Orange oil is extracted by simple pressure from the outer coloured part of the Citrus sinensis' peel. Oranges are widely cultivated in tropical and subtropical climates for the sweet fruit and commercially for essential oil extraction.
Orange oil is a by-product of the juice industry. Oil is cold pressed from the peel of the fruit, after juice extraction and is widely used across the flavour and fragrance industry. Sweet orange (citrus sinensis) is around 90% d’limonene, a product used across many more industries. Approximately 40% of global oranges are processed for juice and oil with 60% solely used as a fresh fruit for consumption.
Brazil has the largest production of fresh oranges and also it processes more orange than any other country making it the largest producer of orange oil and d’limonene (orange terpenes) in the world. Harvesting can be almost 12 months of the year due to the widespread distribution of plantations, however it is unusual for any significant production during February – April. Therefore we usually consider May - December as a typical harvesting period.
Brazilian oranges make up for around 34% of the world market – approximately 17 million tons+/- from a global estimate of 50 million tons +/- of fresh fruit. The Brazilian state of São Paulo contributes around 80% of the country’s production figures.
It's been a challenging time of late for the world's largest producing country and they're forecasting a sharp reduction of 18.3% in the total 2016/17 crop. To read more about today's conditions click here.
You may have recently read in our Market reports details of the challenges faced by the industry due to Citrus Greening. Click here for more details of the global impact of this wide spreading disease.
According to Fundecitrus, the 2021-2022 orange crop forecast update for the state of São Paulo and the western Minas Gerais citrus belt is 267.87 million boxes of 40.8 kg each. This represents an 8.9% reduction from the previous estimate in May of 294.17 million boxes. These lower figures bring the crop forecast to be about the same as the last crop, which ended at 268.63 million boxes, even though it should have been a better crop due to the alternate bearing phenomenon. But because of continuing drought conditions, which has reduced the moisture level in the soil and caused low water levels in rivers, lakes and reservoirs in what is considered the worst water crisis in 91 years, combined with successive frosts in June and July, the larger crop will not come to fruition.
These unfavourable weather conditions have caused a decrease in the quality of the oranges, since some of the fruits affected by the frosts are dry and crystallised in the inside; a significant reduction in the amount of fruits per trees; the fruits to be smaller and weigh less than the usual oranges resulting in a smaller number of boxes produced; and the highest drop rates of oranges ever seen in recent history. In view of this data and the perspective of climate conditions remaining adverse until harvests end, fruit should present the most critical size and drop rate in historical data. All varieties considered, the average size projected in May 2021, of 259 fruits to fill a 40.8 kg box, which corresponds to an average orange weight of 157.5 grams, is now updated to 283 fruits per box, equivalent to a weight of 144.2 grams per fruit, which is 14.7% lower than that of the last five crop seasons. The projected fruit drop rate increases from 20.5% to 20.9% average, all varieties considered, due to the intense water deficit, frosts and the pressure of pests and diseases, all affecting the physiological activities of orange trees.
Brazil : Citrus Belt Orange Crop Forecast by Variety
The lower crop size has triggered price increases for orange oil, terpenes and d’limonene and all other products generated during the processing of oranges. The supply is limited and lower than expected and demand is on the increase. The prediction is that price will continue to increase and a price release is not expected until March 2023. Moreover, in August 2021, the United States Environmental Protection Agency (EPA) released a final rule revoking all “tolerances” for chlorpyrifos, which establish an amount of a pesticide that is allowed in food. This is causing many quality control rejections, and thus making a difficult situation even worse. According to growers, chlorpyrifos will remain in the trees for at least 2 to 3 years.
It is too early for a 2022-2023 orange crop forecast, but considering it will be an “off” year according to the alternate bearing phenomenon cycle, and the extreme adverse weather conditions which may affect the fruit setting for the new crop, together with a late start for the next crop, as blooming has not fully started yet, a potential crop of 300 million boxes is expected.
Brazil Citrus Belt : Orange Production 1989/90 to 2022/23 (million boxes )
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