Foodnews 15 02 2013

UK drinkers are changing Quote
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their behaviour. They are drinking less but spending more on better wine
Robert Beynat, chief executive of Vinexpo UK sparkling wine consumption likely to exceed previous figures, p4
VOL. 41 00 No. 00 FEBRUARY 2013 VOL. No. 7 15 00 MONTH 2011
Brazil likely to major on NFC juice in forthcoming marketing season

BY NEIL MURRAY
BRAZILIAN FcoJ EXpoRTS 2012 (ToNNES)

120000 100000 80000 60000 40000 20000 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: SECEX Foreign Trade Secretariat
THE official price of FCOJ from Brazil seems to have slipped slightly. Reliable FOODNEWS sources say that the product can now be sourced for around USD2 300 per tonne cfr duty unpaid Rotterdam, but FCOJ from independent suppliers can still be had for at least USD200/tonne less.
113057 106371
TA D DA OA WNL DO K TO CLIC
72281 76167 78878 84361 70948 75335 57659 29770
92232
62103
We witnessed an enormous manipulation of information, starting with the non-publication of a joint Conab/IEA harvest estimate and the publication of data that obliged the USDA to revise its numbers.
have a repetition of the [same] facts in the next harvest, despite the indications that there will be a
coNTINUEd oN pAgE 3
We are very firm at USD1 950/2 000 per tonne FOB Santos, said one independent, adding that the tonnage being shipped was lower than expected. At the same time, there seems to be a question mark over the exact size of Brazils inventory. Last autumn, this was put official at 660 000 tonnes (FOODNEWS 19 October 2012), of which 311 000 tonnes represented stock held under the governments support scheme, and which could not be released until later in 2013. Last summer, it was estimated that the countrys main orange juice producers were indebted to the tune of around USD490 million
(FOODNEWS 29 July 2012). Now, however, FOODNEWS has heard from more than one source that the inventory may be only half the previously-mentioned total: the figure being bandied about is anything between 200 000 and 400 000 tonnes. This begs the question of where the remaining inventory has gone. One suggestion is that the size of the inventory was over-stated from the beginning (which seems unlikely). Another is that creative accounting has reduced it, by diverting stocks into other hands, such as corporate subsidiaries.
ANALYSIS
NO, the Brazilian FCOJ producers have no real reason to cut their prices. The government is guaranteeing the farmers a certain revenue for their fruit and is under-writing the storage of the countrys FCOJ inventory. However, the countrys juice processors are now utterly reliant upon (principally) European demand for their premium NFC juice. Should demand for this slacken, for whatever reason, the consequences would be severe. While buyers see no need to place large orders and can effectively buy FCOJ precisely when they want to, the independents will continue to do good business (within their production constraints) as they can comfortably undercut the majors. What they cannot do, of course, is supply very large quantities.
Flavio Viegas, president of Associtrus (the growers organisation) has said in a statement published in the latest February/ March edition of the Associtrus newsletter: We witnessed an enormous manipulation of information, starting with the non-publication of a joint Conab/ IEA harvest estimate and the publication of data that obliged the USDA to revise its numbers for the Brazilian orange harvest three times.. Viegas explained that the initial stocks for 2012 calculated by the USDA were based on information from the industry and vary between 205 000-440 000 tonnes equivalent (66 brix) or around one-fifth lower than the comparative CitrusBR figure. Viegas also claims that exports in the past half-year were also 17% higher than the juice industrys own expectations and totalled 586 000 tonnes equivalent. These errors in estimates are much higher than what is acceptable and they tend to confirm our belief that the crisis was fabricated, he said. If determined government action does not ensue, we will
IN THIS ISSUE
UK sparkling wine consumption to exceed previous figures 4 California grape crush hits record high 5 Southern hemispheres apple harvests predicted to rise 1% 7 Chinese and Polish AJC price dips worry Chilean sellers 9 Buoyant raw cashew nut market following trade of African crops 15 Norways largest supermarket announces move to PNA tuna 24
Find more key data in our on-line library at www.agra-net.com
Key Indicator Snapshot
Brazilian FCOJ -4% this year

USD2 300/tn cfr Rott
Brazilian FCOJ stock -20% claimed

Disparity in figures
S hemisphere apple crops +1% in 2013

5.468m tonnes
Editorial comment
Hidden dragon, crouching tiger no longer

VOL. 41 No. 7 15 February 2013
coNTENTS
INDUSTRY NEWS World Juice Conference will be held in Kln just before ANUGA 3 FRUIT JUICE Cause for celebration as NFC orange juice sales rise steeply 8 SOFT DRINKS Cocofina makes bigger splash worldwide with coconut water 10 WINES China ramps up its wine output, as sparkling wine sales rocket 11 TOMATO PRODUCTS Tomato crop forecasts cautious as end of market inertia still far-off 13 DRIED FRUIT & NUTS Stable sultana and raisin prices for Turkey, but 2013 crop shorter 14 FROZEN FOODS Chilean harvest reaches peak but fewer blueberries for freezing 16 BUSINESS INTELLIGENCE Chinas food industry grows to cater for urban affluence 17 WEATHER WATCH Below normal rainfall for Florida; heavy snow across New Jersey 20 MARKET DATA Asian soft drinks win markets 2 21
CHINA continues to surprise us all; that is aside from the various food scares we all know about. Forgetting the melamine scandal, pine mouth syndrome and norovirus strawberries, the country is proving its might as an importer, exporter and producer.
It seems like weve heard it all before, but Chinas rise in prominence really is remarkable. Even a decade ago we knew of it as a huge country with an equally huge population, but the rest really remained a mystery. But things have changed, and the country is suddenly opening up and showing its strength. Its shocking really, when one looks at the global wine market for example, just how far up China is on the top 10 list of global producers. Currently nestled in between Chile and Germany, and above South Africa, China is expected to produce 166.6 million 9-litre cases in the 2012-2016 period, propelling it higher than Australia and Chile. This in itself
caused gasps of astonishment from wine professionals attending the Vinexpo press conference held in London last week. The funny thing is, although we think of China as having a huge potential market for wine, no one actually really considers it as a producer. Its definitely time to take note. Then of course there are the consumption figures. The Chinese enjoy wine, indeed there is evidence of consumption way back during the Shang dynasty, and there is an appetite to buy even more. A burgeoning middle class is eager to spend more on what they perceive to be luxury goods, and wine is no exception. More Vinexpo data shows China (including Hong Kong) to be in fifth spot in terms of global still and sparkling wine consumption, with a huge 247.3 million 9-litre cases forecast by 2016. That is way above UK consumption, as well as Russia, Spain and Australia. But rather than proving to be a boom and bust model, growth has been steady and industry sources are talking of a
slow increase. So, should we be scared of this growth? No, I dont think so. As FOODNEWS was told by the head of Vinexpo last week, its a good evolution. After all, this growth in wine production brings with it increased competition and a far bigger market for the product. Major wine producers, particularly old-world producers are looking to restructure their vineyards and change the way they make wine, and so new producers are desperately needed to fill the gap. Its also worth bearing in mind that some traditional big wine consuming countries are beginning to fall out of love with the product, and who better to make up the shortfall than China? We should no longer be surprised at Chinas potential power; it is clear to see and here to stay. The mystery of the Orient has begun to unravel and we must embrace the opportunities it offers. Hidden dragon, crouching tiger no longer.
MoST REAd
Do you see FOODNEWS daily email alerts? See below the most clicked-on daily news stories this week:
1. European and Chinese AJC prices dip again 2. Brazilian FCOJ output cut bolsters orange oil price 3. World Juice 2013 - in Koln, just before ANUGA 4. Sharp increase in retail NFC orange juice sales 5. Argentine peach processors predict larger crop
6. Letter to the Editor - Tomato products in Chile 7. Tomato crop forecasts cautious 8. Wisconsin lost over 20% of strawberry crop in 2012 9. Norways biggest supermarket chooses PNA tuna 10. Banana chip supply extremely difficult
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COMPANY INDEX Alicorp Ball Packaging Brsipr Bel CCH Cocofina Findus General Mills Gerald MacDonald Hartwall 18 5 7 5 10 16 18 18 18 Heineken ICA Kraft Foods Pastificio Santa Amalia PepsiCo Royal Ahold Tradeteam Unil Wow! Nutrition Yum Brands 18 19 5 18 4 19 5 24 8 7
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Informa UK Ltd 2013 FoodNEWS 15 February 2013
Industry News
World Juice Conference will be held in Kln just before ANUGA

BY FoodNEWS STAFF
THIS years FOODNEWS World Juice 2013 conference will take place in Cologne for the first time ever, on the Thursday and Friday immediately before the opening of ANUGA.
While World Juice has always taken place in the week before ANUGA, up until now it has been in a different city. We have had more and more feedback that travelling between World Juice and Cologne makes life harder than it should be. By making this move, well make life easier for our regular delegates as well as opening up World Juice to ANUGA visitors who have not previously attended, commented David Monaghan, head of conferences at FOODNEWS. World Juice 2013 takes place at the Pullman Cologne hotel, on Thursday 3 and Friday 4 October. Speakers already confirmed
coNTINUEd FRoM pAgE 1
The networking and hospitality at World Juice is legendary

include representatives of ASDA, the UKs second-largest grocery retailer and Grove2Glass, CocaColas global juice purchasing unit. ANUGAs importance as a forum for doing business in the juice industry is well known. Practically all juice packers and processors from all over the world attend, and the new slot for World Juice 2013 will be especially attractive for delegates from source. If this is correct, then we are looking at a stable price structure and the smaller boys will be able to undercut them. Meanwhile, the major FCOJ buyers in Europe obviously seem comfortable with their stocks and supply situation and are believed to be extending their contracts out until July. The cold northern European winter is also constraining juice consumption. Of the Big Three Brazilian processors, one is believed to have paid rather more for its fruit than the other two and might break ranks in the price agreement, though other sources reckon that the official price will endure. However, right now, fruit prices are around BRL6.00 per box, and the government is making this up to the agreed BRL10.50/box. Those FCOJ manufacturers that are still processing are having to battle with poor yields due to the inclement weather and outside Europe who will be able to cut a couple of days off their trip, as well as an additional flight, thereby saving time and money. Last years World Juice attracted the widest geographical audience ever in the events 17 year history, with over 50 countries represented among over 350 attendees. The global make-up of the event is one of the factors which make it unique, since it adds so heavy rain, especially in the north of the country. One contact put yields at 330 boxes per tonne of FCOJ, compared with the accepted So Paulo standard yield of around 250 boxes/tonne. One side-effect of the inventory, according to an independent, is that with less FCOJ processed, less orange oil is being made. As the approaching season will not be good, the big guys will try to make as much NFC juice as possible, he said, pointing out that NFC orange really cannot be held in store, because it requires vastly more storage space, so it is processed and shipped immediately. In the forthcoming season, however, FCOJ can be shipped from stock. When you process NFC juice, you recover much less oil, he added. The result? Oil is now already at USD3.30 per kilo against USD2.20/kg a month ago and heading to USD4.00/kg. Nice business for everybody, no? much to the networking value for delegates, said Monaghan. I am confident that the new dates and location will broaden this range even further. Neil Murray, FOODNEWS editor, added: This is brilliant news. Nobody thought that timing World Juice to run alongside ANUGA would be possible, given the constraints of cost and accommodation, but now visitors to the show will be able to take in the conference immediately before the show opens, relax after their travelling, and enjoy World Juices legendary networking and socialising. Although 3 October is Unity Day, a German public holiday to celebrate re-unification, the organisers do not consider this a significant barrier to attendance. Our German contacts tell me that they are not going to take a day off work two days before ANUGA, said Monaghan, and we are planning some fun ways to work this theme into our famous social programme! The programme for World Juice 2013 is currently being developed and will retain the events focus on raw material markets and new product developments and trends around the world. Parallel streams covering these different themes ensure that everyone attending can choose the sessions that will make the conference 100% relevant for them. More details of the speakers and the conference programme are available at www.worldjuice.com.
17% drop in production in 2013/14. Since Cristian Lohbauer left CitrusBR, the processors organisation (FOODNEWS 18 January), FOODNEWS has received no communication from the industry. What is likely is that although there has been a small reduction in the FCOJ price, the price will remain more or less unchanged for the rest of the season. Temperatures in So Paulos citrus groves have fluctuated wildly recently: as low as 5C and as high as 45C. This is signalling a smaller harvest this season. FOODNEWS contacts reckon that while the So Paulo state harvest might be down by 10% (it has also been described as normal), harvests in the west, north and east of the country are looking to be some 30% down. This suggests that [the big Brazilian processors] are not desperate sellers, said one
Key Indicator Snapshot
Iran pitted Sayer dates +2.1%

GBP970/tonne
Turkish No.9 sultanas +2.0%

GBP1193/tn ex wks UK
Indian cashew kernel +4.3%

GBP5119/tonne
Find more key data in our on-line library at www.agra-net.com
Industry News
UK sparkling wine consumption likely to exceed previous figures

BY JENNIFER WILLIS-JoNES
BRITISH wine drinkers are consuming more sparkling wine than ever, and in five years time will consume more than 126 million bottles of Champagne, Cava and Prosecco, sources from Vinexpo/IWSR have told FOODNEWS.
The increase will push Britain into the top spot for imports of sparkling wine, placing Germany, the previous leader, into third place after the US. In 2011 the UKs top five suppliers of sparkling wine were France (37 million bottles) Spain (35 million) Italy (19 million) Australia (8.5 million) and South Africa (2.5 million). Owing to the popularity of locally produced products, UK consumers will also double the amount of English sparkling wine they drink, though the total of 5.7 million bottles (480 000 cases) will be minuscule compared with production on the continent. Overall, consumption of English sparkling wine will have risen nearly 342% in the 10 years from 2007 to 2016. However, consumption of still red, white and ros wine in the UK
The data reveals how UK drinkers are changing their behaviour. They are drinking less but spending more on better wine.
The biggest increases in that period were shown by Spain and New Zealand which grew by 22% to 12 million cases, and 80% to 4.8 million cases respectively. Robert Beynat, chief executive of VINEXPO, said: The data reveals how UK drinkers are changing their behaviour. They are drinking less but spending more on better wine. The fact remains that the UK is still the worlds biggest importer of wine and therefore a major force in world wine business. It is the ambition of many world winemakers to gain a foothold in the UK. When asked whether the proposed minimum unit price on alcohol and ban on price promotions would affect UK wine sales, Beynat claimed it would undoubtedly have an impact. A contact at the IWSR added that it might have a bigger impact than expected. Never underestimate the impact of anti-alcohol lobbyists.
Beynat and Eizaguirre, chief executive and chairman of Vinexpo

is in long-term decline. By 2016, sales of still wine will fall 4.7% to 1.44 billion bottles (120 million cases) from 1.5 billion bottles (125 million cases). Over the 10 years from 2007 the decline will be more than 10%. For the first time in the UK, consumption of white wine is forecast to overtake red wine. By 2016 white wine will account for nearly 45% of all still wine sales, while red wine will fall to just over 42%. Drinking of ros wine, which saw a 6% rise in recent years, is forecast to fall 2.5% in the next five years. The UK is still the worlds biggest retail market for imported still wine by value and is likely to remain so, FOODNEWS was told. While imports will fall in value, at GBP7.9 billion (USD12.3 billion) by 2016 they will be more than half the size again of the US, the worlds second largest importer. US imports will grow 10% to reach GBP5.3 billion in five years time. While imports of Australian still and sparkling wine fell 18% between 2007-2011, Australia is still the UKs largest supplier by volume at 306 million bottles (25.5 million cases). Over the same period Italy moved into second place with 19.5 million cases a 28% increase over France which fell 13% to 19 million cases.
PepsiCo aims to kickstart fruit Latest Brazilian beverage sales consumers belonging to the sojuice breakfast drinks market BY VLAdIMIR pEKIc called B economic group
BY NEIL MURRAY
PEPSICO has taken a cue from consumers and fast food restaurants that have been mixing fruit juice with Mountain Dew, its carbonated soft drink, by producing its own ready-mixed version.
Kickstart is a blend of juice and Mountain Dew and is being launched in the US on 25 February. It will be available in Orange Citrus and Fruit Punch flavours, with a 5% fruit juice content, plus vitamins B and D, and caffeine. The 5% juice content means that, under FDA regulations, it can be sold as a juice drink. The FDA does not have definitions for sodas or carbonated soft drinks.
The launch follows the listing of a drink called Mountain Dew AM, a blend of Mountain Dew and Tropicana orange juice, by the Taco Bell chain last year (FOODNEWS 7 September 2012). Despite the caffeine content, the product is not being billed as an energy drink. Its caffeine content is lower than that of Red Bull and Monster, says PepsiCo. Our consumers told us they are looking for an alternative to traditional morning beverages one that tastes great, includes real fruit juice and has just the right amount of kick to help them start their days, said Greg Lyons, Mountain Dews vice president of marketing. The drink is backed in 16oz cans, each containing 80 calories.
BRAZILs beverages market last year recorded sales worth BRL17.7 billion (USD8.89 billion), according to an estimate released by the Brazilian confederation of Ambev beverage resellers and logistics firms (Confenar). The total includes water, carbonated soft drinks (CSDs), juice, beer, wine and distilled drinks.
Almost half (BRL8.8 billion) of last years beverages sales were concentrated in south-east Brazil, followed by BRL3.3 billion of sales in the south of the country, BRL3.0 billion in the north-east, BRL1.5 billion in central-west and BRL1.1 billion in northern Brazil. Most purchases were made by
(42.65%), followed by consumers from the C economic group (40%), according to Confenar that based its conclusions on data contained in Pyxis Consumo, a market research tool created by market research firm IBOPE Inteligncia. AmBevs investments in northeast Brazil are expected to bring even greater impetus to the beverages market in this booming part of the country, commented Confenar president Hamilton Picolotti. Namely, from its planned BRL2.5 billion of investments for Brazil in 2012, AmBev was expected to invest around BRL804 million in the north-east part alone, including BRL375 million in the production of CSDs and beer in its Aquiraz unit, in Cear state.
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Informa UK Ltd 2013 - FoodNEWS 15 February 2013
Industry News
Record Californian grape crush accompanied by strong prices

News In Brief
Drinks cans to Libya
BALL Packaging Europes (BPE) aluminium can plant in Serbia will export 300 million beverage cans in 1 400 containers for PepsiCola in Libya, according to BPE sales director Nenad Djurdjevic. Vladimir Pekic writes: the deal will boost BPEs can exports from Serbia by 30%. Djurdjevic also announced that Orangina will soon start juice production in Serbia with the aim of exporting juices to the region. BPE is also in talks with Monster Energy regarding the possible opening of an energy drink production plant in Serbia, which would serve as an export base.
CALIFORNIAs 2012 crush totalled a record high of 4.383 million (short) tons, up 13% from the 2011 crush of 3.874 million tons, and 1% larger than the previous record high 2005 crush.
According to a recent USDA/ NASS report, red wine varieties accounted for the largest share of all grapes crushed, at 2.289 million tons, up 19% from 2011. The 2012 white wine variety crush totalled 1.724 million tons, up 21% from 2011. Tons crushed of raisin type varieties totalled 270 085, down 28% from 2011, and tons crushed of table type varieties totalled 99 111 tons, down 36% from 2011. The 2012 average price of all varieties reached a record high of USD734.35, up 24% from the
Uruguay success in blueberry exports

BY dAVIdE gHILoTTI
previous year. Average prices for the 2012 crop by type were as follows: red wine grapes, USD879.04, up 24% from 2011; white wine grapes, USD623.50, up 15% from 2011; raisin grapes, USD318.62, up 20%; and table grapes, USD272.21, up 24%. In 2012, Chardonnay accounted for the largest percentage of the total crush volume with 16.8%, followed by Cabernet Sauvignon with 11.3%. The next eight highest percentages of grapes crushed included wine and raisin grape varieties. Thompson Seedless, the leading raisin grape variety crushed for 2012, held 5.3% of the total. Grapes produced in District 4 (Napa County) received the highest average price of USD3 578.79 per ton, up 5% from 2011. District 3 (Sonoma and Marin counties)
The 2012 average price of all varieties reached a record high of USD734.35, up 24% from the previous year. Thompson Seedless, the leading raisin grape variety crushed for 2012, held 5.3% of the total.
received the second highest return of USD2 181.88/ton, up 5% from 2011. The 2012 Chardonnay price of USD846.40/ton was up 12% from 2011, and the Cabernet Sauvignon price of USD1 376.14/ton was up 19% from 2011. The 2012 average price for Zinfandel was USD712.85/ton, up 27% from 2011, while the Merlot average price was up 15% from 2011 at USD800.77/ton.
Coke distribution deal

COCA-Cola Hellenic (CCH) has granted Tradeteam, the specialist alcoholic drinks delivery operation of DHL, a three-year contract to distribute soft drinks throughout Northern Ireland. This is Tradeteams first direct relationship with a soft drinks supplier. It involves 1 600 deliveries per week to bulk and direct store customers across Northern Ireland and a number of CCH drivers have transferred to DHL. Deliveries are made on vehicles based at both CCHs bottling plant in Knockmore Hill, Lisburn as well as Tradeteams shared user site in Culcavey.
URUGUAY has entered the top 10 of global blueberry exporters, and has become the second biggest citrus exporter in Latin America, according to a recent study conducted by the nations Instituto Uruguay XXI.
The strong development of the blueberry industry in the country is due to weather conditions that favour blueberry cultivation, together with high availability of fertile land. These characteristics, according to the report, place Uruguay ahead of other global blueberry producers. Figures confirm the rapid growth of an industry that is still in its infancy. The first commercial plantation of blueberries in Uruguay was opened in 2001. Two years later, the first blueberries were exported, and the state realised the potential this product could have on the international markets where demand for this and other berries has been growing notably, thanks also to their healthy properties. Blueberry growers in Uruguay can also rely on having opposite growing
seasons to those in Europe and the US this same characteristic has helped Chile achieve one of the top spots in the trade. Blueberry acreage increased steadily in the last ten years, as were exports, which reached a record of 2 713 tonnes two years ago. Last year, exports totalled 2 146 tonnes, worth USD15.6 million.
As regards citrus, Brazil has increased its demand of Uruguayan product as of lately, accounting for 9% of market share in 2012, Instituto Uruguay noted. The European market, though, remains the main export destination; demand from Europe has been the main force that has driven citrus (mainly oranges and mandarins) to its position as Uruguays second fruit export.
Stable Florida blueberry crop

BY dAVIdE gHILoTTI
HARVEST time for Floridas blueberry crop is just over a month away, as weather conditions are reported to have stayed stable and mild until now.
We have had a few cool nights but nothing that will slow the crop down, wrote the Florida Blueberry Growers Association (FBGA) in a recent update. The crop appears early to me at this point but we have a few more weeks of cool weather, said FBGAs president, Bill Braswell. The crop has peaked all over the map for the last three years: 12 May [in] 2010, 28 April [in] 2011,
17 April [in] 2012. My guess is we will peak before 17 April this year. Florida is one of the only growing districts in the US that is able to cultivate blueberries in this period of the year, harvesting from late March to April. Because fruit blossoming takes place in February, the main threat to fruit development is frosts. Cold temperatures can wipe out entire blueberry crops, and this has been the case in a number of occasions in the past years. For this reason, Florida is not a competitive player in the processed fruit sector, while virtually all produce goes for the fresh market.
New drink from Kraft

KRAFT Foods has released a new range of drinks in the US, targeted at women. Crystal Light Liquid drinks are a blend of non-nutritive sweeteners and are caffeine free, gluten free and sugar free. They come in a resealable 24-serving bottles and in six different flavours including Strawberry Lemonade, Blueberry Raspberry, Iced Tea, Mango Passionfruit, Peach Bellini and Pomtini. They are available in mass market and grocery stores nationwide.
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Examine the latest consumption trends in Eastern, Southern AND Western Africa for juice Hear insights into key raw material production in the region for: orange, pineapple, mango, peach and pear Analyse the development and growth of juice retailing in Sub-Saharan Africa Safely navigate the potential distribution and investment pitfalls juice businesses face in this region Network with key players and decision makers from across the juice supply chain
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Industry News
Southern hemispheres apple harvests predicted to rise 1%

BY NEIL MURRAY
New Brazilian potato variety

BY VLAdIMIR pEKIc
2013F 1627 1270 937 826 519 289 5468
SoUTHERN HEMISpHERE AppLE pRodUcTIoN (000 ToNNES)

chile Brazil Arg S Africa NZ Australia Total SoURCE: WAPA
REPRESENTATIVES of key apple and pear producing and exporting countries from around the world met on 8 February 2013 at the recent FruitLogistica fair in Berlin for the annual general meeting of the World Apple and Pear Association (WAPA).
ATA AD D LO OWN OD CK T CLI

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2011
2012
BRSIPR Bel, a new potato variety for industrial processing, was officially presented by Brazils agronomic institute of Paran (Iapar) and the federal agricultural research agency Embrapa in Cascavel on 6 February.
WAPA has released its annual consolidated crop forecasts for the forthcoming southern hemisphere apple and pear seasons. Collected from industry groups in Argentina, Australia, Brazil, Chile, New Zealand and South Africa, the forecast shows that the 2013 southern hemisphere apple and pear crops are expected to reach 5.468 million tonnes and 1.520 million tonnes, respectively. For apples, this
China eats into Yum Brands
FEAR over the safety of chicken in China is having a bigger impact on Yum Brands than previously thought, writes Louis Harkell.
Yum, whose KFC unit was the target of a Chinese government investigation into antibiotics use in poultry, said that it expects earnings per share to decline in 2013, after predicting 10% pershare earnings growth in November. Yums fourth-quarter earnings fell 5.3% to USD337 million, down from USD356 million a year earlier. Revenue rose 1% to USD4.15 billion. The US-based company said in January that it expected samestore sales sales at stores open at least a year in China to decline 6% in the fourth quarter of 2012 following media reports of improper antibiotics use on the part of some producers that supplied chicken to KFC. Now, it appears the issue is going to affect Yum into the first quarter of 2013, with a same-store sales decline of 25% in China in January and February combined.
represents a small increase of 1% on the 2012 crop; while forecasted export figures also increase by 4% to 1.667 million tonnes. For pears, a small increase of 2% on the 2012 crop is recorded while forecasted export figures are expected to be 5% higher at 749 821 tonnes. The biggest harvest decline is forecast to be in Chile, with an 8% drop from 2012 to 1.627 million tonnes. This is also 8% below the average for the last three years, and may impact on the quantity of fruit available for processing. There has been a noticeable decline in Granny Smith apple production, and a rise in Cripps Pink output. During its annual meeting WAPA elected Peter Beaven of
The biggest harvest decline is forecast to be in Chile, and may impact on the quantity of fruit available for processing. There has been a decline in Granny Smith apple production, and a rise in Cripps Pink output.
Pipfruit New Zealand as its new president replacing Kevin Moffitt (USA Pears USA) who chaired the association for the last two years. At the same occasion, Daniel Sauvaitre (ANPP France) was elected as the new vice-president of WAPA.
Cuban tomato crop doing well

BY dAVIdE gHILoTTI
THE Cuban tomato industry is well on its way in both the raw material production and the processing segments, as investments made into all stages of the supply chain are proving valuable to boost the sectors overall capability.
forecast of 825 tonnes. Fruit quality is reportedly good and, as for February, it is expected that 1 023 tonnes will be harvested.
Hurricane damage
A modern tomato processing facility, located in the Cuban province of Guantnamo, will soon start receiving consignments from local growers, the countrys media reported. The plant, which was visited by vicepresident of the council of state and ministries, Jos Ramn Machado Ventura, has installed processing machinery bought in Italy, and will produce tomato pures and fruit pulps. The tomato crop in Cuba is said to be proceeding well. Some 1 311 tonnes have been harvested in January, against an initial
Tomato crops in parts of the country have been affected by hurricane Sandy in late October; this forced producers to delay and extend plantings, in some cases until the end of December. According to local media, 460 hectares have been planted, and contracted volumes have reached 5 701 tonnes it is forecast this should be reached by April. An important phase in the process of modernisation of the Cuban tomato sector is renovation works currently being carried out on an 85-km long irrigation system. Almost two thirds of the works have been done, and the rest is scheduled for completion in the course of this year.
The new cultivar is characterised by greater productivity and it also produces high quality tubers that are excellently suited for frying, which makes it ideal for industrial processing into crisps and French fries. The variety, which was developed from a cross between the Rioja and C-1740-11-95 varieties in 2001, has a maturity of around 110 days. BRSIPR Bel is moderately susceptible to potato blight (Phytophthora infestans) and moderately resistant to early blight (Alternaria solani), potato virus Y (PVY) and potato leaf roll virus (PLRV). In a separate development, Serbias potato crisp factory Slap Group, which was recently privatised for the second time, announced it plans to resume production on 18 February. Once a leading producer of industrialised potato products in the former Yugoslavia, the bankrupt company in the central Serbian town of Cacak was sold for EUR1.0 million (USD1.3 million), after its assets were originally valued at around EUR3.61 million. The new owner is a consortium of three individual investors who purchased the companys 4.3 hectares of land, 12 000 square meters of factory and office space and three lines for production of industrial mashed potatoes, crisps and potato snacks. Serbias potato harvest amounted to 577 966 tonnes in 2012, down around 40% from the previous year. Potato production was organised on 75 449 hectares, according to Vojislav Stankovic, an analyst at Serbias Chamber of Commerce (PKS).
The new cultivar is characterised by greater productivity and is excellently suited for frying.
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Fruit Juice
Cause for celebration as NFC orange juice sales rise steeply

BY NEIL MURRAY
AFTER a dip in US retail sales of NFC orange juice last month, the latest fourweek report from the Florida Department of Citrus (FDOC) shows a very strong rally for NFC juice.
So Paulo to have smaller orange crop

BY VLAdIMIR pEKIc
Volume sales for the four weeks to 19 January were up by a surprising 12.5% to 29.64 million gallons (26.35 million gallons for the same period last year). With a 2.3% rise in the average price of NFC orange juice to USD7.25 per gallon (USD7.09/gallon), this helped fuel a 15.1% increase in NFC juice value sales to USD214.97 million (USD186.82 million). This was enough to lift the whole US retail orange juice sectors figures by 5.5% by volume to
51.19 million gallons (48.55 million gallons) and by 7.4% by value to USD320.10 million (USD298.14 million). However, the reconstituted juice sector, which means juice derived from FCOJ, was still down. The increase predicted by the USDA in FCOJ consumption (FOODNEWS 8 February) still has not materialised, although the rate of decline is certainly slowing down. Reconstituted juice sales were 18.87 million gallons (19.26 million gallons), and with a 3.0% decline in the average retail price to USD4.87/ gallon (USD5.02/gallon), that meant a value fall of 4.9% to USD91.90 million (USD96.67 million). For the season to date, volumes are down by 1.2% to 186.58
US RETAIL oRANgE JUIcE SALES (MILLIoN gALLoNS)

56.00 54.00 52.00 50.00 48.00 46.00 44.00 42.00 40.00 38.00 36.00
46.69 44.73 45.19 48.82 46.69 45.06 51.19 48.54 45.92
OW TO D K CLIC
43.36
NL
43.60
TA D DA OA
42.30 41.96 40.38 40.05 39.95
2011/12
2012/13
SoURCE: USDA
million gallons (188.80 million gallons). Values, however, are up by 0.2% (almost entirely due to this unexpected surge in NFC juice consumption) to USD1.16 billion (USD1.15 billion). The
average price of a gallon of orange juice has risen by 1.4% to USD6.22 (USD6.13).
Grapefruit juice
PRODUCERS in Brazils So Paulo state will harvest 355.29 million boxes (40.8kg) of oranges in the current 2012/13 season, or 7.7% down from the 384.87 million boxes harvested in 2011/12, according to So Paulo authorities in a new harvest forecast published on 8 February.
The survey also revealed that lemon producers in the state are expected to harvest 22.43 million boxes (40.8kg) of lemons in 2012/13 from 7.87 million trees in production. This latest 2012/13 harvest forecast by the IEA is lower than an earlier 363.15 million boxes forecast announced by the same organisation in September 2012. So Paulos Institute of Agricultural Economics (IEA) explained that this years is primarily because of climatic factors, including lower precipitation during the fruit setting stage, and because of a greater incidence of diseases, including citrus canker and HLB (greening). The Brazilian Association of Citrus Exporters (CitrusBR) estimated in May 2012 that producers would harvest 364 million boxes
in 2012/13, down 15% from 428 million boxes in 2011/12. CitrusBRs forecast referred to So Paulo state and the Tringulo Mineiro region. The total area planted with orange trees in 2012/13 is 541 360 hectares, or 5.5% less than the 569 640 ha devoted to the crop in the previous season. The total area under productive orange trees in the current season amounts to 481 900 hectares. The survey also revealed that around 2% of So Paulos existent orange trees were replanted, while 6% were uprooted.
Higher yields
Interestingly, orange yields in 2012/13 reached a surprisingly high 30 079 kg per hectare, 0.7% more than the 29 881 kg/hectare in the bumper 2011/12 season. Producers are expected to harvest oranges from 185.54 million fruit-yielding trees, while the number of new orange trees in the state amounts to 30.07 million. IEA estimates that 67% of the newly harvested crop was destined for industrial processing, while 33% ended up in the fresh fruit market. These new estimates are based on the results of a field survey conducted by the IEA and
the Integral Technical Assistance Coordination office (CATI) of So Paulos state agriculture secretariat between 1-23 November. The top five regions of So Paulo in terms of orange production, according to the latest harvest forecast, are: Barretos with 37.75 million boxes, So Joo da Boa Vista with 30.55 million boxes, Araraquara with 27.79 million boxes, Mogi-Mirim with 26.81 million boxes and Avar with 24.24 million boxes. Orange prices for industrial processing, meanwhile, continued to inch up in the second week of February, according to Brazils Centre for Advanced Studies in Applied Economics (CEPEA). The price increased marginally to BRL6.00 (USD3.04) per box, up by 1.18% from a month ago.
The fall in retail grapefruit juice volumes, however, continues, prompted by concerns over the effects that grapefruit juice has on certain medications (FOODNEWS 30 November 2012). The key NFC sector has shown a 10.0% decline from the same period last year, to 0.86 million gallons (0.95 million gallons). Yet again, grapefruit juice reconstituted from concentrate has shown a massive rise in consumption (70% this period), but at a mere 70 000 gallons, this is still a niche category. Overall, grapefruit juice sales are down 6.6% by volume at 1.41 million gallons (1.51 million gallons). By value, the fall is 2.5% at USD9.55 million (USD9.80 million). For the year to date, grapefruit juice volumes are down 5.9% at 5.42 million gallons (5.76 million gallons) and revenues are down 2.1% to USD37.01 million (USD37.79 million).
Iced tea with cranberry beverage

WOW! Nutrition, a leading player in the healthy food and beverage segments in Brazil, has launched a new ready-to-drink green tea with cranberry under its Feel Good tea brand. Vladimir Pekic writes: the new zero-calorie drink is available in 1-litre aseptic Tetra Pak cartons with removable plastic caps. The Feel Good line has four more tea products, including white tea, green tea with lemon, red tea with mulberry and winter tea with currants and apple juice. WOW! Nutrition emerged from the merger of Wow and Gold Nutrition in 2009.
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Fruit Juice
Chinese and Polish AJC price dips, to worry Chilean sellers

BY NEIL MURRAY
News In Brief
Soft drink output
CHINESE production volumes of soft drinks were 130.2 million tonnes in 2012, according to Chinas National Bureau of Statistics, up 10.7% yearon-year. Production of carbonated soft drinks (CSDs) totalled 13.1 million tonnes, an increase of 18.4%; volumes of vegetable and juice drinks were 22.3 million tonnes, an increase of 16.1%; while production of bottled water increased by 55.6 million tonnes, or 16.2%. Production volumes of soft drinks excluding the big three were 39.2 million tonnes, an increase of 13.8%.
AJc WEEKLY cASH MARKET pRIcES pER USdA (USd/gALLoN)
AJC PRICES are continuing to fall, both from manufacturers in China and Poland.
Chinese product is now put at around USD1 350 per tonne fob and are now at their lowest levels since September 2010. In the US, prices ex-dock Newark are put at USD7.00 per gallon or slightly less, equivalent to USD1 380/ tonne. The futures price, on the Minneapolis Grain Exchanges (MGEX), is now USD7.45/gallon for May delivery, with Bids of USD7.20/gallon and Asks of USD7.75/gallon. Polish AJC is somewhere between EUR1.15-1.20 per kilo, ex-works, for 2.5% acid product, equivalent to USD1 550-1 620/ tonne. It is probably still going down, commented one wellplaced source. Polish AJC could go down to EUR1.10/kg, and Chinese may go down to USD1 300/tonne. Other sources reckon that this present low price is due to smaller processors trying to generate cashflow, but the fact remains that Polish AJC prices are the lowest they have been since 2010. FOODNEWS has been told that China is holding stocks of some 400 000 tonnes of AJC. This has been impossible to confirm, and does seem a high figure. It is probable that this includes supplies that have been contracted but not yet shipped. Despite the large Chinese
SoURCE: MGEX
poLISH AppLE JUIcE BRIX 70, EXW RoTTERdAM (EUR/kg)
ATA AD D LO OWN D K TO CLIC

SoURCE: FooDNEWS
Beverage sales fall

HUNGARIAN consumption of fruit juice and soft drinks declined by 10% in 2012, according to the Hungarian Association of Soft Drink, Fruit Juice and Mineral Water Manufacturers. Annual per capita consumption of carbonated soft drinks fell to 54.6 litres in 2012 from around 57 litres in 2011. Consumption of fruit juice fell to 20.4 litres from 23.7 litres during the same period. Hungarys annual soft drinks, fruit juice and mineral water market is worth HUF170 billion (USD780 million).
inventory, it seems certain that global demand for AJC will increase, partly due to the reduced price making it more attractive to juice drinks bottlers and blenders (FOODNEWS 8 February). The large European cider producers are taking advantage of the easy supply situation and are reported to have been covering a
Fruit drinks taxes investigation

BY NEIL MURRAY
THAILANDs government wants to overhaul the tax structure applied to fruit drinks.
These are currently taxed at 20% of the ex-factory price, or THB0.37 (about 12 US cents) per 440cc, whichever method is higher. The countrys Excise Department waives taxes on fruit drinks with at least 10% fruit juice or concentrated fruit juice, under a policy aimed at encouraging consumer consumption and increasing
benefits for domestic fruit growers. Policymakers question whether the 10% minimum is too low to justify a tax exemption, when considering international practices and whether consumers buying fruit drinks actually derive a health benefit from the beverages. The Excise Department is to hold talks with the Thai Food and Drug Administration to discuss the health benefits of different fruit juices as part of its tax policy review. In 2012, taxes on non-alcoholic drinks were worth THB16 billion (USD537.5 million).
year in advance: most are believed to be covered until the end of 2013. They have the benefit of being able to use almost any acidity of AJC, since their principal concern is turning the juice into alcohol. Cider is also enjoying a resurgence in the US. At present, it is estimated that it accounts for just 1-2% of AJC sales. Artisanal ciders in the US (and Europe) are using bittersweet apples for their raw material rather than supersweet fruit, which would explain why the cider makers are wellplaced: they are not forced to buy the (still slightly scarce) low-acid juice. Latin American (principally Chilean) suppliers are now facing tough competition from China on the US market. In Europe, they can still comfortably under-price Chinese product due to their duty-free status. However, their problem in Europe is that (for the moment at least) everyone in Europe seems happily covered.
Latest Florida estimate

THE USDA has reduced its estimate for the 2012-13 Florida orange crop by less than 1% to 141 million boxes. The shortfall will all be in the Valencia fruit, which is now forecast at 75 million boxes. Early/midseason varieties are steady at 66 million boxes. The FCOJ yield estimate has increased to 1.62 gallons per box. The Florida grapefruit estimate remains unchanged at 18 million boxes.
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Soft drinks
Cocofina makes bigger splash worldwide with coconut water

BY LoUIS HARKELL
WITH expansion plans in the making, Jacob Thundil, director of UK-based Fina Brands, spoke with FOODNEWS about running a juice business using the worlds favourite desert island nut.
What is the background of the company? Im from Kerala in India. Kerala means land of coconuts. Ive had coconut water before, but I was in Brazil and sitting on a beach drinking coconut water and thought it would be great to take back to the UK. Perhaps it was destined to happen. In 2005 you couldnt really find anything healthy to drink: it was just high calorie drinks that were very sweet, or water. So we started in 2005. At that time there were no big brands around coconuts. When we were trying to sell it, people were asking What is coconut water is it milk? Why do you drink it? It was quite a challenge to educate the customer. There have been moments when we doubted wed become successful. How has the business developed? In 2005, we sold a container for the whole year. Thats mediocre. Now were sold in 2 500 outlets in the UK. Mainly Holland and Barrett, Wholefoods, Waitrose, As Nature Intended and Planet Organic. So were doing quite well in the UK. Were now exporting to 11 countries; Denmark, Sweden, Norway, Iceland, Estonia, Finland, Holland, France, Netherlands, and this month Hungary. Were also talking to South Africa. Another deal is coming through to cover the whole of the Middle East. Were making huge inroads now. We need to keep up the rates of growth without having the problems associated with high growth. Weve doubled every year for the last three years. We started as a health food product. Now were selling a lot of the litre products. It shows the market is becoming more
get five million litres from one place you have to move because you dont get the same amount again. We use a special species of south-east Asian product. It has a clean palate and is sweeter. Who are your competitors? VitaCoco is the only serious competitor there are some other smaller new entrant brands who are trying to emulate VitaCoco. Will coconut juice be used as a base for fruit juice mixes? I dont think so. I dont see where the USP is for that. People who like coconut water want to taste the coconut water. Apple juice with coconut water just tastes watered down. A product may contain coconut water and in order to promote the natural properties of the product. How do you combat rising commodities costs? The only thing you can do is to protect yourself by committing in advance to the farm to buy the raw material. If commodity prices increase when you do promotions, you do less because you cant increase the retail price every time commodity prices increase. How is 2013 looking for you? 2013 is looking very good. Were working on new products that are proprietary to us. Working to make our own proprietary formulas and were working with food development companies to do this. We hope to have some products by March. We have huge expectations for those products. Most of the products developed from now are going to be proprietary, not just from coconut water. Where do you see improvement in the industry from now? I think the mainstream has to improve. Thats where there are a lot of opportunities for growth. Places like gyms, premium places where we can promote it as a postand pre-work out drink. Protein shakes are coming mainstream. We are hoping for the same for coconut juice, but youve got to give these things time.
educated. They are buying litre products and putting it in the fridge. It is expanding from the health food segment, to delis, now to mainstream, eg. Waitrose. Is it right youve turned down some contracts with big retailers? We turned down a couple of major retailers. We need to be able to sustain our growth in the right way. There is a price for everything and Im not going to be able to sustain what they want and run a business. I said it doesnt suit my ethics. Otherwise Id be producing Cola from day one, that is, water mixed with flavour. I cant really go mass market. I think coconut water should not be degraded to the level of cola and reformulated drinks. Im quite happy with the growth that were having now. What is the product range? We have seven SKUs. We have different packaging formats: 200ml TetraPak which is pure, a 300ml can which is pure, a 500ml bottle in PET, one pure and three flavoured. Weve taken coconut water and made it like a vitamin water concept. We have flavoured coconut water which has large amounts of juice, which masks the taste of coconut water. We have mango and guava, apple and blueberry and tea and passion fruit. The latter won an award at World Juice in Spain. Tea and passion fruit is a wild card because tea is something that has never been used before with coconut juice. There is a carbohydrate content because of the natural sugars. But its low: around 21 calories per
100ml. For flavoured product it is 15 calories. As for price, our 770ml pack costs GBP3.79 (USD5.93), one litre costs GBP3.99, half a litre is GBP2.59, 200ml is GBP1.19 and the 500ml flavoured range, which is meant for the mainstream consumer, GBP1.99. Are there raw material supply constraints? Definitely. Because if you taste our drink you can feel the quality difference. When youre harvesting orange juice or apple juice or coconut juice there is a range of accepting or rejecting products. Our range is very narrow. When we have a high quality product we dont have volume. The exposure to air should be minimised or even nil. The maximum time from the nut to the bottle for Cocofina is less than 45 minutes. One thing we have to do for the fresh taste is bottling it very quickly. Some 30 000-40 000 litres comes from approximately 100 000 coconuts. The water inside the nut is sterile. If were taking water out then adding it here, it doesnt make sense. There is the environmental aspect to it [transport]. I would say it [coconut water] is more expensive than other juices. Where do you source your product? We source the coconuts from south-east Asia. They do not come from one country, but from many countries. It is not a seasonal product. But during the summer youll find less water because there is less ground water. If you
10
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Wines
China ramps up its wine output, as sparkling wine sales rocket

Top 10 WINE coNSUMINg coUNTRIES (VoLUME, MILLIoN 9-LITRE cASES)
GLOBAL wine production will fall slightly in 2012-2016, due to weather issues in various producing countries, while other nations are increasing output. Worldwide consumption, however, is expected to increase, reaching 2.873 billion 9-litre cases by 2016.
The top producers of both still and sparkling wine in volume continue to be France, Italy, Spain and the US, although China is increasing rapidly (see editorial, page 2). This was the biggest surprise for us; it is rising fast, Robert Beynat, chief executive of Vinexpo told delegates at a press conference in London. By 2016, it will be ranked the sixth biggest producer of wine in the world; that is above Australia and Chile. We consider this a good evolution for the market. Sparkling wines continue to be the standout performer in the category, and in 2011 accounted for 7.7% of all wines drunk around the world. Between 2007-2011, consumption of the drink grew by 4.17%, compared with growth of 2.72% in still wines, and is expected to grow a further 8.52% between 2012-2016. According to Vinexpo/IWSR data, this increase is primarily due to expected rises in consumption in the top four sparkling wine markets: Germany, France, Russia and the US. Indeed this shows that despite the financial crisis, the wine market is faring better than most. However, it is forecast that China, Russia Australia and the US will really propel growth in the sector. Interestingly, Europeans are drinking less and changing the way they consume wine. For the first time in 15 years, German and British wine consumption decreased in 2007-2011 by 2.73% and 4.07% respectively. The French and the Italians also reduced consumption, down 7.13% and 2.51%. Spanish consumption, meanwhile, has totally collapsed, down 19.6% in 2007-2011. The industry is now looking at ways to turn the
SoURCE: Vinexpo
situation around (FOODNEWS 6 April 2012). Either way, in the short term the country must increase its exports if it is to sell its entire production. Worth adding is that per capita consumption of still and sparkling wine in Japan grew to 2.6 litres in 2011, up 18.18% from 2007. This market is said to be exploding because of on-trade business. It is the way they sell wine in bars and restaurants, FOODNEWS was told. Additionally, it is clear from the figures that the world still prefers red wine as it accounted for 54.7% of all still wines drunk in 2011. In 2012-2016, global red wine consumption is forecast to grow by
Wine inventories tight on short harvest

BY LoUIS HARKELL
9.1%, driven especially by the Chinese, while white wine consumption should only increase by 2.75% over the same period. Ros wine consumption is expected to rise by 7.58% in 20112016, reaching a total share of 9.2% of all wines drunk. Most buyers spend less than USD5.0 per bottle, representing 69.92% of wines drunk in 2011, with this expected to increase by 2.77% in 2012-2016. However, sales have soared in the USD10 and above segment, with consumption growing 12.59% in 2007-2011, mainly in China, the US and Canada. Growth in higher priced wines is expected to rise 29.93% in 2012-2016.
France still leads the world in value of its wine exports, with sales of USD9.902 billion in 2011, some 5.24% more than in 2007. Italy and Spain came second and third, but the value of sales grew less than the volumes exported. Revenue was up 24.31% compared with an increase in volume of 47.62%, a clear sign that the average prices of their exported wines fell significantly. The same could be said for Australian wines, up 13.3% in volume but down 20.94% in value between 2007 and 2011, while Chilean wines are pursuing a clear strategy to move up market: up 8.13% in volume and up 33.09% in value over the same five year period.
WINE inventories are expected to remain tight in 2013 despite the pressure that price rises may place on nearterm demand, according to a recent Rabobank report.
US production increased by more than 7%, but production in Europe declined by 9%, although this figure may be understated (FOODNEWS 19 October 2012). In the US most bulk wine prices in December were down 30% from their highs over this past summer, but were still 50% higher than two years earlier. It remains to be seen whether tight supplies in Europe drive an increase in bulk wine
prices in other production regions. Without excess volumes to move, an increasing number of companies have been showing more willingness to sacrifice volumes to support margins, particularly in difficult markets such as the UK (FOODNEWS 12 October 2012). In Australia, the extended heatwave that has affected much of the Australian continent from late December into January 2013 has the potential to moderate production from the 2013 harvest. The New Zealand 2012/13 season is shaping up to deliver a larger 2013 harvest. Despite the anticipated recovery in production, the low level of ending stocks is
likely to support grape pricing in the key Marlborough region. The general sense is that Chile will see a good season. The least optimistic forecasts point to a relatively unchanged crop compared with 2012, whereas the most positive forecast is that last years bumper crop can be surpassed. Argentinas The National Institute of Viticulture published its first estimates of the grape harvest, predicting 26% growth compared with last year. The output increase is largely explained by the absence of adverse weather events such as those seen in 2012, the recovery of vineyards affected by frost and hail last year, good bud burst and fruit set, and timely rains.
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11
6th Global Conference
Join leaders from across the supply chain from all over the world
: SAVE THE DATE

14-16 May 2013, Rome
forum 2013
Delivering Growth by Capitalising on Global Opportunities for Production and Consumption
Very PREVIOUSLY ATTENDED BY: Miller & Smith Foods Inc HJ Heinz good global John Bean Technologies Nestle ConAgra Foods Foods Europe perspective of Mars Food Specialities Sugalidal DSM All Joy Foods Morning Star the market and TheDoria Group Company WPTC La Plus Four Company Ltd Conserve Italia future terms Olam Middle East COFCO Tuhne Co. Ltd
Antonio Coutinho, Factory Manager, Fomento da Industria do Tomate SA
Very well organized, good topics and speakers

Juan Martinez, John Bean Technologies
Italagro California Tomato Growers Association Assan Foods Conserve Italia Tamek Food & Concentrate Inc Ottogi Food Corporation D Nomikos SA Tetra Pak SIG International Services Olam International Ltd Ingomar Packing Company Kagome Co Ltd Fenco spa Ingomar Packing Company
Iri Sementi s.p.a. JSC NC Foodcorporation Conservas Vegetales de Extremadura S A U Ferrera Food Aran Packaging Bosch Boden Spies GmbH Essential Juices & Foods Ltd Agromar AS Campil LDA Tat Konserve Sanayii AS Nunhems Italy SRL Fomento da Industria do Tomate SA
...and many more!

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Organised by the publishers of:
To find out more about our standard options or for a solution tailored specifically to your needs, please contact Gareth Moore at Gareth.Moore@informa.com or call +44 (0)20 7017 7566
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Tomato products
Tomato crop forecasts cautious as end of market inertia still far-off

BY dAVIdE gHILoTTI
THE first WPTC forecasts for the next tomato crop have been released, as the global market is still in the middle of a prolonged idleness that industry sources maintain should have improved by now. With this in mind, production figures for this year appear cautious, while questions remain on when the market inertia will leave room for recovery.
California is expected to increase production by 3% in the 2013 crop, to 11.7 million tonnes. China stands at 4.5 million tonnes, and Italy at 4.6 million tonnes. Commenting on the WPTC figures, a source from Italy noted how restrained they seem to be: As far as I can see, there is no intention of increasing production, even after the small crop of last year. Only California and a few others list an increase, but its a minor difference. Such small variations can vary easily depending on yields. On Italys production forecast, he said: I think 4.6 [million tonnes] could be done, but that depends on the weather conditions, as we have seen last year. The current skirmish between farmers and processors over the raw material price is another factor making the current situation uncertain for Europes main producer (FOODNEWS passim). This all seems very achievable, a Californian source told FOODNEWS on the forecast for the country. Planted acreage is basically flat and expected yields are up slightly to just under 50 (short) tons per acre [45.3 tonnes/ acre]. As for production capacity, most people estimate that the state currently [is able] to produce 14.0 million tons [12.7 million tonnes]. So that will not be an issue. On the other hand, California has had exceptional growing conditions for the last three years. Yields have increased steadily with no setbacks. Sooner or later, well experience a weather event that will cause a reversal in these trends. The big question is when.
Price negotiations are still going on, he added. General consensus is that prices will remain very close to the USD69.40 per (short) ton base of last year. I would be very surprised to see pricing shift by more than plus or minus USD1.00. As regards the WPTC forecast for China, another source said firmly: Its extremely low. Its even lower if we consider the reality of the Chinese industry, where opening and closing plants [according to production plans or to contain costs] is done quickly, and the degree of elasticity is much wider than in other places. And then there are of course other producers, such as Iran and Tunisia, with less than stable political situations. Those together make some three million tonnes, or 10% of global output. What this boils down to, is an enduring stagnation that was not at all expected in the closing months of 2012. Contrary to predictions by industry insiders, the tide is still low, and the WPTC figures do not seem to alter much last years scenario that of a global market supplied with significantly less product than it consumes. We are left with a total production of 35.7 [million tonnes], which can be subject to a -/+5%, taking it to 34-37 [million tonnes] but even the latter figure is well under the estimated total consumption, which is around 40 million tonnes, a source concluded.
CL
Cutting stocks
Stagnating industry
The sector had been expecting a stir in the global market that should have manifested itself by now. After last years global tomato crop fell by 6.0 million tonnes to just over 33.3 million tonnes and product shortages were feared, all eyes were fixed on the price indicator, expecting it to move upwards. At the time of SIAL, last October, Chinese tomato paste had already gained 5%, while a similar trend was expected for European product as well. Over three months later, the
Stocks in Italy are said to be enough to last until July, maybe September this include both 2012 and the remaining 2011 product. Sources in China also told FOODNEWS how stocks there have not run out yet some 160 000 tonnes of product from the 2011 crop are said to be still sitting in storage. The stringent situation of the market and the increasing costs for storage and product upkeep should be pushing the industry to gradually cut down its stocks level. According to some, this is a practical approach that is required to respond to the widespread crisis. Year by year, we should start reducing stocks to contain costs. Storing these amounts of product is not feasible anymore, a source said, adding: If global output were indeed 36 million tonnes as forecast, we will see a total clearance of stocks, while some specific products might go in under-stock.
czech Rep
IC
Bulgaria
stagnating mist that had been enshrouding the market since the end of 2009 has proved harder to dispel than previously thought. The market should have been on the up, and we should have run down the stocks by now, a source told FOODNEWS. This, though, is not happening. The market did not experience the upturn needed to trigger an increase in production. Factors to stimulate the market are there, but an external situation is not allowing this to happen. Prices are still not viable for farmers or processors. A second source agreed: With the global credit crunch situation, producers in Europe such as Italy, but also Spain, Portugal and Greece are experiencing difficulty in access to credit, which is still very tight. Tomato growing is dependent on investment, but these economies are still under the grip of economic instability. I believe the overall situation is due to a negative set of characteristics that are external to the tomato sector itself.
gLoBAL ToMATo pRodUcTIoN (000 ToNNES)

coUNTRY Algeria Egypt France greece Iran Israel Italy Malta Morocco portugal Spain Syria Tunisia Turkey Ukraine Brazil canada california china Japan 2011 280 210 192 324 1850 218 4950 10 178 1065 1985 160 868 1940 440 1590 426 2012 300 210 192 390 1750 200 4500 6 130 1190 1935 50 2013* 300 210 185 420 1800 200 4600 6 130 1200 1800 50
AD
830 1750 385 1294 503 11460 3230 37 22 15 15 165 20 488 31067 360 185 668 125 245 130 90 70 80 40 260 40 2293 33360
LO
27 22 15 63 20 87 40 68 64 90 40
WN DO
11067 6792
TO
Hungary poland
210
Slovakia USA excluding california Subtotal Northern Hemisphere Argentina Australia chile S Africa dominican Rep India Mexico NZ peru Senegal Thailand Venezuela Subtotal Southern Hemisphere ToTAL
SoURCE: WPTC
412 35314
355
794 112 280 130
260
2320 37634
* Forecast
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DA TA
750 2100 400 1670 480 11790 4500 35 30 15 50 165 20 470 33376 420 225 660 115 250 130 90 78 90 40 260 40 2398 35774
13
dried Fruit & Nuts
Stable sultana and raisin prices for Turkey, but 2013 crop shorter
AVERAgE TURKISH dEpARTURE (c) 12/1/2013-10/2/2013
THE Turkish sultana market is stable since the start of this year, with prices remaining static. Type 9 raw material is trading at TRY2.90 (USD1.63) per kg at the Izmir Bourse.
Light colour sultanas are becoming more limited at this stage of the season, while Thompsons from the 2012 crop are scarce due to reduced production. High prices for Californian product have increased demand for Turkish Thompsons, but prices are now steady at USD2 500/tonne levels. Co-operative Tari has bought approximately 42 000 tonnes of the 2012 crop, but is not expected to buy additional quantities from the market this season. Alcohol producer companies have also purchased some 20 000 tonnes. Worth adding is that the current exchange rate between the US dollar and Turkish lira is putting pressure on all export prices.
Yasin Durmus of Turkish sultana supplier Sunrose said: We are expecting a smooth market during February-March 2013, as the demand from buyers is quite good at this stage of the season. By the beginning of April 2013, all eyes will be turned on the new crop developments.
Frankly speaking, we are not so much optimistic about the 2013 crop under current conditions. First of all, the winter is very warm in Turkey presently. It is above 18C in Manisa/Izmir area at the moment, which is not so normal. If the vineyards start with an early bloom, a frost in
March-April period may damage 60-70% of the 2013 crop. This is a quite big risk presently. On the other hand, last years crop was quite big, therefore we are not expecting another big crop for next season in any case. If there are not any negative developments for the 2013 crop, we can expect slightly lower prices than today. However, this is a smaller possibility in our opinion, he said. In response to FOODNEWS queries over weather conditions in the country, Don Keeney of MDA Weathersystems said: It has indeed been quite warm in western Turkey over the past month, with highs reaching near 18C. It has also turned quite wet there. Conditions should remain rather mild and wet early this week, but temperatures should then begin to cool off a bit later this week into next week. Temperatures should actually trend a little below normal next week. Precipitation should also become more limited next week.
Spanish almond prices are up

Bee issues for almond sector

SPANISH almond prices are now above EUR4.0 (USD5.90) per kg, pleasing those in the industry who say the sector has returned to profitability. Marcona is now valued at EUR4.52/kg, Largueta at EUR4.38/kg, and the Common variety at EUR4.18kg.
According to the Lonja de Reus (Tarragona), this is the first time in six years that producers will make a profit. The 2007-11 period was very bad, with prices as low as EUR1.35/kg for the Common variety. The manager of Frutos Secos Alcaiz, Santiago Izquierdo, said: The market is a bit mad with prices that, compared with last year, are one euro higher and 90 cents above that which we started the season with last September. For Izquierdo it is a speculative process that is determined by the increase in north American almond prices. However, a source from the
Union of Farmers and Livestock Owners from Aragon COAG nuts department said that the increase in demand from emerging countries has meant that a portion of the Californian crop is destined for those areas, which has reduced the pressure of Californian almonds on the Spanish market. As this pressure has eased, prices for national product have increased, he added.
CALIFORNIA almond growers may not have enough honey bees to pollinate this years crop of 800 000 acres. This is due to winter losses and less populous hives.
Apiculturist Eric Mussen of the University of California, Davis, told Central Valley Business Times:
Problematic banana chip market

THE banana chip market is still in extreme difficulty. There is no improvement in the supply of raw green bananas, while plants are running on half their capacity which makes it very hard to meet buyers requirements.
Additionally, a rise in the price of coconut oil is also causing problems, prompting banana chip prices to rise yet further.
The situation is only expected to ease in July-August this year. According to QFN Trading, very few banana chips are being offered. There are certainly not [banana chips] for shipment in February anymore, first available shipments will be from mid/end of March 2013. Currently we have the following offers: banana chips whole, sweetened (PAH compliant) for USD1.05/lb cfr EMP, 15 lbs/box for mid-March shipment. Spot material is extremely scarce.
We need 1.6 million colonies, or two colonies per acre, and California has only about 500 000 colonies that can be used for that purpose. We need to bring in a million more colonies but due to the winter losses, we may not have enough bees. San Joaquin Valley almond orchards are already starting to bloom, but its going to be late up here in the Sacramento Valley, Mussen said. Although almond growers are paying a lot of money for their pollination services an average of USD150 per hive there is no guarantee it will be a good nut set. If its too cool, fertilisation may not occur. The pollen tubes wont grow all the way down to the base of the flower to the ovum. The good nut set occurs within the first three days of pollination or at the most, within five days. On the other hand, if the weather is too hot and dry the tissue dries out, Mussen added. Its not always the bees fault if the nuts fail to grow, Mussen added.
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dried Fruit & Nuts
Buoyant raw cashew nut market following trade of African crops

THE international cashew market was quiet in the week commencing 4 February, with offers at the higher end of the recent range. Some business was done in several markets, but the majority of buyers appear to be wary of taking any large positions.
In India the market was very quiet with some declines in prices for broken grades. In contrast, the raw cashew nut (RCN) market was reasonably active, with good volumes of Tanzanian RCN trading at the USD1 300-1 350 per tonne fob range. Mozambique RCN is trading around USD900/tonne. There are reports of some trades for West Africa 2013 crops; Benin/ Ghana product is around USD1 050/tonne, Ivory Coast
around USD950/tonne and Nigeria around USD900/tonne. Initial reports from Vietnam are that new crop RCN prices are around USD1 150/tonne, but a clearer picture will emerge after their New Year holiday. According to a Samsons of Mumbai report, there are some reports that the crop in most origins is early, which indicates a good crop unless something goes wrong with weather in the next six to eight weeks. If the movement from origins does start early without disruptions, shellers should be able to cover RCN at reasonable prices. That would keep kernel prices within the current range maybe even at the lower end unless kernel demand picks up during February-March. On the other hand, if arrivals or movements from origin do not pick up speed
until April, RCN prices will remain firm. This could also mean temporary tightness in kernel supplies for a few weeks. This will keep kernel prices at the higher end of the range. On the demand side, the general feeling is that this year off-take will be better than it was during 2012. If any large scale buying needs to be done before RCN movements are in full swing, prices could reach the top of the recent range. However, if kernel activity continues to be for small volumes at regular intervals, prices will continue to move within the current narrow range. The consensus of views in the industry is that the present range is close to comfortable for all links in the chain. If it goes too high, it will have an adverse impact on demand and if it goes too low, it will have adverse impact on
If the movement from origins does start early without disruptions, shellers should be able to cover RCN at reasonable prices. That would keep kernel prices within the current range.
collection and shelling. Another common interest is to find uses for the lower grades to reduce the differentials and remove the disparity in shelling, the report read. Overall, there is no reason to change our view on market movement for 2013: volatility during February-May with a strong possibility of prices being higher in second half of the year. This is especially true with prices of almost all other nuts showing a firm trend.
Turkish apricot crop likely to be smaller Minor decline

TURKISH apricot prices are slowly increasing, despite subdued demand. Export figures are on average 10 000 tonnes per month, giving the industry confidence that they will be able to shift the large crop.
FOODNEWS prices put Turkish No.4 whole pitted dried apricots at USD2 750 per tonne on 12 February, up from USD2 575/ tonne last month. Last years large crop, and a sizeable crop in 2011, has meant sources in the country are expecting apricot trees to produce less in 2013. Purchases of dried apricots for Ramadan, which falls on 9 July this year, will have to come from the current crop. Meanwhile, the dried pineapple and papaya market continues to be a headache for traders. For papaya especially, delays and defaults are becoming commonplace and the industry will have to wait until October for the new crop to come on stream. For pineapple there may be a small crop in March, but this will
TURKISH No.4 WHoLE pITTEd ApRIcoTS (USd/ToNNE cIF UK)
in nut sales value in Spain
OD CK T CLI
L OWN
TA D DA OA
THE Spanish dried fruit, nut and snacks market grew 1.3% in 2012 to EUR1.8 billion (USD2.5 billion).
Jennifer Willis-Jones writes: DBK analysis revealed that the positive performance was down to launches of higher priced products and an increase in retail prices in line with rising raw material costs, despite a slight decline in demand. By segments, snack sales showed the most growth, registering an increase of 2.4% in value to EUR635 million, with a 33% market share. The dried fruit and nuts and crisps market was worth EUR690 million and EUR570 million respectively, down 1% in each category. The growing bargaining power of an organised food sector is thought to be aiding competitiveness in the industry. Innovation is also extremely important, and food products are now distributed globally. Brazil, Russia, India, China, north Africa and eastern Europe are all good potential markets for Spanish companies.
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SoURCE: FooDNEWS
most probably not be sufficient to meet demand. Prices of pineapple are, as a result, slightly firming. Prune production in the southern hemisphere is a mixed bag. Argentina is looking at a much improved crop from last year, while Chiles crop will certainly be shorter (FOODNEWS passim). Average Chilean prune size is larger this year, and new crop prices are quite a bit higher than those for 2012 product. However, they are still expected to be competitive with Californian prices.
A recent report from Catz International stated that California is also increasing its prices, following a good domestic performance and increased sales to Asia. It adds that over-supply of prunes, which has dogged the industry in recent years, appears to be coming to an end. Prunes have, up until now, been one of the fruits with the lowest return for farmers. Consequently, a number of acres have been pulled out in favour of crops with better returns such as almonds and walnuts.
15
Frozen Foods
Chilean harvest reaches peak, fewer blueberries for freezing

BY dAVIdE gHILoTTI
Wisconsin strawberries crop down

BY dAVIdE gHILoTTI
CHILEs blueberry harvest has been proceeding at a quick pace over the last weeks of January and the first days of February, as high temperatures registered in those districts where the crop is still on-going have intensified fruit picking.
EU MoNTHLY STocKS oF FRoZEN BLUEBERRIES (ToNNES)

120.000 100.000 80.000 60.000 40.000 20.000 JAN 2011 FEB MAR 2012 APR MAY JUN JUL AUG SEPT OCT NOV DEC Es mated for 2013
THE strawberry industry in Wisconsin suffered a 22.5% production decrease in 2012 due to adverse weather conditions that battered fields in key months during fruit ripening and plant development.
According to data released by the USDAs National Agricultural Statistics Service (NASS), Wisconsin strawberry growers ended up harvesting only 610 acres, of the total 720 acres planted. Warm weather in early spring, followed by long-lasting frosts seen until late in the season hindered plant and fruit development. After that, the extreme heat and drought that gripped the region in the summer months proved fatal to strawberries in the countrys fields. Average strawberry price in the state fell from USD1.61 per pound in 2011 to USD1.51/lbs last year, data report. Extreme weather conditions were blamed also for causing the sharpest decline of the cherry crop in neighbouring Michigan seen in a century (FOODNEWS 5 February).
Exports of fresh blueberries have increased significantly compared with earlier season estimates, according to the most recent crop report released by the Chilean Blueberry Committee. This, the organisation notes, is not only due to harvest reaching its peak in some areas, but the difference is due to less amount of fruit being destined to freezing. The volumes of fruit for the frozen industry have been between 20-30% less compared with the previous season so far, wrote the Committee. The smaller volume is associated with
SoURCE: Chilean Blueberry Committee
high stocks in the EU and with low prices paid to producers. [The latter factor] generates a small interest in this option and, consequently, has motivated a steer towards the fresh market. Figures show that stocks of frozen blueberries in the EU were 77 300 tonnes in December. This is 13% less than November, but 23% more than the same period in 2011. Stocks are thought to be
Pest warning for Utah crops

BY dAVIdE gHILoTTI
The spotted wing drosophila, a nomadic insect that originated in Asia, has been damaging fields in other states so far, such as blueberry crops in Michigan (FOODNEWS 3 November 2012). According to recent figures, the insect is now present in 30 US states. In Utah, drosophila had so far been limited only to Davis County, where it first arrived in 2010; it is feared that it would now expand to other counties in the state. Free workshops will be held in the coming weeks for farmers, gardeners and the public to inform them about the pest. The threat to crops, as explained by Cory Stanley, a
FARMERS in Utah have been warned about the threat of an invasive fly that is spreading from neighbouring states and has the potential to destroy entire crops, from raspberries to peaches and cherries.
drosophila expert with the USU Extension Service who will chair the free workshops, is high: [The drosophila] attacks pretty much any soft-skinned fruit or vegetable raspberries, blackberries, cherries, peaches and plums in Utah. In other states, especially in the Pacific north-west, it has had devastating effects on their tree fruits and their raspberries, so we really do not want it take hold and spread. Still, she conceded that if the fly does spread to other parts of Utah, eradicating it is unlikely at best: I dont think we could keep it out, but I think we could have some hope of keeping it under control so it doesnt wipe out entire orchards. Far from being a mere nuisance, the consequences the drosophila can have on the agricultural sector are severe; according to estimates, the insects damage to US blueberry crops in 2012 alone (in those areas where the insect has so far been present) was USD27 million.
69 500 tonnes, as of January 2013. It is expected that the exports curve of fresh produce will return to lower levels over the coming weeks; with that, the amount of raw material going for processing should increase. The harvest is complete in the northern districts, as well as in central Chile. Legacy, Brigitta and Brightwell varieties are still being picked in central-southern districts, while southern areas are completing the harvest for Teodoro Schmidt and Freire varieties these mainly go for IQF.
Findus frozen lasagne recall

BY dAVIdE gHILoTTI
FROZEN foods company Findus has issued a recall of its whole beef lasagne range across the UK and Ireland, after laboratory tests conducted in the wake of the horsemeat scandal found products belonging to this range to contain meat types other than beef.
While stressing it is only a precautionary measure, the company has co-ordinated full withdrawal from all retail points of its Findus beef lasagne packed in 320g, 360g and 500g containers. Findus UK issued a statement to FOODNEWS explaining that recent testing found traces of horsemeat in the products on sale: At Findus UK we are committed
to our customers and the quality of our products. Following a thorough investigation, Findus UK can confirm that testing of its beef lasagne, produced by a third party supplier and not by Findus, has revealed some product containing horse meat. We understand that, while this is by no means a food safety issue, it is a very sensitive subject for many consumers and we would like to reassure you we have reacted immediately. We are confident that we have fully resolved this supply chain issue, concluded the statement. Customers with inquiries about the Findus products are encouraged to contact the company customer care line at 0800 132584 (UK), or 1800 800 500 (Republic of Ireland).
16
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Business Intelligence
Chinas food industry expands to handle increased urban affluence

BY LoUIS HARKELL
CHINAs food industry is still experiencing respectable growth in an economy that has been less robust than in recent years. Urbanisation levels tipped over 50% in 2011, marking a watershed moment in how China is catering for its vast population.
However, the balance between food processing and food manufacturing still lags behind that of developed countries despite ongoing consolidation, according to a report by the USDA. Fuelled by various measures following the outbreak of the global financial crisis, including the Four Trillion Stimulus Plan (USD588 billion), Chinas economy returned to GDP growth rates above 10% in 2010, but slipped back below this level in 2011 as the government refocused its efforts to fight inflation. In 2011, food industry sales values climbed to CNY6.9 trillion, representing a growth of 28% over 2010. This CNY6.9 trillion in sales, it should be noted, does not include firms with annual sales revenue of less than CNY5.0 million. While sales increased, the total number of food operations dropped, signalling both a difficult economy and ongoing consolidation of the industry. By 2012, economic conditions worsened, with a number of food manufacturers reporting growth rates in the range of 10%. The trend of consolidation is
caused by high food inflation, soaring labour costs, rising entry costs for new companies and tightened bank loan requirements for small sized enterprises. In 2011, food sector CPI exceeded 12%. Accounting for the rapid increase in food prices, the growth in sales values may have been closer to 20%. The number of food firms declined to 32 000 from the peak number of 41 000 in 2010. This consolidation will help the Chinese governments efforts to improve food safety and quality by making it easier to monitor industry activity using standardised practices. This trend will also support increased imports of ingredients, as larger companies seek to distinguish themselves and are able to invest more in product development. Despite its huge size and rapid growth, Chinas food industry has yet to achieve a balanced development. The food processing sector, which is supposed to decline in overall importance with development of the industry, as has happened in developed countries, remains dominant in size compared with the other sectors. Output value of manufacturing sectors versus that of processing sector remains 2:3, far behind the average ratio of 3:1 in developed countries. Of the various causes, the central governments emphasis on food security and the strategy of size first have channelled more investments to agricultural production and food processing, rather than to food manufacturing.
gRoWTH oF FIRMS IN cHINAS Food SEcToRS 2005-11

45000 40000 35000 30000 25000 20000 15000
Food processors Food manufacturers Beverage manufacturers

22800 25612 ATA AD D 20895 LO 24550 9152 6371 2010
WN O DO CK T 10000 LI C 5553 6056 6644 8109

14575 16356 18140 5000 0 3519 2005 3914 2006 4422 2007 5411 2008
SoURCE: China Statistical Yearbook 2006-2012
8739 5504 2009
6870 4874 2011
However, large Chinese companies are tapping overseas manufacturers in order to supply growing domestic consumer demand for processed foods, with Bright Foods acquisition of a 70% stake in UK-based Weetabix a prime example.
Driving forces
gRoWTH oF SALES VALUES IN cHINAS Food SEcToRS 2005-11 (RMB100 MILLIoN)

70000 60000 50000 40000 30000
Food processing Food manufacturers Beverage manufacturers
27961 LOA 23566 OWN D 20000 TO 17131 ICK 12695 CL10366 4602 5853 7464 9219 10000 0 3666 3055 3925 4994 6138 7465 2005 2006 2007 2008 2009
DATA D 34928
11351 9153 2010
43282
13766 11598 2011
SoURCE: China Statistical Yearbook 2006-2012
Disposable income and urbanisation are the two most powerful factors driving the development of Chinas food industry. The number of urban households earning more than USD5 000 a year is estimated to grow annually by 24%, creating tens of millions of new consumers for high-value and imported food. In November 2011, Xi Jinping, the newly elected secretary-general of the Communist Party, proposed doubling average incomes by 2020. Food safety is playing an ever greater role in building demand for high quality food ingredients and manufactured foods. There are also changes in the retail environment and a growing trend toward overseas acquisitions by Chinese food processors (FOODNEWS 28 September 2012). Lastly, this urban group is turning to more heavily processed foods to save time on food preparation. Despite the rise in incomes, rising consumer prices over the past two years have effectively reduced the growth of purchasing power to one third of the income growth rate. For instance, actual disposable income in 2010 was pulled down to 8% from 11% when the increase in the CPI was factored in and that of 2011 down
to 10% from 15%. Price increases have affected food more than other products: for instance, in 2011, food CPI was as high as 12%. Continued runups in food prices are likely to cause consumers to seek more ways to economise in the future. With urbanisation deepening, the traditional preference for fresh food and wet markets will keep giving way to processed foods and supermarkets, and this has had profound implications for Chinas demand for processed foods.
National Foods
It is reported that functional food alone in 2011 generated a sales value of over CNY260 billion. Interest in natural foods and ingredients is becoming a trend that powers innovation in Better-foryou (BFY) food and beverages, with affluent consumers are willing to pay premium prices for branded products, and be receptive to new flavours from overseas. A growing percentage of that amount is spent on imported products and products with imported ingredients, such as dairy products, snack foods, tree nut products and confectionery items. Consumers carefully check nutrition labels on packages to find signs to convince them to buy. The wording no food additives, no fragrance, no preservatives, organic, green, no trans-fat acid, 0 cholesterol, whole-grain are seen more and more frequently in packages, while low-sugar or sugar-free, low-salt are also favoured.
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17
News In Brief
Payout over pro-biotic
GENERAL Mills, Inc. has agreed to pay USD8.5 million to settle a class action lawsuit accusing the Minneapolisbased company of falsely advertising the digestive health benefits of its Yo-Plus probiotic yogurt. General Mills no longer sells Yo-Plus. The class action complaint alleged General Mills had no scientific support for Yo-Plus digestive health advertising claims and that alleged misleading advertising messages allowed General Mills to charge up to a 44% price premium for Yo-Plus over Yoplait Original brand yogurt. As part of the settlement, consumers who purchased Yo-Plus in the US between 26 July 2007, and 5 July 2012, will be entitled to USD4.00 each for each unit they purchased, up to 13 units.
Royal Ahold sells shareholding in giant Swedish food retailer

BY LoUIS HARKELL
HAKON Invest, the minority owner of Swedens largest food retailer ICA, has agreed to take full control by acquiring partner Royal Ahold NVs 60% stake for NOK20 billion (USD3.1 billion).
it wants to focus its expansion on businesses it controls. The retailer isnt disclosing the value of its capital gain on the sale, spokesman Jochem van de Laarschot said.
Simpler Structure
UK sales manager
WAYNE Smith has joined raw material juice supplier Gerald McDonald & Co Ltd as UK sales manager, with effect from January 2013. Previously with SVZ UK Ltd, he has been in the juice and pure industry for eight years and will be handling the sales of the companys citrus, soft and exotic juice products. His appointment follows a GBP700 000 (USD1.1 million) blending station expansion that was completed in December 2012 at the companys site in Essex.
The purchase will secure Hakons future ownership of the 2 215-store chain and clarify ICAs ownership structure, the Solnabased buyer said in a statement. For Ahold, the owner of Albert Heijn stores in the Netherlands and Stop & Shop in the US, the disposal represents one of the last steps in reversing its acquisition strategy of the previous two decades. We think its the right deal for our shareholders at this time, said Ahold chief financial officer Jeff Carr. ICA as a business is doing really well and thats reflected in the price of this transaction. Should anything go wrong in the transaction, an IPO of the stake is something that we could fall back onto and its something we will continue to look at, Carr said. Ahold, which was on the brink of bankruptcy a decade ago partly due to overstating its revenue from the ICA venture, is selling because
We gain a simpler structure and a greater resolve in the organisation, Hakon Chief Executive Officer Claes-Goran Sylven said in a statement. Due to the bridge financing and subsequent share issue, Hakon said it wont pay a dividend this year. ICA had sales last year of NOK96.9 billion, according to
Ahold. The business also operates Rimi stores in Norway and the Baltics. After completion of the deal, Hakon will change its name to ICA Gruppen and Per Stroemberg will be its chief executive officer. Ahold chief executive officer Dick Boer has expanded Ahold by buying online retailer Bol.com, adding C1000 and Jumbo stores in the Netherlands and acquiring Genuardi shops in the US. The executive said in November 2011 that he will open a minimum of 50 supermarkets in Belgium in the next five years.
Peruvian firm buys into Brazil

ALICORP, a leading Peruvian food company, has arrived in the Brazilian food market with the purchase of a 100% stake in Brazils pasta and juice powder producer Pastificio Santa Amalia for BRL190 million (USD96.30 million).
Vladimir Pekic writes: the transaction was conducted through Industrias Alicorp do Brasil, an Alicorp subsidiary set up in Brazil. Pastificio Santa Amalia has a diversified portfolio that includes pasta, canned products, powdered juices, desserts, biscuits, sweets, French fries, as well as third-party products sold through its distribution channels. Its 12-month revenues in 2012 totalled approximately BRL573 million. The company exports its products to 13 countries, including to the USA, Spain and Portugal. Alicorp, which is headquartered in Peru, has operations in four other Latin American countries, including Argentina, Chile, Colombia and Ecuador. Alicorp, which exports its products to more than 23 countries, reported revenues of USD1.62 billion between October 2011 and September 2012.
Heineken silent on Hartwall sale rumour

GBP500 million (USD788 million) sale of Hartwall, with buyout firms expected to lead suitors. Heineken Spokesman John Paul-Schuirink confirmed the strategic review but refused to
BY LoUIS HARKELL
New AIB head

The AIB International Board of Trustees has selected Andre Biane as president and chief executive officer of AIB International. He will succeed James Munyon, who is retiring after serving as president and chief executive officer of AIB International for the past eight years. Biane was selected following a five-month, nationwide search. Biane has more than 30 years of experience in the food industry.
HEINEKEN is working with JP Morgan as it begins a strategic review of its Finnish business, and PepsiCo licensee, Hartwall but refused to comment on rumours of a potential USD788 million sale, according to BeverageDaily.com.
Dutch brewer Heneken announced the strategic review which it expects to finish by the end of 2013 and said it would evaluate options to drive growth for Hartwell, either within Heineken or without. UK newspaper The Sunday Times ran a business digest story on 3 February claiming that Heineken had appointed bankers JP Morgan Chase to oversee a
comment on the details included in The Sunday Times. But he said: The business is profitable and has a solid performance, so it is by no means in distress or anything. Its a solid and profitable business.
EU first for stevia in alcohol

HEINEKENs Finnish business Hartwall claims to have launched the EUs first alcoholic beverage sweetened with stevia onto the nations market this month in the form of a light long RTD.
only 35 per 100ml serving. Hartwall said that Finnish consumers who appreciated lightness and naturalness would enjoy the drinks fresh and genuine cranberry flavour, with the stevia-based launch tapping consumer demand. Produced via fermentation, the drink is sweetened with sucrose as well as steviol glycoside, although Hartwall said sugar was still needed to create the genuine fresh taste of a long drink.
Louis Harkell writes: Original Cool Grape Cranberry 4.3% is described as a light, long drink with the taste of cranberry that contains 30% less calories than an ordinary cranberry long drink:
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Coca-Cola profits increase on non-carbonates but EU falters

BY LoUIS HARKELL
COCA-Cola said fourthquarter profit rose 13% as sales of non-carbonated drinks in North America such as Powerade helped counter lower demand in Europe.
Net income climbed to USD1.87 billion while revenue advanced 3.8% to USD11.46 billion, or rose 5% on a comparable currency basis. A year earlier, net income totaled USD1.66 billion, on revenue of USD11.0 billion. Chief executive officer Muhtar Kent is working to meet growing consumer demand for healthier beverages with products such as Simply Orange, Honest Tea and Powerade. North American volume sales rose 1% in the quarter. Sparkling beverage volumes in the region declined 2%, while still beverage volumes advanced 8%, driven by demand for the Powerade energy drink. Iced tea volume was up 16%
in the fourth quarter, led by brands such as Gold Peak and Honest Tea, while bottled water volume rose 12%. Fizzy drinks in North America posted a 2% decline. The sluggish European economy damped demand in the region, where volume sales declined 5% in the quarter. Euroarea economic data due this week is expected to show the worst quarterly decline in output for almost four years. Sales in China were 4% lower in the quarter after growing by 10% in the October-December period in 2011. For the full year the company reported worldwide volume growth of 4%. In key emerging markets the company delivered volume growth such as Thailand, up 22%, India, up 16% and Russia, up 8%. Worldwide brand Coca-Cola volume grew 3% for the full year, with growth in India was up 33%, Thailand 31%, Russia 20%, the Philippines 8%, Brazil 3% and
Mexico 3%. Its flagship cola posted a 32% volume increase in India and 19% in Russia. The companys net income for the year rose by 5% to USD9.01 billion, as against USD8.58 billion in 2011. Global diversification continues to pay dividends for the company even though you might have a little bit of softness in some regions like Europe, China or North American carbonated soft drinks, Thomas Mullarkey, an analyst for Morningstar Inc. said. Its still able to grow unit case volume globally. Coca-Cola said it sees commodity costs being less of a headwind. Projections are that its bill for sweeteners, juices, metals and plastic will rise USD100 million, less than half of the increase in 2012. Gross margin fell to 59.6% from 60.1%, partly due to a 4% increase in concentrate sales. The company, which now bottles about 80% of its drinks
volume sold in the US, announced it was paring the number of distribution regions in its bottling unit to cut costs and improve efficiency. Kent has worked to restructure distribution in the US since buying the North American operations of Coca-Cola Enterprises Inc. in 2010. The Coca-Cola Refreshments bottling unit will be reduced from seven into three regional territories East, Central and West. Talking to Bloomberg, Kent said that there would be a meaningful role for partners to take over pieces of the North American bottling operation Coca-Cola now owns. He said such a move may happen within another two to three years. The outcome may look different than in the past, he said, when franchise bottlers bought the rights to do everything from package to merchandise CocaColas products in a given territory. This will not necessarily look like a full template of a traditional refranchising, he said.
FREIgHT REpoRT: EAST ANd gULF coAST poRTS STRIKE AVERTEd

BY STUART Todd
MEMBER lines of the Transpacific Stabilisation Agreement (TSA) are recommending an across-the-board GRI on all dry and refrigerated cargo, effective 1 April, 2013, of USD400 per feu to the US West Coast and USD600/ feu to all other destinations.
They say freight rates remain below compensatory levels despite previous adjustments and want to ensure that 2013-14 contract rates contain meaningful net increases relative to 2012 contract levels. The week-long Lunar New Year factory closures in Asia tend to pull forward spring shipments, especially among retail customers, explained TSA executive administrator, Brian M. Conrad. This translates into slowing cargo demand after the holidays, and is one of many such inflection points that can erode revenue throughout
the year. Carriers are committed to keeping market rates stable over the next six to eight weeks, as the contracting season ramps up. As for the spot rate Indexes, the WCI Shanghai-Rotterdam component was down 1.3% last week while minor erosion continued across the main trades on the SCFI. The SCFI was widely expected to slip down further as activity in the East slows for the Chinese New Year holiday. Perhaps less expected was that sellers would hold their ground on the AsiaEurope contracts, following additional carriers announcing GRIs for 15 March, commented Ben Gibson, a Container Freight Derivatives broker at Clarkson Securities. Although there is more buying interest to be found on the Q2 and Q3 now the threat of an increase is there, concern over the shipping lines willingness to remove capacity is keeping the forward prices from rising too much.
WoRLd coNTAINER INdEXS SHANgHAI-RoTTERdAM coNTAINER FREIgHT RATE

3700 3500 3300 3229 3128 3521 3411 3489 3333 3112 3496 3379 3189 2928 2865
3100 3225 2900 2700 2500 2300 2100 1900
3018
2802 2675
2749
2727 2699
2724
2578
2542 2396 2223 2263 2185 2106 2077 1990 1935 2134 2416 2464
2505 2397
2472
USD per fcl, excluding terminal handling charges
SoURCE: World Container Index assessed by Drewry, www.worldcontainerindex.
The main talking point on AsiaEurope routes remains the March GRI, announced by a growing number of carriers and ranging between USD600-775/teu, and the prospect of it being successful. Broker GFI argues that regardless of whether the GRI sticks or not, the mere fact that the question is there at all is justification enough for shippers to hedge. Far too often we hear of
clients whove had their fingers burnt by freight rate volatility, yet still there are those who remain reluctant to do anything about it, said GFI. Looking at the rates available in the forward market today, shippers have the facility to hedge themselves against paying the full GRI in March by buying a derivative contract for April at roughly USD100/teu premium over todays rates.
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19
Weather Watch
Below normal rainfall for Florida; heavy snow across New Jersey
BY MdA WEATHERSYSTEMS
IN CALIFORNIA, rainfall was below normal across the San Joaquin Valley over the past month, ranging from 10-40% of normal across the region. This continues long-term dryness across the region, with moderate to severe drought conditions in place as per the USDA.
Dry weather is expected to continue this week, with a chance for light showers in the Week 2 period. Temperatures will be mainly near normal this week. Temperatures look to fall below average in the Week 2 period, but significant cold is not expected at this time. Rainfall was well below normal across much of Florida over the past month, with much of the state receiving less than 20%
of normal rainfall. This continues dry trends of the past couple of months, though only the Panhandle is in a moderate drought as per the USDAs Drought Monitor. Rainfall is expected to increase over the next week, particularly in far southern Florida and in the Panhandle. Showers may continue in the Panhandle in the Week 2 period as well. In the north-east, very heavy snowfall was seen in the last week,
and overall precipitation has been above normal in the past month in eastern Pennsylvania and New Jersey and near normal in much of New England. Models show the possibility for wintry weather affecting eastern Pennsylvania and New Jersey this weekend, though they have been inconsistent and confidence is low. Increased precipitation is possible in the Week 2 period.
SoUTH-WEST US ToTAL pREcIpITATIoN (MM) 10/12/2012-2/10/2013
SoUTH-WEST US MEAN AVERAgE TEMpERATURE dEpARTURE (c) 10/12/2012-2/10/2013
SoUTH-EAST US MEAN AVERAgE TEMpERATURE dEpARTURE (c) 10/12/2012-2/10/2013
SoUTH-EAST US ToTAL pREcIpITATIoN (MM) 10/12/2012-2/10/2013
Why choose EarthSat?
CONTACT US:
We are the industry leader in global agricultural and Chris Hyde energy forecasting CropCast Marketing Director Our forecasts and products set the industry baseline and Christopher.hyde@mdaus.com allow our customers to stay ahead of the competition Phone: 240-833-8322 Our GIS capabilities allow us to innovate and bring new Don Keeney products to the market Senior Ag Meteorologist We provide the fastest and most reliable delivery Donald.keeney@mdaus.com All of our products are always backed by our unparalleled customer service, with experienced meteorologists available 24/7 Phone: 240-833-8300 24/7
20
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Market data
EU-27 SoFT dRINKS IMpoRTS, FULL YEAR (LITRES)
220290 Swland Taiwan Thailand Turkey Serbia US S Korea 2007 55495408 6260239 6439286 6909467 1509266 8662259 3835711 2008 56019097 7639492 6867179 9273277 1941156 10178972 5262265 2009 41010909 8658716 5391452 9290576 3215516 9184006 2010 42125057 12630165 6244446 8700197 7497374 2011 43986591 15159003 7321674 9658661 6532418 2012 46052383 19975078 12057966 11625862 11444655
BRAZILIAN SoFT dRINKS IMpoRTS, FULL YEAR (LITRES)

220290 Malaysia Austria Swland Italy 2007 0 15276300 0 729 2008 0 24020465 0 4320 2009 0 30530191 179816 432 2010 18864 38787186 2240721 172 2011 36900 45323697 4665982 2012 56686320 40334503 6015860
6959320 OWN 7808234 OD china 4014462 CK T5832129 5229406 CLI Ukraine 8876311 8562703 5697237 Egypt 6169879 6417123 croatia Malaysia others Total
SoURCE: Eurostat
9967393 10709348 DATA AD 9638902 10329950 O 9379861 L 9431391 6577414 4379281 7161432 1561974 2403597 45317205 163409394 6015307 3890629 5127840 3282553 3954826 40610248 165146045 5987019 5549310 4788879 4188779 3699472 42526680 188935381
50587 568891 DATA245357 OAD Argentina 1236259 2224728 1629987 L 238680 W0N 3555949 1438030 133920 DO Hungary 0 0 0 0 TO germany 5250 LICK 69120 62499 70666 68750 120824 C Taiwan 0 0 16319 53354 74984 103714 US 56998 321082 225008 332077 673350 chile S Korea poland others Total 493626 23351 66000 98494 17257007 225216 142148 82800 180503 27270382 110040 40238 82800 177031 33054361 111000 49092 66240 300410 45585731 43800 43750 66972 476042 52962844 81600 69304 66240 387195 105052408
558503 3395249 54769126 166895166
746635 2488233 51180651 172408912
1357499 2076551 45642014 151521436
SoURCE: SECEX - Foreign Trade Secretariat
US SoFT dRINKS IMpoRTS, FULL YEAR (LITRES)

220290 Thailand Mexico S Korea Taiwan canada Brazil 2007 45049410 153310597 21216191 9544317 15371139 1193297 2008 40572022 130726828 28378449 9600569 12415881 3194655 2009 38899125 109049466 32473417 9218079 9275747 4102037 2010 50753785 103721514 41966306 13418161 2011 77993516 93885313 44516486 14910065 2012 108145740 94614963 65237807 17773323
JApANESE SoFT dRINKS IMpoRTS, FULL YEAR (LITRES)

220290 Swland US china 2007 37068 12180015 16271679 3776756 2008 42840 11432905 5724023 2009 24294 11754059 3364269 2010 3986897 11363465 5071543 2011 18622369 10392701 6460150 2012 26710931 26610325 24142174
8763666N 10282153 W O DO phppines 3554891 1699417 2007823 2050162 T ICK 6766411 5292363 8593446 El Salv CL 3783779 germany 10795570 9476566 china Indonesia Japan others Total 10288409 112560 4304259 81031799 359556218 9384579 115548 4737970 66077829 323146724 4473127 203779 4272125 55437493 283468247 3670622 305307 5023435 59337277 315446360
11952982 TA DA 16567677 AD4337471 12143770 LO 12021404 4302788 10678988 2067326 10551115 4977134 1185305 6141811 59077475 342274987 11551700 11376093 11325087 9652718 8030675 6860699 63948458 437228710
18124351 DATA D11066157 13785304 A Taiwan 1296691 1990587 7008863 4828184 NLO Austria 2253678 4688419 OW D 7046700 8322321 833570 2384114 O 1435304 1601692 1529888 1815787 Spain 1542490 T 1173444 ICK 2870019 2196138 1220404 2872035 1626810 CL 3009841 germany S Korea 2463714 3842703 7393517 14103474 France phppines Thailand Nlands others Total 365405 1874691 1411642 22544183 2433196 68997335 396274 1704128 1136843 1927175 2759580 38309951 331004 1161541 968253 1595114 2205806 42934048 543355 1350253 906239 1172431 1589910 49350211 899775 1260450 867828 1024286 1878027 71810710 1318472 1182018 1157759 989061 2503005 122350111
SoURCE: US Department of Commerce
SoURCE: Japan Customs
cANAdIAN SoFT dRINKS IMpoRTS, FULL YEAR (LITRES)

220290 US Thailand S Korea HK Taiwan 2007 175422972 3002858 2449213 2110513 1523677 2008 210438314 2637371 2781804 3166157 1409458 2009 216882247 1958772 2946930 3094833 1411218 2010 215479870 2839949 3489494 3230232 1877374 2011 229901552 4475608 3506873 3027692 1988248 2012 220772734 6685933 4632562 3303682
Asian soft drinks win markets

THERE was a marked increase in the quantity of soft drinks imported into the EU-27 last year.
Imports totalled nearly 189 million litres, the highest volume for at least six years (and possibly longer). This rise came on the back of vastly increased shipments from Turkey and (especially) Serbia, whose sales to the EU doubled. Switzerland still remains the biggest extra-EU supplier, due to its different duty regimes. Brazil has also seen a huge surge in imports, which doubled last year to 105 million litres (and this despite the countrys own buoyant domestic industry). Massive shipments from Malaysia are the reason for this. The Far East is also supplying the US with more product: Thailand exported over 108 million litres to the US last year, a 38% volume increase over 2011. Thailand is also increasing its penetration of the Canadian market, although total Canadian imports fell by 4% to just over 258 million litres from about 264 million litres in 2011. Meanwhile, South Korea saw its volumes exported to the US rise by almost half to 65 million litres from 44 million litres in 2011.
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2899114 DATA2769519 AD 1783900 2761067 phppines 1917950 1769623 1373552 L1590601 N O W France 1696153 910110 O DO371935 500102 699646 2339280 T1324612 1116685 1544503 1834265 1747839 K china 1420126 CLIC Egypt 881013 965307 1187573 1215753 1407583 1733327 germany 2353592 2643722 2397186 2567563 3576140 India Italy others Total 841185 863394 4861662 199344308 688283 1159288 4567590 234461639 1319006 773684 6244949 241078570 953257 932801 28794966 265016465 1030248 743216 15381875 269356846 1280280 1076635 6089823 258091795
SoURCE: Statistics Canada
21
Market data
LEAdINg US SoFT dRINK IMpoRT oRIgINS BY VoLUME (FULL YEAR, LITRES)
180000000 160000000
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LEAdINg EU-27 SoFT dRINK EXpoRT MARKETS (JANUARY-AUgUST, ToNNES)
140000000 120000000
140000000
120000000
100000000
80000000
60000000
40000000
TA D DA OA WNL DO K TO CLIC
2002 2003 Thailand 2004 2005 Mexico 2006 2007 S Korea 2008 2009 Taiwan 2010 2011 Canada 2012
100000000
80000000
60000000
40000000
20000000
20000000
OW TO D K CLIC
2002 2003 Saudi Arabia 2004 2005 US 2006
NL
TA D DA OA
0 2007 Angola 2008 2009 Sw'land 2010 2011 Libya
SOURCE: US Department of Commerce
SOURCE: Eurostat
AVERAgE UNIT VALUE oF US SoFT dRINK IMpoRTS (FULL YEAR, USd/LITRE)

2.5
AVERAgE UNIT VALUE oF EU-27 SoFT dRINKS EXpoRTS (JANUARY-AUgUST, USd/ToNNE)

1.8 1.6
1.5
0.5
ATA AD D LO OWN OD CK T CLI

Thailand 2007 Mexico 2008 S Korea 2009 Taiwan 2010 Canada 2011 World Average 2012
1.4 1.2 1 0.8 0.6 0.4 0.2
OW TO D K CLIC
Saudi Arabia 2007 US 2008 Angola 2009
NL
TA D DA OA
0 Sw'land 2010 Libya 2011 World Average 2012
SOURCE: Eurostat
MARKET SHARE oF US SoFT dRINKS IMpoRT oRIgINS (FULL YEAR, 2012)
MARKET SHARE oF EU-27 SoFT dRINK EXpoRTS (JANUARY-AUgUST, 2011)

Thailand 24.7%
Philippines 2.6%
Germany 2.6% Brazil 2.8%
ATA AD D LO OWN D K TO CLIC

Others 20.2% Taiwan 4.1% Mexico 21.6%
El Salvador 2.6%
Saudi Arabia 12.2%
W O DO KT CLIC
Others 43.5%
ATA AD D LO
US 9.8% Angola 9.0%
Canada 3.8%
Sw'land 7.7% Ghana 3.9% Libya 6.1%
S Korea 14.9%
SOURCE: Eurostat
Others 2.4%
Ceuta 2.6%
Canada 2.7%
NEIGHBOURING Mexico is no longer the major supplier of soft drinks to the US, having been overtaken by Thailand last year.
Thailands rise as a supplier of soft drinks is truly remarkable, given that it is exported some 108 million litres in 2012, compared with 24 million litres in 2002. Its share of the market is now 24.7%, leaving Mexico with a 21.6% share. South Korea has followed a similar trajectory to that of Thailand when supplying the US with
soft drinks and there is no reason why it shouldnt follow the same meteoric rise; data reveals shipments shot up dramatically in 2011-2012. Market share is currently at 14.9%. Worth highlighting is the sharp increase in average unit value of soft drinks from Canada last year which, at USD2.31/litre, brought up the world average for 2012. Falls were seen in Thai and South Korean product, probably fuelling their popularity as a supplier to the US.
SAUDI Arabia is the leader in terms of export markets for EU-27 soft drinks for the January-November period, but only with 12.2%, ahead of the US with 9.8%. African country Angola and the Middle Easts Libya are surprising top five entrants given their small population size, and in the case of the latter, the recent political turmoil.
Saudi Arabia has seen off-take increase the most in the past two
years, taking it from fourth place to first. The volume rise is due to the increasing size of the middle class in the country and large expatriate population. As regards unit value, the world average was USD1.27 per litre, down from USD1.30 in the year ago period. Switzerland saw the only rise in values to USD1.33 (also the most expensive) from USD1.31. While Libya saw volumes increase in 2012, value dropped the most to USD0.81 from USD1.11.
22
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NoRWEgIAN MINERAL WATER IMpoRTS (FULL YEAR, LITRES)
220190 Sweden denmark poland germany Italy US UK N'lands Finland Austria Albania Japan others Total 2007 11782784 397778 0 927 28413 2929 2008 13779523 137483 0 372 486 2009 10538862 52683 612 2592 383 2010 9252830 13003 22920 864 2011 7980246 148601 20500 576 2012 7026233 153830 63504 19552
Market data
SINgApoRE MINERAL WATER IMpoRTS (FULL YEAR, LITRES)
220190 Malaysia Australia Norway Indonesia Turkey Japan Thailand Italy china UK Taiwan France others Total 2007 56128495 12132 0 15482 0 0 2008 55343977 0 9975 212 16548 2009 64869270 1512005 102105 12 0 2010 84727274 1904718 154341 70573 0 2011 109366258 2208000 212321 0 2012 170176079 2304005 267240 204842
L 1300 0 OWN 76558 11416 1124271 TO D 370966 0 2619 9990 ICK 1252 CL 0 0 0 400
17800 120 0 3000 36784 12264151 0 0 0 112437 15173624 0 0 0 75315 11044032 0 0 7680 2069 9391508
TA 444 D DA 18798 OA
3894 104 14782 7405 7098 1286 188 45 0 0 7312721 16390 333 2240 40 0 0 2088 8171562
T 0 LICK C
0 0 17856 0 2551 5588 56182104
5030 L 22083 OW1N 52022 O57D 12743 0 0 69969 0 1200 0 606 2953 799893 84263 47 0 28883 67401509 658552 42097 10 8597 569 87710805
TA 0 D DA 125526 OA
34 0 33552 15500 30237 40 10270 18962 111895174 60186 19000 13989 13452 12493 4554 3600 6986 173211952
55388271
SoURCE: Statistics Norway
SoURCE: International Enterprise Singapore
JApANESE MINERAL WATER IMpoRTS (FULL YEAR, LITRES)

220190 US canada Malaysia Singapore 2007 74306090 1089397 278666 0 2008 74209352 813576 212107 0 2009 63160246 1010717 234574 0 2010 52799619 725231 253942 0 2011 94787330 796643 2996065 2012 120668354 550564 522040 92160 86304 15840 15681 12800 6300 2520 340 80 0 121972983
cANAdIAN MINERAL WATER IMpoRTS (FULL YEAR, LITRES)

220190 US Sri Lanka Norway germany 2007 21081397 480 58520 2158 2008 17373760 0 11705 466 2009 15772335 564 17378 3546 2010 6624738 0 21371 7064 2011 16884920 0 14760 7718 2012 10457009 34028 20929 20128
19080 43200 DATA AD Taiwan 802740 210240 0 NLO 0 5084909 W china 226800 14388 O 0 191673 TO D 226800 34200 1697394 S Korea 44002 0 17400 ICK CL 885 Norway 3630 0 6480 11880 Thailand 0 2227 0 0 France oman denmark others Total 0 0 0 63093 76811673 0 0 0 58999 75524519 0 0 0 78539 64728276 874 0 90 56054 53876490 0 0 0 104742 105732916
TA 17981 D DA 12157 canada 1469 235 369 19407 912 OA WNL 5228 UK 8527 3710 O 3916 9308 8872 D Ukraine 13848 9600 1800 6624 6952 3372 K TO LIC 0 poland C 0 0 5557 452 2531
china 255187 3186 6538 3240 9116 Ireland denmark Turkey others Total 0 19 142 4094527 25516274 0 5763 136 204121 17612682 0 360 124 398277 16205207 0 771 0 224834 6918834 0 9934 0 89179 17033251 2365 1684 1312 6423 10588791
SoURCE: Japan Customs
SoURCE: Statistics Canada
FRENcH MINERAL WATER IMpoRTS (FULL YEAR, ToNNES)

220190 Italy germany Lbourg Belgium Swland N'lands 2007 3562994 314055 11009 54188 766669 55 2008 6716811 2394818 11178 6597 683226 102 9 2009 3357198 1476389 44298 24142 302701 125 2010 3908756 1031160 48588 32381 2011 1538907 3646668 38102 34167 2012 3759727 1414587 38636 30441 1793 223 212 84 45 27 21 17 65 5245878
Record US exports to Japan

NORWEGIAN imports of mineral water decreased for the fourth consecutive year since 2008, this time dropping by just over 10% in the January-December period of 2012.
Shipments of mineral water from Sweden, the top exporter to the neighbouring northern European country, have been decreasing steadily for the past five years, as other origins muscled their way onto the Norwegian market. Finland, which started exporting to Norway only in 2009, sold almost 1 300 litres last year. Japanese off-take has increased 16%, instead, as imports from the US reached a five-year high. At the same time, imports from Canada and Malaysia have fallen to 550 564 litres and 522 040 litres, respectively. If US exports to Japan have gone up, those to Canada have been sluggish in 2012, dropping from 16.8 million litres (Jan-Dec 2011) to 10.4 million litres last year. Interestingly, Sri Lanka has emerged as the second top exporter to Canada, overtaking more habitual business partners such as Germany, Norway and China. Singapore increased its mineral water off-take by 55%, with more shipments coming in from Malaysia, Australia, Norway, Indonesia and Turkey.
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NL OW21 D Iceland 0 TO 0 0 ICK Lithuania L 0 0 0 C

UK 1000 Spain US Russia others Total
SoURCE: Eurostat
23379 A T D DA 54 A O 393411 457 23 107 52 0 8 16 0 107 5281567 17 0 37 4 0 142
1579 8 0 130 4711687
131 11 0 179 9813062
1140 6 0 161 5206181
5414976
23
Industry News
Norways largest supermarket announces move to PNA tuna

BY FoodNEWS STAFF
UNIL A/S, the purchasing unit responsible for the private label products of Norways largest retailer, NorgesGruppen, is buying Pacifical tuna because it supports the PNA (Parties to the Nauru Agreement), eight small island countries that sustainably manage the skipjack tuna sourced from their waters.
Unil, wholly owned by NorgesGruppen, is responsible for the development, procurement and marketing of products in NorgesGruppens own brands, and has a portfolio of over 2 500 products. The fish will be co-branded in the market as Pacifical, and should be on the market by the summer. The main reason we want to work with Pacifical is the sustainable approach and the fact it is from the PNA, says Einar Mosvoll, senior procurement manager at Unil AS. The PNA, or Parties to the Nauru Agreement, are eight Pacific island nations and home to a fishery that only targets free swimming schools of mature skipjack tuna. The fishery does not use fish aggregating devices (FADS), has minimum by-catch of baby tuna and other species, and is certified sustainable by the Marine Stewardship Council (MSC) eco-label. We do recognise that supporting the PNA countries is important, says Mosvoll. In a public letter issued to tuna boat owners fishing in the waters of the PNA Countries, Unil AS is
calling on tuna fishing companies and processors active in the region to seize the opportunity to start catching and supplying the premium canned tuna sustainably. The statement follows similar efforts by other major European, Australian and African retailers, who are also eagerly waiting for the first shipments of sustainable tuna to arrive. Besides a strong commitment to sustainability, our purchasing policy also aims to buy products which support and contribute to the development and wellbeing of local communities, economies and cultures through fair trade and social accountable practices, said the letter. For this reason we have been closely and enthusiastically following the development of the MSC certification for the skipjack free school fishery in the Western and Central Pacific in the pristine waters of the eight island nations that are united within the PNA. This resulted in the signing of a Memorandum of Understanding with the marketing company of the PNA countries, Pacifical CV, on the supply of this sustainable MSC canned tuna with the Pacifical co-brand.
price for MSC canned tuna caught and processed within the PNA countries, adds the letter. Pacifical tuna will be the second canned MSC-certified product offered by NorgesGruppens private label, after canned mussels. NorgesGruppen represents the largest market share in the Norwegian retail sector, about 40%, and has over 1 700 retail outlets and 600 kiosks. Mosvoll says consumer demand and awareness for sustainable seafood products, including tuna, is still quite low in Norway, but he expects both to increase in the future. Even concerning the countrys dominant salmon fisheries, he says sustainability is more valued by the industry than by consumers. Pacifical canned tuna, bearing the MSC stamp of approval, could be the fish that encourages Norwegian consumers interest in protecting
The main reason we want to work with Pacifical is the sustainable approach and the fact it is from the PNA.
the marine environment. The MSC certification itself is not that important. However, we expect the MSC logo to become more known to the Norwegian consumers in the years to come, says Mosvoll. While cod and salmon are the most popular seafood in Norway, tuna and mackerel in tomato sauce are the most popular canned fish in the retail segment, according to Mosvoll. He estimates the total annual tuna consumption in Norway is about 3 000-4 000 tonnes, compared with 10 00012 000 tonnes for both cod and salmon.
Larger Argentine peach output

PEACH processors in Argentina are expecting to pack more fruit cocktail and produce more pure this year.
Price premium
Unil is willing to gamble that consumers will pay a premium for the ethically-sourced fish. Knowing that sustainable fishing requires a change of practices and procedures, Unil A/S has shown the willingness to motivate and compensate tuna fisherman for these changes by paying a premium
The official crop forecast is some 166 000 tonnes, although canners are predicting production of 176 000 tonnes given how the season is progressing. There is much more fruit than last year, a processor told FOODNEWS. There was some early hail, but it improved during thinning. It is mostly good size and quality fruit. The only problems during the
picking of the extra earlies was that some fruit had over ripened due to unusual extremely hot weather. Estimated production is 5.0-5.3 million cartons (similar to previous years), 650 000-700 000 fruit cocktail cartons (higher than in previous years) and 24 000-25 000 tonnes of pure (highest ever). So far we are 60% of the way through the peach canning programme, no fruit cocktail production so far, he said. Estimated farm gate prices for canning fruit are USD300-320 per tonne and USD160-200/tonne for pure.
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: fneditorial@agra-net.com www.agra-net.com Managing Editor: Neil Murray Deputy Editor: Jennifer Willis-Jones Specialist Reporters: Amy Booth, Louis Harkell, Davide Ghilotti Contributors this issue: Vladimir Pekic, Stuart Todd Market Prices: Matthew Pendered Managing Director: Philip Smith Production Editor: Steve Aylett Advertising Manager: Sunny Patel Tel: +44 (0) 20 7017 4153 Fax +44 (0) 20 7017 7594 Email: sunit.patel@informa.com New Subscriptions: +1 21 2652 5369 (US), +61 (2) 8705 6922 (Asia Pacific), +44 20 701 74308 (Europe and rest of world) General Enquiries: Email: Subscriptions@informa.com Tel: +44 (0)20 7017 5540 or (US) Online Access: Email: OnlineAccess@informa.com Tel: +44 (0)20 7017 4161 Toll Free: +1 800 997 3892
FOODNEWS 2013. All rights reserved. No part of this publication 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. Advertising 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.
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UK drinkers are changing Quote

Name, title, company See page XX

VOL. 41 00 No. 00 FEBRUARY 2013 VOL. No. 7 15 00 MONTH 2011

Brazil likely to major on NFC juice in forthcoming marketing season

BRAZILIAN FcoJ EXpoRTS 2012 (ToNNES)

Key Indicator Snapshot

Brazilian FCOJ -4% this year

Brazilian FCOJ stock -20% claimed

S hemisphere apple crops +1% in 2013

Hidden dragon, crouching tiger no longer

Informa UK Ltd 2013 FoodNEWS 15 February 2013

World Juice Conference will be held in Kln just before ANUGA

The networking and hospitality at World Juice is legendary

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Iran pitted Sayer dates +2.1%

Turkish No.9 sultanas +2.0%

Indian cashew kernel +4.3%

Find more key data in our on-line library at www.agra-net.com

UK sparkling wine consumption likely to exceed previous figures

Beynat and Eizaguirre, chief executive and chairman of Vinexpo

Informa UK Ltd 2013 - FoodNEWS 15 February 2013

Record Californian grape crush accompanied by strong prices

Uruguay success in blueberry exports

Coke distribution deal

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New drink from Kraft

Informa UK Ltd 2013 FoodNEWS 15 February 2013

19-20 March 2013

From the organisers of

Register Online: www.nextgenbiofuels.agraevents.com

Southern hemispheres apple harvests predicted to rise 1%

New Brazilian potato variety

SoUTHERN HEMISpHERE AppLE pRodUcTIoN (000 ToNNES)

ATA AD D LO OWN OD CK T CLI

China eats into Yum Brands

Cuban tomato crop doing well

Informa UK Ltd 2013 FoodNEWS 15 February 2013

Cause for celebration as NFC orange juice sales rise steeply

So Paulo to have smaller orange crop

US RETAIL oRANgE JUIcE SALES (MILLIoN gALLoNS)

Iced tea with cranberry beverage

Chinese and Polish AJC price dips, to worry Chilean sellers

AJc WEEKLY cASH MARKET pRIcES pER USdA (USd/gALLoN)

poLISH AppLE JUIcE BRIX 70, EXW RoTTERdAM (EUR/kg)

ATA AD D LO OWN D K TO CLIC

Beverage sales fall

Fruit drinks taxes investigation

Latest Florida estimate

Informa UK Ltd 2013 FoodNEWS 15 February 2013

Cocofina makes bigger splash worldwide with coconut water

Informa UK Ltd 2013 FoodNEWS 15 February 2013

China ramps up its wine output, as sparkling wine sales rocket

Top 10 WINE coNSUMINg coUNTRIES (VoLUME, MILLIoN 9-LITRE cASES)

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Informa UK Ltd 2013 FoodNEWS 15 February 2013

6th Global Conference

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Tomato crop forecasts cautious as end of market inertia still far-off