In this article we have a look at what is happening with the tomato prices in the United Kingdom, the Netherlands, Belgium, Germany, Poland, Italy, France, Spain, Turkey, Russia, Israel, Jordan, Pakistan, Australia, Japan, the United States, the Dominican Republic, Mexico and China.
British tomato prices under pressure
Tomato prices at all major British retailers are under pressure. Since the start of 2016, prices have recorded a slight downward trend. Most tomatoes at retail stores are imported from Spain. Only Asda offered Moroccan tomatoes in late February.
Dutch prices "not bad"
The import season is coming to its end. Good import tomatoes are difficult to find, according to a trader. The domestic production is gradually taking the market over again. Thanks to the lighting equipment, Dutch tomatoes are available all year round. All varieties of Dutch tomatoes generate more than the imports from Spain.
The Dutch production has fallen slightly in the past year. After years of growth, the tomato acreage reached its peak in 2014, according to CBS, with 1,780 hectares. In 2015, it dropped to 1,750 hectares. The overall growth in recent years has been mainly the result of an increase in the acreage of truss tomatoes: from 940 hectares in 2005 to 1,260 hectares in 2015. The Dutch tomato sector has been developing slowly, but constantly, over the past years. On Agriport A7, in North Holland, a number of tomato producing companies have been expanding with farms of up to 100 hectares. When the crisis hit horticulture, the construction of new facilities virtually stopped, but that did not apply to these companies. The ground was already paid for, and the financing was based mostly on these expansions. These developments are reflected in the sector's figures, where economies of scale play an important role. The average farm in 2005 had a size of 2.9 hectares; an acreage which has now doubled to 5.8 hectares.
Tomato imports from Morocco generate good returns of around 7 euros. Specialties are doing well. In any case, these good prices, cannot compensate for the losses suffered by Moroccan growers this season, as reported by a trader.
Belgium: more specialties
For the past ten days, the tomato market has been getting back to its feet and prices currently stand at around 1.60 euros. So far, the outlook for the Belgian season is positive. The supply from southern Europe is lower and prices are going up. In recent times, there has been increased demand for specialties. The demand for cherry tomatoes surpasses that of regular tomatoes, reports a trader. The cultivation is increasingly focusing in the specialties, which had a positive impact on the market last year. This season, prospects are just as good.
German season kicks off
The lower temperatures in Spain have taken a toll on the German wholesale market. Last week, traders reported that there is enough product available to meet the demand, but that they also expect the supply to fall in the coming weeks. Besides the Spanish production, there is a growing availability of Moroccan tomatoes. The North African country exports mostly small truss tomatoes. Moreover, Belgian and Dutch tomatoes are also expected.
On the Hamburg wholesale market, it has been reported that prices for beef tomatoes have increased because of the small supply, while in other cities the price has fallen due to a large supply from Spain, Belgium and Turkey. Cherry tomatoes are mainly imported from Italy, the Netherlands and Spain. Last year, 90,000 tonnes of tomatoes were harvested. The German season is expected to kick off on 20 March.
Local production doing well on Polish market
The Polish market is showing positive signs for Polish growers. The products are reaching better prices on the domestic market and there is high demand for good quality Polish tomatoes. Due to the lack of sunlight in recent weeks, production has decreased by 20 percent, and in February alone it fell by between 15 and 30 percent. The export of regular, cherry and plum tomatoes will start from week 18. A Polish producer and trader explains that their acreage has been expanded to 16 hectares; with this, the Polish company hopes to be able to export to Western Europe.
Italy: stable low prices
Due to the mild winter, the tomato season has been advanced by ten days. This also resulted in a greater harvest, which has kept prices low. Italian traders believe that the adherence to the agreement between the European Commission and countries in North Africa, particularly Morocco, on the import of tomatoes is poorly monitored. Traders do not feel protected by the measure. Furthermore, Italian traders are observing a greater presence of Turkish tomatoes on the market; a product which would have previously been exported to Russia.
Italian growers are thereby seeing a great loss in revenue. In Ragusa, greenhouse-grown cherry tomatoes generate 90 cents per kilo. Since mid-December, the average price on the wholesale market in Sicily stands at 60 cents per kilo. The market fears the price drops traditionally recorded in April.
The French are paying for quality
Although cherry tomatoes are still doing well in France, a big grower is starting to focus on the larger Marmot variety. This tomato was launched on the market in April last year in three colours: red, yellow and greenish. French consumers are willing to pay more for quality products. This applies also to exports from the UK, Spain and Belgium.
Spain: lower acreage, smaller volume
It has been a tough year for growers and traders. The period between December and February was especially tough, coinciding with a drop in both production and calibres. At present, prices for on the vine tomatoes range between 80 and 90 cents per kilo. Daniela tomatoes yield between 90 cents and 1 euro per kilo. Cultivation in Almeria has slowed down due to the lower temperatures. Furthermore, the acreage has been reduced by between 20 and 30 percent. Many growers have switched to watermelons after the good results this product achieved last year. Sizes are also smaller.
The sector expects prices to increase at Easter; a time when the best prices of the season should be recorded. Meanwhile, the harvest is starting in northern countries such as France, Belgium and the Netherlands, which will entail an increase in competition.
Turkish exporters looking for opportunities in Europe
The Russian boycott is forcing Turkish exporters to seek alternative markets for their tomatoes. Traders are looking for opportunities in Eastern Europe, where they see a lot of potential. "Prices are low this season, that is why we are able to supply European countries which used to make their imports from other countries," explains a trader. Poland, for instance, is interested in Turkish tomatoes, because the country is unable to cover the demand with its own production. Also, Nordic countries have shown interest in the tomatoes, especially because of their price. The Turkish market is less attractive. Prices have risen, so stimulating domestic consumption will be difficult.
Russia: Turkish tomatoes replaced by Moroccan produce
Turkish tomatoes were popular amongst Russian consumers, but since the government closed the border in January to Turkish imports, including tomatoes, Russian importers have replaced them with Moroccan produce. The disadvantage of this is the longer shipping time. Also, the colour of Moroccan tomatoes is not as attractive, according to a trader. Therefore, imports have been reduced. Prices in Russia have increased sharply, mainly due to the erratic exchange rate. "The conclusion is that the boycott on Turkish tomatoes is a great loss for the Russian market," states an importer.
Another importer says that the recent price drops in St. Petersburg have been a result of the impact of both the rain and cold in Morocco and the Russian crisis. Just two weeks ago, tomatoes cost 2 dollars per kilo. Now that price has dropped to $ 1.15 per kilo. Because of quality problems with the Turkish tomatoes, the importer explains that they had already switched before the boycott to Egyptian and Moroccan tomatoes. "In our opinion, Moroccan tomatoes have always been of better quality," says the importer.
Israel: 65% drop in exports
Tomatoes are a very important product for Israeli horticulture. In terms of volume, only grain and potatoes are more relevant. In recent years, the number of growers has decreased due to the low prices recorded on the domestic market, as well as other external factors. The market is quite vulnerable to price changes caused by the impact of the weather or sudden increases in demand. A similar situation occurred in September and October last year.
In 1999, when the country reached its peak, Israel tomato production stood at around 600,000 tonnes. Since then, that volume has declined steadily down to 450,000 tonnes. The impact of this decline, however, has been mainly observed in exports, as domestic demand has increased. Exports have dropped by 65 percent in five years, down to the 15,000 tonnes recorded last year.
The price for the top quality stands at around 1 euro per kilo. In recent months, prices have actually tripled. Because of these high prices, and despite opposition from Israeli growers, the borders were opened for imports, especially from Turkey. The government announced that it would allow more imports to keep prices at an acceptable level.
Conflicts Iraq and Syria hit Jordan
Jordanian tomato growers are feeling the impact of the loss of its two largest export markets, Syria and Iraq. Greenhouse growers have been the most affected by the low prices, which are the result of oversupply. The main export markets were Syria and Iraq, but the conflicts in those countries have resulted in their loss. Greenhouse tomatoes, which had reached prices of about 2 euro, currently cost 0.35 euros per box. The sector is trying to shift the trade to the Gulf region. Europe is not an option, given the abundance of tomatoes from countries such as Morocco and Spain. The country, therefore, needs to find gaps in the supply in Europe. Also in the Gulf region there is a lot of competition from other supplier, such as Morocco, Tunisia and Egypt.
Pakistan: higher prices around Ramadan
Tomato cultivation in Pakistan is particularly strong in the Punjab region, but tomatoes are also grown in other provinces. During the hot wet season, production shifts to the cooler regions of the highlands. At other times of the year, production also takes place in the lowlands. Because of the heat and the rain in June and August last year, there has been a smaller production.
The highest quality produce is intended for export, mainly to neighbouring markets, such as Russia, China, Afghanistan, India, Sri Lanka, Saudi Arabia and the United Arab Emirates. A widely grown variety is the Roma; other popular varieties are the Moneymaker and Rio Grande. Most traders prefer exports over the local market, since exports are lucrative. The export is difficult due to high transportation costs and a shortage of reefer containers, which are needed to cover the 400 kilometres of land travel for the product. "The quality of our tomatoes is similar to that of the Indian produce, but India naturally has much easier access to the Russian market," explains a trader.
Prices currently range between 350 and $ 550 per tonne, which is an average price. In the run-up to Ramadan, they are expected to increase. A trader talks about a possible doubling of the price.
Australia: smaller volume, higher prices
Between 2000-2001 and 2013-2014, production has decreased on average by 1.8 percent per year. In the 2013-2014 campaign, the harvest reached 326,000 tonnes; in the same period, the price of tomatoes increased by 2.2 percent per annum, reaching a total value of 481 million dollars in the 2014-2015 campaign. This shift is mainly a result of a drop in supply to the processing sector. The main export markets are New Zealand, Japan, Thailand and Singapore. New Zealand and Singapore together account for half of the tomato exports. There is a growing market for specialties.
Growth market Japan
Tomato consumption in Japan is on the rise. There is also increasing diversification in the market, and opportunities are great in the archipelago for large beefsteak tomatoes. There has also been a development of the market for specialties. Tomatoes are an integral part of the shopping list of Japanese consumers, who frequently use the tomatoes for salads.
US: high prices because of winter weather
Storms, heavy rain and even tornadoes have crossed Florida, leaving a trail of destruction behind. As a result, the production of all products has been delayed and the supply of tomatoes is also lower. This results in high prices. A new harvest is expected this month. Growers hope that this new batch will not lead to sharp price drops. Besides the impact of the weather, production has also slowed down due to the decision from many growers to abandon the crop due to the poor results achieved in recent years. About 80 percent of the tomatoes in the US are currently being imported from Mexico.
Dominican Republic Mexico more competitive
The market for greenhouse tomatoes has been growing in recent years in the Caribbean island. A grower says that between 30 and 32 hectares were harvested. Besides the domestic market, which is primarily interested in specialties, there is a lot of exports. These exports go mainly to the US and other countries in the Caribbean. In any case, there is also a lot of competition from Mexico, which has put the prices of certain tomatoes under pressure. Roma tomato prices are low and this is the case also for other varieties.
Mexican production expanding
The tomato production in Mexico has grown considerably in recent years. The product is available all year round and, according to official figures, a total of 2.8 million tonnes were harvested in 2014. Exports generated 20 billion pesos (1 billion euros). The bulk of the exports go to the United States, Canada and Europe. Greenhouses play a major part in horticulture, partly due to their success in the international markets.
China: cherry tomatoes as a delicacy
In December, tomatoes recorded record prices of 4.40 yuan (0.60 euros) per kilo; the highest since 1996. A year earlier, prices were still below cost, causing many farmers to throw in the towel and reduce their acreage. As a result, the market has recovered. Rain in December and frosts in January have taken a toll on the production, causing prices to remain at good levels at the time when greenhouse tomatoes hit the market earlier this year.
Cherry tomatoes are growing in popularity. They are sold as delicacies by fruit and vegetable traders, together with blueberries and cherries. The harvest of cherry tomatoes is currently underway in the southern provinces of Guangdong and Guangxi. Moreover, great investments are being made to expand their cultivation on Hainan Island, in South China.
Every week, FreshPlaza and AGF.nl publish an overview of the market situation of a product in a global context. With these articles these articles we aim to provide a view of a global market shrinking due to globalisation. Next time, grapes will be in the spotlight.