the

addition of extra sugars or sweeteners. So I would like to suggest two new juices that would tick the boxes of being low in calories, having a good natural taste, good colour, no added artificial anything (you get the idea) and so on.

The first is mulberry juice. I have felt for some time that this is a very undervalued juice. The silkworm feeds specifically on mulberry leaves in the spring and summer and in the autumn, the tree bears fruit which look like elongated blackberries (the fruit, not the mobile phone).

The fruit contains about the same percentage of sugars as most red fruits, but as the acid

level is low, mulberry juice tastes sweet with a very rounded and fruity taste. Our NPD team has found it to be one of the most flexible and versatile of red juices and the first choice for blending with citrus or tropical juices. Mulberry juice can easily be offered as a 4 or 5 brix ready to drink beverage. Taste, appearance, high antioxidant and low cal boxes all ticked!

The second is honeysuckle berry juice. I first came across this juice three years ago in northern China.

I understand it is also now being grown in Canada. Honeysuckle berries look like large stretched blueberries. The honeysuckle berry samples that I saw had blue flesh, unlike

cultivated blueberries which are blue only on the outside and have green flesh.

Consequently, the juice has many times more anthocyanins than blueberries. For anthocyanins, read taste and colour. With relatively low acid, it is a perfect low calorie natural just-juice-and-water candidate.

So don’t write super red juices off – as I said, they look good, taste good and do you good.

We should drink to that!

“The first is mulberry juice. I have felt for some

time that this is a very undervalued juice.”.

MULBERRIES

HONEYSUCKLE BERRIES

http://www.tradecos.com.ar


BY vLADIMIR PEKIC

BRAZIL’s superfruits market is inevitably heading towards a major transformation in 2013 as some the biggest beverage industries are gearing up to cap-italise on the growing popularity of the country’s most potent and nutrient-rich fruits.

At the same time, authorities in Brasilia are offering new tax breaks that will make it even more attractive to produce guaraná and açaí-based soft drinks.

Although there is no widely agreed method for classifying superfruits, these species can generally be lumped into three rather flexible groups: well-known, lesser-known and mostly unknown superfruits. Guaraná and açaí, which are now all the

rage around the world, have come to the attention of the largest global beverage makers such as Coca-Cola and Mondelēz.

On 20 May, Amazonas state governor Omar Aziz announced that Coca-Cola intends to produce new beverages based on raw material produced in Brazil’s largest state. According to the governor, Coca-Cola already completed feasibility studies for new products that will be based on Amazon fruits, including açaí.

These studies indicated at least four species that could be used in the manufacturing of juices and the Amazonas state government will now work to give added impetus to the açaí production chain. “Today we are boosting the production segment in order to ensure sufficient raw

material for further processing. This is necessary because Coca-Cola does not produce small quantities. Hence, it is necessary for us to ensure that we have a sufficiently large output that would meet demand of the domestic market,” said Aziz.

According to the governor, the entire production of Codajás municipality has already been contracted and the government of the state is initiating the construction of an açaí pasteurisation industry in the municipality.

The framework deal with

Coca-Cola was reached in 2012, following a visit by representatives

Super-desirableBrazil’s superfruits are much in demand, not least by the soft drinks majors.

CONTINUED ON PAGE 16

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Every great journey starts with one small

step. In such a manner, the T.B. Fruit Group of Companies, a leading producer of juice concentrates in Europe and worldwide, was established as a small business enterprise. Ten years have passed since a tiny seed was planted which grew into a company with a proud name, this year celebrating its achievements.

The T.B. Fruit Group of Companies arose as a result of the incorporation of all the assets of businessman Taras Barshchovsky: Yablunevy dar Ltd, the Polish fruit processing factory; T.B. Fruit Dwikozy Ltd; Tank Trans Ukraine Ltd and Tank Trans Polska Ltd, both of which specialise in national and international transport of liquid cargoes within tank-cars; and the horticultural business T.B. Sad Ltd, which owns 1 000 hectares of apple, cherry, strawberry and raspberry growing land.

In Ukraine, T.B. Fruit Group

owns six plants producing juice concentrates in Kharkov, Khmelnytsk, Vinnytsya and Lviv. The T.B. Fruit Group of Companies is the leading Ukrainian fruits and berries processor, and produces juice concentrates and purées for manufacturers of reconstituted juices. T. B. Fruit holds over 60% market share of the full fruit concentrates production in Ukraine.

In 2011, T.B. Fruit bought T.B. Fruit Dwikozy in Poland and became one of the top five largest juice producers in Europe, billing itself as a producer of NFC juices. Full modernisation and expansion of the plant was achieved in only six months, at a cost of EUR7.0 million (USD9.27 million). It enabled T.B. Fruit to establish itself as a producer of juice concentrates, NFC juices and IQF products.

All T.B. Fruit plants are equipped with modern machinery from Bucher Unipektin. The company also processes biomass into gas so it does not use natural gas in its processing.

In 2012, the company moved into third place among producers of juice concentrates in Europe, put into operation the fourth plant in Ukraine, and started construction of its second plant in Poland. Currently, the T.B. Fruit Group of Companies works closely with companies such as PepsiCo Russia and Ukraine, Coca-Cola Ukraine, Gerber-Emig Group, Wesergold, Riha, Refresco Holding, Niederrhein-Gold, Eckes-Granini Group, Rahal Foods and other European companies. In addition, T.B. Fruit intends to enhance the delivery of its goods to the US and Middle Eastern countries.

According to company data, in 2012 its businesses increased AJC production from that of 2011 to 65 000 tonnes per year. “Taking into consideration the demand and our new capacities, we plan to produce 95 000-100 000 tonnes of juice concentrates in 2013,” said a company spokesman.

The T.B. Fruit Group of Companies is setting up a

new NFC juices and juice concentrates factory in Annopol (Poland) this year. The capacity of its first stage is for up to 15 000 of tonnes of juice per year, with a planned increase to 20 000 tonnes in 2014. In September 2011, the T.B. Fruit Group of Companies released an NFC juices line of five variants under the Galicia trade mark, with a launch investment of about EUR6.0 million.

CorporaTE CElEBraTIonOn 31 May, the T.B. Fruit Group of Companies

Advertising FeAture

T.B. Fruit: a celebration

TB FRUIT gROUP CElEBRATES ITS 10Th ANNIvERSARy

IAN RAhAl CONgRATUlATES ThE OWNER



celebrated its 10th anniversary.On this occasion the company management and Taras Barshchovsky personally received numerous greetings from partners and friends from all over the world. Guests present at the celebration included Gerber-Emig Group, Rahal Foods (USA), Döhler, Refresco, Kumpf GmBH, Pepsico Russia and Ukraine,

Bucher and Concorde Capital Company, International Finance Corporation (IFC), leading banks and local authorities both from Ukraine and Poland. The guests expressed their congratulations, gratitude and wishes for future co-operation. The celebration started with the greetings of Taras Barshchovsky and the showing of a documentary

film about the development of T.B. Fruit Group since 2003.

Guests emphasised their wishes that the company should keep developing its own standards, improving and moving to a new quality level. Striving for perfection in every field of its activity, from production process to relationships with partners, the T.B. Fruit Group cultivates its every initiative

carefully, sowing the seeds of ambitious goals, nurturing them with belief in victory and taking the generous crop of achievements, which today have already become synonymous with the businesses of T.B. Fruit Group of Companies. After all, at the very beginning of its activity the T.B. Fruit Group was founded on the basis of potential for lasting dynamic and sustainable development.

Advertising FeAture

A PRESENT FROM BUChER

BUChER PRESSES

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of the multinational company to fruit processing companies in the regional centres of Benjamin Constant, Carauari, Manacapuru and Manaus.

“The Coca-Cola executives were surprised with the agricultural companies that they visited and they signalled their interest in acquiring processed açaí for the creation of new products by the company,” said Valdelino Cavalcante, director-president of the Amazonas Agency of Sustainable Development (ADS).

Some of the Amazonas companies that were visited last year by Coca-Cola include Açaí Wotura from Benjamin Constant, Açaí Tupã from Carauari, Nat Frutas in Manacapuru and Infrutas and Polpas da Amazônia from Manaus. All of them were instructed to follow standards set by Coca-Cola and to make improvements that would allow

them to sign supply contracts with the multinational.

Coca-Cola mostly requested that the companies make small adjustments, for example in the açaí pasteurisation process. A final audit was due to take place after they take the necessary measures to improve their processes.

Açaí Tupã director Samir Bastos Chagas explained that the partnership with Coca-Cola will ensure much greater employment and revenue for the local açaí processors in Amazonas. “Our production process, which takes place during the day now, could have to be extended to a full 24 hours,” he declared.

Massive demandBrazil’s National Supply Company (CONAB), which recently announced that demand for açaí is particularly strong from the juice and tropical fruit pulp industries, blamed rising

prices on ever stronger demand for açaí. On the other hand, strong foreign interest also means that açaí producers can look forward to more investments and easier processing of the highly perishable berries. “Açaí has an enormous potential but the problem is lack of supply, especially in the off-season,” said Elizabeth Turini, an açaí market expert from CONAB.

Açaí prices at the end of the first quarter of 2013 reached new record highs in Brazil’s Pará state, which accounts for more than 50% of the national açaí output. Producers of açaí in Pará were being paid BRL2.98 (USD1.40) per kg in March, up by almost 50% from the BRL2.08/kg that was paid out in March 2012.

Meanwhile, açaí prices in the second largest producer state of Amazonas amounted to BRL0.81/kg in March, also up from the BRL0.71/kg in March

2012. The minimum price for the crop in Brazil has been set at BRL0.90/kg for the 12-month period between July 2012 and July 2013.

Brazilian açaí producers collected 215 381 tonnes of the fruit in 2011, up by 73.1% from 124 421 tonnes produced in 2010, according to a plant extractivism and forestry production (PEVS) annual survey published by Brazil’s Institute of Geography and Statistics (IBGE) in December 2012.

The three largest açaí producers in 2011 were Pará with 109 345 tonnes, Amazonas with 89 480 tonnes and Maranhão with 12 119 tonnes. Codajás municipality in Amazonas is the largest single producer with 34 421 tonnes in 2011. Data for 2012 is still not available.

While açaí prices are on the rise, guaraná berry prices paid to Brazilian producers at the end of

CONTINUED FROM PAGE 13

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March fell 5.45% to BRL13.0 per kg in Bahia and 3.66% to BRL19.75/kg in Amazonas state, compared with the preceding month. CONAB attributed the decline in prices to lower demand from industry which still had sufficient carry-over reserves from the harvest season.

Brazil is expected to produce 3 731 tonnes of guaraná in 2013, down 4.70% from the 3 915 tonnes harvested last year, according to the latest monthly forecast published by Brazil’s National Institute of Geography and Statistics (IBGE). Bahia will harvest 2 772 tonnes (+3.36%), while production in Amazonas will amount to just 695 tonnes (-27.83%).

Guaraná, a perennial Brazilian favourite, was recently announced as a new flavour of Tang, the fruit-flavoured drink that already has 17 different flavours on sale across Brazil. “Our expectation related to the launch of Tang Guaraná is that consumers will have an excellent acceptance of the new drink, as Tang now offers a flavour that is very agreeable to the palate of Brazilians,” said Théo Dutra Vieira, Tang marketing manager at Mondelēz Brasil.

Tang Guaraná, which is already on sale in the standard 25g Tang packaging, is being marketed as a low-calorie beverage rich in Vitamins A and C.

In a new positive development for the domestic beverages industry, Brazilian authorities slashed the Industrialised Products Tax (IPI) charged on carbonated soft drinks (CSDs) produced with açaí or guaraná seed extracts and fruit juices, after reintroducing the tax in October 2012.

The new IPI tax reduction for beverages based on guaraná and açaí will amount to 50%, while CSDs that contain fruit juices will see their IPI tax cut by 25%, according to new federal government decree no. 8.017 published in the state gazette Diário Oficial da União (DOU) on 20 May.

José Francischinelli, vice president of the Brazilian Association of Soft Drink Manufacturers (ABIR) and director of beverage maker Brasil

Kirin, said the decree will result in a tax break for producers “of around BRL0.05 (USD0.024) per litre of guaraná-based CSD”. One-fifth of Brazil’s CSD market consists of guaraná-based soft drinks, some 30% are made with fruit juices and the remainder is cola-based.

Other superfruitsAs regards less known superfruits such as umbu (Spondias tuberosa), also known as Brazilian plum, which is native to the semi-arid area of north eastern Brazil, production is still not as organised as in the case of açaí or guaraná. Umbu prices have remained unchanged in the key producer states of Bahia and Minas Gerais in April, compared to the preceding month.

The average price of a kilo of umbu in April was BRL0.60 in Bahia and BRL0.40 in Minas Gerais. These prices are 140% higher in Bahia and 33.3% lower in Minas Gerais, compared with prices in October 2012, according to a new report published by CONAB market analyst Martha Helena Gama de Macêdo.

Umbu production in Brazil is still relatively small and harvesting lasts between January and April. Umbu pulp can be manufactured into many different products such as juice, nectars, ice cream and jelly.

Mangaba (Hancornia speciosa), another lesser-known superfruit native to Brazil, and used in the production of juices, ice creams, sweets and a

wine-like beverage, is highly appreciated in the Brazilian northeast. The biggest producer of the fruit is the state of Sergipe, where it is primarily in demand in the form of concentrated pulp and ice cream.

Mangaba fruit producer prices in Sergipe were BRL2.43 per kg in April, down from BRL2.65 in the preceding month and unchanged from April 2012, according to CONAB’s new report on the Mangaba market published in May. Mangaba is harvested between December and June in Sergipe, while Bahia and Minas Gerais are also large producers.

In addition to its alluring flavour, mangaba also has some unexpected benefits. In 2010, researchers from the University of Minas Gerais published research results indicating that mangaba tea was more efficient in regulating high-blood pressure than some leading blood pressure medications available in the market.

Fortunately for the beverages industry, the list of superfruits is growing longer by the year. Brazilian researchers are already feverishly working to shine the spotlight on more obscure fruits that have export potential and at least as many functional properties as their better known counterparts. The first step is to ensure that all new superfruit candidates are well investigated, without which it is impossible to organise larger scale production and determine the best processing

methods. Most of this initial research in

Brazil is conducted by academia or state-run agricultural research companies such as Embrapa, which have the resources to conduct the lengthy research needed in order to describe these somewhat esoteric fruit species in detail.

For example, researchers at the University of São Paulo (USP) announced in late May that they successfully determined the ideal harvesting time and storage temperatures for three new superfruit candidates: camu-camu (Myrciaria dubia), bacupari (Garcinia gardneriana) and abiu (Pouteria caimito).

“Camu-camu was selected as the flagship species for the project, as it is a species well-known for its large content of Vitamin C. The level of ascorbic acid present in this fruit is as much as 150 times greater than in oranges. Furthermore, it is rich in anthocyanins, a pigment class that it is well-known for its anti-oxidant traits,” said USP researcher Patrícia Maria Pinto.

Bacupari was chosen for the study because it is rich in carotenoids and contains active ingredients with bactericidal properties, while abiu – in addition to being very tasty – is rich in Vitamins A, B and C, as well as calcium and phosphorus.

“These are fruits that have not been studied extensively: they are commercialised on a small scale in the country and have an export potential,” said Maria Pinto. She added that researchers discovered that camu-camu and abiu can be harvested 15 days prior to full ripeness.

“The ideal point for camu-camu is when its skin is red-greenish, while abiu reaches the same point when its skin is green-yellow,” said Pinto. Bacupari, on the other hand, needs to be harvested when it is ripe, when its skin is orange coloured.

Abiu and bacupari can be stored at 10ºC for more than 15 days without suffering any adverse effects, while camu-camu can be stored at 5ºC for the same period also without any loss or damage to the fruit.

MANGABA IS A LESS-KNOWN SUPERFRUIT FROM BRAzIL



BY NEIL MURRAY

PINEAPPLE juice concentrate (PJC) has lost its appeal over the last few years. Demand in Europe has slumped, despite the fact that Thailand had a bumper pineapple harvest a couple of years ago. This, and the generally lacklustre demand, propelled PJC prices to their lowest level in years. And still nobody was interested in the product.

Now, at last, demand is starting to rise for pineapple juice. FOOD-NEWS editor Neil Murray talks to Ganyapad (Jinny) Tantipipatpong, director of Tipco subsidiar, Siam Agro-Food Industry Co (SAICO).

Why has demand for pineapple juice fallen so much? Especially when it is currently so cheap?It was expensive: the PJC price was high a couple of years ago. When I talk to a lot of customers, they all say the same things. They blame it on the weather, the economy, and a lot of reformulation for cheaper products. A couple of years ago, all juice ingredients were expensive. Orange juice was way up there. AJC was way up there.

I was in the UK a couple of years ago and everyone was excited by Trop50 – this used to

be a premium product, but it’s juice diluted with water! The price of PJC is now USD950-1 200 per tonne fob, depending on the type contract. Consumption is low and demand is too low so it may take a while to push the supply.

What can be done to stimulate demand, especially in Europe?Domestic consumption is shrinking in Europe. We rely on one market. Europe has been a very big market for Thailand but when the economy goes bad, we have to find a way of increasing demand in other markets. The Middle East is doing OK: demand in the Middle East is still strong.

What are the advantages and disadvantages of buying PJC from other countries such as Indonesia and the Philippines?It’s only a price advantage. I don’t think we have any quality differences. The Philippines say they do some MD2, but when we open their cans we don’t see any. The Philippines has always been a bigger supplier to US because of the presence of Dole and Del Monte.

What stocks of PJC are currently held in Thailand?It is very difficult to say because we don’t really have an industry

figure. I think the inventory is probably on high side because consumption is down but I don’t have the figures.

People think of Costa Rica when they think of NFC pineapple juice. Is this a market that Thai-land could usefully penetrate?I think we have increased NFC production. We are exporting more from Thailand but in terms of quality, MD2 probably tastes better than Cayenne NFC. Also, MD2 tastes better as fresh than as concentrate. Bottlers will buy from two origins and blend – there

are times when Costa Rica’s ratio is higher.

Which is the greatest concern: inflation, the exchange rate, or rising labour costs?Actually, today it’s the exchange rate. We have seen a 10% devalu-ation of the dollar in a year. What we look at is our competitiveness with our neighbouring countries: the Philippines and Indonesia.

Thailand had a financial crisis in 1997 and devalued. Indonesia devalued in 1998. The Thai baht is the strongest currency in the region so we have to become even

Pineapple resurgencePineapple juice looks like becoming profitable again.

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more efficient and productive to compete with low cost countries such as Indonesia. The inflation rate in Thailand is about 4%.

What Asian markets could con-ceivably make up for the loss of demand in the EU and US?Who can pay? When we were looking at China 10 years ago, we thought China would flood the world with its products but China is sucking everything in. China will be an important market.

We have a Free Trade Agree-ment with the ASEAN countries and China. Labour costs in China have increased quite quickly. People move to the cities, and they don’t want to work in the food industry any more. China has more potential to develop hi-tech products. I don’t think Thailand has the potential for this, but it has a lot of agro-industrial potential. Labour costs are higher than in China, but in terms of efficiency we are better than China. Food safety is another issue.

What changes are you seeing in weather patterns?It has been very hot this year. It

will probably continue to be hot. It has also been very dry. But in 2011, we had very heavy rain and big floods in Thailand.

We also try to anticipate the El Niño and La Niña cycles. But this year has been very dry and we expect the crop to be down 30%.

Are there any changes in

customers’ packing and shipping demands?The trend will be to something reusable: returnable or reusable. I don’t know what customers do with their old drums. I know some bottlers are demanding packing in IBC bins.

Will Thailand try and grow MD2 or will it always grow Cayenne?

MD2, as I understand is more suitable for fresh consumption, so most fresh pineapple in Europe is from MD2.

For the fresh market, you have to be more particular in quality, but not everything from the fields is 100% good, so you still have something for processing. But MD2 really does not grow well in Thailand.

http://www.kronos.com.gr



BY ULRICH vON DER LINDEN

CHINESE apple juice concentrate (AJC), Thai, Indonesian and Philippine pineapple juice concentrate (PJC) and Indian mango purée and concentrate three key juice products which form the basis for trade between Asian countries.

Looking at the market share of Chinese AJC Exports and EU-27 imports of AJC (see chart), one can see the effect of prohibitively high duties in EU (25.5%) on Chinese product in combination with a strong competition arising from other countries, such as Turkey, Moldova and Ukraine). In 2012, for the very first time, Turkey sold more AJC to EU-27 than China.

Analysing the pie chart, we see that the US and Canada account for more than 50% of Chinese total AJC exports. Japan and Russia are the major Intra-Asian destinations with a joint share of 20% of total exports.

China’s dilemma involves experiencing a downturn in exports to Europe on one hand and depending on the US and Canadian markets on the other. Due to emerging competition from eastern Europe, namely Moldova and Ukraine, exports in general will probably suffer in the future.

When will these countries start to export significant volumes to the US? It is purely a matter of time.

The market for pineapple juice concentrate (PJC) is more fragmented than AJC. The intra-Asian exports of the three main

PJC processing countries in Asia (Thailand, Philippines and Indonesia) have been steadily growing, as you can see in the charts here.

In 2012, intra-Asian PJC imports, added up to a total of 30 000 tonnes and trade figures indicated that Asia’s main import regions were:

Japan: share of total intra-Asian imports (IAI): 16.7%; Saudi Arabia: share of total IAI: 13.2%; Iran: share of total IAI: 11.3%; Taiwan: share of total IAI: 11.1%; Hong Kong: share of total IAI: 10.9%; Singapore: share of total IAI: 9.2%

Last but certainly not least, intra-Asian trades of Indian mango purée and concentrate (MGP) play a decisive role, given the fact that in 2012 they accounted for more than 60% of Indian global mango purée

Sharing and swappingIn Asia, there is a surprising amount of secondary trade. Major fruit juice producers are no longer relying on Europe and the US.

INTRA-ASIAN ExPORTS OF PHILIPPINE PJC (2007-2012)

Saudi Arabia, 30%

Netherlands, 11%

Yemen, 12%UAE, 8%

Kuwait, 6%

UK, 4%

US, 3%

Lebanon, 2%

Japan, 2%China, 2%

Canada, 2%

Egypt, 2%

Sudan, 2%

Others, 14%

INDIAN ExPORTS OF MANGO PULP SHARE IN % (2012)

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exports. Unsurprisingly, Arab countries take more than 50% of total Indian MGP exports.

Changing the perspective from exports to imports, the most important juice being imported into Asia is Brazilian FCOJ.

Japan and China were the major Asian destinations. In 2012, China imported more than 56 000 tonnes of FCOJ, out of which approximately 45 000 tonnes came from Brazil, 10 000 tonnes from Israel and a very small quantity from the US.

To sum up, the charts demonstrate the growth of intra-Asian business in the selected areas. Confronted with stagnant markets in Europe and US, Asian juice exporters are looking for alternatives within their region. However, the sizes and structures of individual markets differ

significantly one from each other.Imports of FCOJ have been

highlighted as one of the major products. Japan and China are the

most important Asian importers. ‘Real’ two-way businesses between countries are still at an embryonic stage.

For example, China imports FCOJ from the US and exports AJC to this destination. India imports AJC from China and exports mango purée and concentrate to Japan.

The future will tell us whether the development seen for AJC, PJC and purée and concentrate in 2007-12 is really going to establish a basis for a solid, long-term trend.

Such an evolution would be absolutely desirable, not just for individual countries and markets but for the global market in toto.

INTRA-ASIAN ExPORTS OF PHILIPPINE PJC IN MT (2007-2012)

“To sum up, the charts demonstrate the growth

of intra-Asian business in the selected areas.

Confronted with stagnant markets in Europe and US,

Asian juice exporters are looking for alternatives

within their region.”

SOURCE: Philippine National Statistics Office, Jan-Oct

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BY JAN HERMANS

LURDES SOARES

MILICA JEvTIC

HISTORICALLY, imports of fruit purée concentrates used by the blending sector have been classified to commodity code (CN) heading 20.08 by virtue of an explanatory note included under CN heading 20.07 which read:

“This heading does not include fruit purées obtained by sieving then brought to the boil in a vacuum, the texture and chemical composition of which have not been changed by the heat treatment (heading 2008)”.

On 2 June 2012, the European Commission enacted legislation that eliminated the exemption above-mentioned and thus fruit purées concentrates were re-classified from 20.08 to 20.07. The consequence of that change was that since its implementation (02/06/2012) rates of customs duties substantially increase up to a maximum of 24% and an additional agricultural levy based on sugar content was introduced.

The net effect of the classification change was estimated by AIJN to represent an additional cost to the European industry in terms of combined duty and agricultural levy of approximately EUR20-25 million annually.

In an attempt to temporarily reverse the harmful consequences of such change, AIJN submitted, on behalf of its members, a formal application for tariff suspensions for concentrated fruit purées. The application covered tropical and non-tropical fruit purée concentrates, and the underlying request was that the duties for such products imposed under CN 20.07 were reduced to the limits applied before the change (i.e., as under CN 20.08).

The application was evaluated and discussed by the European Tariff Questions Group (ETQG)

a group comprising different services of the European Commission and Experts from each member state, which decided to propose partial tariff suspensions for five tropical fruit purée concentrates: mango, acerola, banana, guava and papaya (purée concentrates such as apricot and peach, also included in the application, were withdrawn due to strong opposition from the European Commission and some member states, to protect growers of non-tropical fruit in southern Europe). The proposal was approved by the European Council on 22 May and will enter into force on 1 July 2013.

Evaluation EU tariff suspensions scheme Beginning of 2013, the Directorate General of Taxation and Customs Union commissioned an evaluation of the EU tariff suspensions scheme, to which AIJN has been invited to participate. The objective is to assess both the process of the current scheme (i.e: the way in which the system is implemented) and its impacts (primarily on EU businesses, but also on third country producers and the leverage of the EU in international trade negotiations).

In broad terms, AIJN supports the principle of suspending customs tariffs when it can be shown that the net economic benefit of suspending a tariff is greater than the net economic cost of retaining it, but the current procedure is flawed and fails to deliver the maximum benefits to the EU’s economy.

More AIJN activities During 2011 and 2012, the AIJN intensively worked on a review of the ‘AIJN Hygiene Code’. This document aims to offer state of the art guidance for food business operators active in the production of fruit and vegetable juices and similar products to help them produce and put on the

market safe products, and at the same time fulfill the regulatory obligations embedded in the EU legislation.

The review is divided in two parts: part A is dedicated to Good Manufacturing Practices and part B to Hazards in fruit and vegetable juice industry; it was published in December 2012, under the new title ‘Guide to Good Hygiene Practices in the Juice Industry’.

Also new is the ‘AIJN Guideline for Vegetable Juices and Nectars’. The aim of this guidance is to promote a clearer and harmonised understanding concerning the production of vegetable juices and nectars. Besides a strong focus on industry agreed definitions, it contains information on ingredients, treatments and substances authorised in such products as well as on minimum vegetable content for nectars.

Another recent accomplishment is the ‘AIJN Good Laboratory Practice Check-List’. This document was developed with the intention of being used as an internal working tool to improve operations in factory laboratories and to avoid bad practice. The Check-List is clearly not a substitute for existing certification standards and legislation but can prove a valid tool to assist laboratory managers verifying if their laboratories comply with certain requirements which are generally considered to be essential for the proper functioning of small factory laboratories.

AIJN is also active in following the activities of the Codex Alimentarius. With respect to the recent session of the Codex Committee on Food Contaminants (CCFC) (Moscow, 8-12 April), where a reduction of the maximum level of lead in fruit juices from 50 parts per billion (ppb) to 30 ppb was going to be proposed, AIJN advocated that different maximum values should be established for fruit

Tariff confusion

“In broad terms, AIJN supports the principle of suspending customs tariffs when it can be shown that the net economic benefit of suspending a tariff is greater than the net economic cost of retaining it, but the current procedure is flawed and fails to deliver the maximum benefits to the EU’s economy.”

The AIJN talks us through the recent mess made by the EU of tariffs on tropical juice purées, and other progress made by the AIJN.


juices from big fruits and juices from small fruits and berries (for which the current maximum level of 50 ppb should be maintained). This proposal was taken on board by the European Union and gathered the necessary support from the other members present in the last CCFC session.

Country of Origin Labelling (COOL)According to the current labelling rules in the new Regulation (EU) 1169/2011 on the provision of food information to consumers, country of origin labelling for fruit juices and nectars remains voluntary.

However, this same Regulation obliges the European Commission to issue by 13 December 2014 a report on COOL for, among others, single-ingredient products and ingredients representing more than 50% of a food. As there is no clear definition yet for the term ‘single-ingredient products’, it is not sure that single fruit juices and nectars would qualify for this category of products. Nevertheless, it seems that a vast majority of

fruit juices and nectars would be in the case of having an ingredient representing more than 50% of a food, which is why COOL might become a reality for our products. AIJN is thus aware of the importance of industry contribution to discussions around this Commission report. Some of AIJN members committed to carry-out a case study within their companies for some main products of the sector to identify all the changes and additional costs such labelling obligation would introduce. It is to be noted that this will be a highly political debate, which is why the industry needs to be reflecting upon a possible form of origin labelling that would be suitable for the sector (declaring the continent, the region, etc.)

Corporate Social Responsibility (CSR)AIJN is this year launching a project entitled Fruit Juice CSR Platform together with AZTI Tecnalia, IDH – Dutch Sustainable Trade Initiative, UTZ Certified and Sociability. The project is co-funded by the European Commission as it is part of the renewed EU strategy

2011-2014 for CSR that focuses, amongst others, on development of industry sector CSR platforms.

Specific objectives of this project are to provide a platform for stakeholders to identify and discuss CSR related challenges facing the fruit juice sector, encourage much more companies to take a strategic approach to social responsibility, and give greater visibility to CSR activities already in place. A set of seminars/workshops will be organised in order to first gain insight in the newest trends for CSR, then train suppliers in the field of social and environmental sustainability, and facilitate the exchange of best practice. In addition, an interactive website featuring examples of best CSR practice will be created to serve for internal communication within the sector, but also to promote the industry as such and its CSR solutions towards other stakeholders such as distributers, consumers, NGO’s, institutions etc. The kick-off event of the project will be the First Platform Seminar organised on 3 October 2013 in Brussels as a post Juice Summit event.

“According to the current labelling rules in the new

Regulation (EU) 1169/2011, country of

origin labelling for fruit juices and nectars remains voluntary.

however, this same Regulation obliges the

European Commission to issue by 13 December 2014 a report on COOl

for, among others, single-ingredient products and ingredients representing

more than 50% of a food.”

http://www.couecou.fr



BY NEIL MURRAY

THE coming season, and next year, are both going to be critical for the global supply of FCOJ and AJC. Right now, FCOJ prices are at historic highs while AJC prices from China are, into Europe with its 25.5% duty, hopelessly uncom-petitive.

The FCOJ futures market has been less volatile this year than it was last (with the carbendazim problem), but for much of the last couple of years, excluding occa-sions such as the carbendazim scare, the futures price has been higher than the physical price. Sometimes far higher.

At the time of writing, the orange juice futures price is just short of USD1.50 per pound, equivalent to USD2 135 per tonne, and the Brazilian price for FCOJ is around USD2 350/tonne cfr duty unpaid Rotterdam, so the price gap has narrowed. But it is still there.

There are several big influences on orange juice production, demand and pricing right now. First, harvests are going to be down in both Brazil and Florida. Quite how big the reduction will be remains to be seen: the USDA forecasts for Florida have consis-tently downgraded the harvest prospects, but not by massive quantities. Brazil is different: the harvest is going to be considerably smaller, although two official bodies in the country still disagree over exactly how much smaller it will be. So there will be fewer oranges to turn into juice, and reduced juice supply.

Next is the problem with poor returns to farmers. Brazilian orange growers are almost mutinous: about one-third of the country’s processing oranges are now grown by the vertically integrated proces-sors, which has reduced the amount of fruit they can supply, and right now, the orange price is extremely low, following large production (and low demand, but we shall return to that). Farmers are giving up citrus growing in favour of

sugarcane or maize, for biofuels. Once an orange grove is uprooted, it is effectively out of production for the foreseeable future. It can be replanted but it will still take six years before it starts producing viable quantities of fruit. So this is turning into a long-term issue.

Next, again, is the problem of disease. Greening is rampant. Research into curbing and eradicat-ing the disease is under way in both the US and Brazil, and it seems likely that the industry will find a solution, but again for the foreseeable future, there is going to be a serious effect on orange production.

Then there is the problem of Brazilian costs. Fruit may be cheap, but steel, energy and (espe-cially) labour certainly is not, and the processors contend (with some justification) that they cannot control these costs. Nor can they do much about the strength of the Brazilian real. Brazil’s economy is booming and a rising currency is one of the results. And this has an adverse effect on labour costs as well, since every tonne of juice that you sell earns you fewer dollars, and you have to pay your labour force in reais.

Against this must be set the huge Brazilian inventory of unsold FCOJ: something like a year’s supply. In theory, this should have a disastrous effect on pricing: you would want to get rid of such a large stock rather than continue to fund storing it. After all, look at what happened a few years ago when China found itself holding hundreds of thousands of tonnes of unsold apple juice, and look at the situation with cranberry juice right now. But Brazil’s processors are effectively being supported by the country’s government, and they can take a more sanguine long-term view.

And then there is demand, or the lack of it. For FCOJ, this is stagnant in North America and Europe, the two largest markets. Rabobank has just published a report predicting that by 2020, American and European demand

for FCOJ will have fallen to about 1.1 million tonnes, compared with 1.5 million tonnes in 2007. Yes, demand for NFC orange juice has stayed high in Europe – it is about the only thing that is keeping the Brazilian processors in business, and the difference between the FCOJ and NFC markets can be illustrated by the fact that custom-ers enquiring about NFC juice have been told that they can indeed buy some, but only if they take a quan-tity of FCOJ with it.

American retail sales continue to sag. Earlier this year, the USDA predicted that US retail sales would recover this year. FOODNEWS was sceptical, and said so, citing some of the above reasons, and remains so. Now the best hope is that retail sales will remain at or fractionally above last season’s levels.

True, there are new markets opening up in China and else-where, but Chinese demand is still relatively small and the Chinese are only really interested in the cheapest low quality juice, because it is almost all destined for soft drinks manufacture rather than for consumption as ‘drinking juice’.

And, in a move whose impor-tance seems to have been overlooked, China has elevated its indigenous citrus industry (after it failed to live up to the expectations announced six or seven years ago) to a level of unprecedented national importance, by including it in the next national Five Year Plan. This means that the entire industry, from farmers to shippers of finished product, will benefit from special levels of state support and funding, and it will be much more difficult for foreign processors to set up in China. The whole idea is to make China less dependent on imports.

So where will this leave FCOJ and its pricing next year? Funda-mentally, there seems to be no reason for Brazil to cut its prices. It has stock which it can release pro-gressively as the effects of lower production filter through, and for the next few years at least, China will need Brazilian FCOJ.

The Big Ones

“China has elevated its indigenous citrus industry to a level of unprecedented national importance, by including it in the next national Five year Plan. This means that the entire industry will benefit from special levels of state support and funding, and it will be much more difficult for foreign processors to set up in China.”

The two biggest fruit juices, FCOJ and AJC, are both dogged by excessive carry-over stocks. What does the rest of this year hold in store?


FOODNEWS does not expect deep cuts in Brazilian FCOJ prices.

And so to apple juice. The issue here is not necessarily one of over-supply or under-supply: it is that China has lost the European market (even Moldova exported more AJC to Europe last year than did China) and stands little chance of recovering lost ground unless there is a sudden upsurge in demand for AJC (possibly initiated by huge harvests and an abun-dance of cheap raw material) or unless the EU lifts the 25.5% duty it imposes on imported Chinese AJC.

As with FCOJ, demand for AJC is low. And China cannot consume more than a small frac-tion of its production itself, because apple is just not a popular flavour in China, which means that concentrate is largely confined to use as a base in juice drinks or blends.

Chinese exports to the US have been reasonably buoyant this season, at least compared with sales elsewhere, not least because China slashed its prices to around USD1 150/tonne in an attempt to

clear stocks. When it became clear that even price cuts were not going to increase demand (FOOD-NEWS strongly suspects that much of this cheap juice was simply bought because nobody can resist a bargain, and is now stored in the US for future consumption), China raised its prices again.

What happened in the US showed that China can be compet-itive. In Europe, last year, its

product (with duty added) was much more expensive than Euro-pean or South American juice. This year, Poland was able to offer very enticing prices after its huge 2012 harvest. This has compli-cated matters for Chile and other suppliers, because not only have they had to compete against Poland, but China also managed to lower its prices this year. Just not enough…

So Chile and Poland followed last year’s pricing strategy of looking at the Chinese price, adding the duty and other costs, and then pitching their product at exactly the same level, or fraction-ally under it. The chart accompanying this article shows this precisely. According to Customs figures, Polish AJC, ex Rotterdam, is priced within a few

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AJC PRICES CFR ROTTERDAM JANUARY-FEBRUARY (USD/TONNE)

CONTINUED ON PAGE 26

SOURCE: FOODNEWS

http://www.chbjuices.com



BY NEIL MURRAY

INDIAN mango production has been steadily increasing for the last two decades. In that time, output has nearly doubled: it is one of the few fruits to show such a growth rate.

Although mangosteens and guava are included in the category, mango is by far the dominant fruit. Sources in India reckon that mango itself accounts for 14 million tonnes of the total.

India still has to compete with product from (chiefly) Latin America, and while suppliers in countries such as Colombia and Peru enjoy a duty advantage, their production is but a fraction of India’s output and, moreover, they are always following India rather than setting the pace. By and large, India is cheaper than Latin America for processed mango, and Latin America has to wait for years when harvest problems push India’s price up.

Also, Indian mango, especially the premium Alphonso type, have a flavor profile that is prized by expatriate Indians in Europe and the Middle East, and nothing else will really do. Latin America has the premium Chato da Ica, and this and other varieties sell well in the US and parts of Europe.

At the recent Juice Asia conference, Ranjan Kedia of Radhakrishna Impex, one of India’s major mango purée exporters, outlined exactly where India’s industry stands now.

The figures for 2012/13 show that the vast majority of Indian mango (89%) is consumed fresh. Just 1% is exported fresh. Other forms of traditional processing take 1%. Then 5% is used by the country’s vast pickles industry, and 2% is taken by the domestic purée and concentrate industry. Just 1% is destined for purée and concentrate intended for export.

However, this is forecast to change. Indian domestic fresh consumption is predicted to take 87% by 2020, while traditional processing and the domestic beverage industry will both take 5%. Fresh exports and purée and concentrate for export will remain at their present levels of 1%. This is not all bad news, as Indian mango output is forecast, said Kedia, by 4% year-on-year, so the actual volumes for all forms of consumption will increase.

This year is being seen as a normal year for the crop with good production, and no major disruption on the processing varieties, although Alphonso output has definitely suffered.

Demand from African countries is still robust, despite growth in local production and processing. There has been better demand from Europe during the first quarter of this year (probably due to the exhaustion of Totapuri concentrate stocks), and this is expected to continue. Russia and other CIS countries have increased their import of mango pulp consistently over the last three years.

Demand is also strong from the Middle East. The key factor here is quick despatch of new crop product, to be in time for Ramadan in July (known as Ramzaan in Asian countries).

The outlook for India this year is reasonably buoyant: carry-over

stocks have been eliminated, and prices are rather higher than expected. However, the problem of duty on Indian product persists (see the AIJN article on page 22 for more detail on this) and the door may well be open to lower-priced product from Latin America this year.

The growth of mango

“The outlook for India this year is reasonably buoyant:

carry-over stocks have been eliminated, and

prices are rather higher than expected. however,

the problem of duty on Indian product persists.”

dollars per tonne of imported Chilean product and (once duty and port charges are included) Chinese. The average Chinese price was USD1 450/tonne, c&f, but exclusive of port charges and duty, which have been added in by FOODNEWS. As one contact said, this shows that AJC is start-ing to metamorphose into a global commodity, whereas previously there had been considerable varia-tion in specification and price between different supplying coun-tries. There are still some difference: Chinese, South

American and Turkish product is still sweeter, on average, than Polish, for example, but even this is changing as Chinese average acidity increases and Polish falls.

Turkish AJC, by the way, looks rather more expensive because it was. Turkey priced its AJC too high for it to be really competitive this season.

What will happen next year is hard to predict. What is certain is that Chinese AJC production will be totally dependent on fresh market demand, and as China’s distribution infrastructure improves, this means that fresh

fruit will be available to more and more of China’s 1.2 billion people. It seems unlikely, even though China’s apple output con-tinues to increase, that there will be massively more raw material available for making AJC.

So Chinese AJC is likely to stay at its present levels, or even increase. There is massive over-capacity in the AJC industry there, but as yet no plants appear to have been closed or even moth-balled. Instead, they are processing in fits and starts as fruit becomes available, and this is not how they were designed to

function.In Europe, Poland may see a

reduced apple harvest after last season’s 3.2-3.2 million tonne bonanza. However, because of the cold winter, the outlook for Euro-pean apples generally looks good. For Latin America, it is way too early to speculate.

Everything really depends on demand. Assuming no pre-harvest disasters, FOODNEWS’ best pre-diction is for a modest increase in AJC prices next year, based on a slight rise in demand and moder-ately constrained supplies after this recent bountiful season.

CONTINUED FROM PAGE 25

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INDIAN MANGO PRODUCTION (TONNES)

SOURCE: FAO (includes mangosteens and guavas)

Mango products can probably rely on a consistent raw material supply.

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