According to the Rosselkhoznadzor, China again received the right to supply fresh apples and pears to the Russian market from February 20, 2022.

This is good news for China and for Russian consumers, who are now paying a very high price for Russia’s voluntary self-isolation from global markets. However, according to EastFruit analysts, this is bad news for Moldova, which has a major competitor in the Russian market.

“China is the world’s largest exporter of apples and has remained at the top of the global ranking of exporters, despite the ban on the supply of products to the Russian market. China exports about 1 million tonnes of fresh apples to many countries around the world annually. The main advantage of Chinese apples is their low price. Therefore, they are mainly purchased for a low price segment, while China imports premium-quality apples from countries such as New Zealand, the USA, Chile, South Africa and France,” says Andriy Yarmak, economist at the Investment Centre of the Food and Agriculture Organization of the United Nations (FAO).

Note that before the ban on supplies, Russia was one of the three main markets for fresh apples. Annual exports of Chinese apples to the Russian market ranged from 100 000 to 150 000 tonnes, which made China the second largest supplier of apples to Russia after Moldova. In some years, the volume of supplies of Chinese apples to the Russian market even exceeded the volumes of supplies from Moldova.

At the same time, Russia is the world’s largest importer of apples, purchasing from foreign markets from 700 000 tonnes to 1 million tonnes of fresh apples annually. In connection with the build-up of Russia’s aggression against Ukraine and the expected tightening of international sanctions against the Russian Federation, there is a real threat to Russia’s food security. Prices for vegetables and fruits in the Russian Federation can rise quite sharply, which will make them unaffordable for many local consumers, as the country is heavily dependent on their imports. Therefore, the refusal to ban the import of fruits and vegetables is a logical step.

Recall that the import of apples and pears from China to Russia was stopped on August 10, 2019 due to the increased number of cases of deliveries to the country of products not complying with the Russia food safety regulation. Since then, Chinese products only in small volumes have been re-exported to the Russian market through third countries.

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According to EastFruit analysts, China has been the largest global exporter of fresh apples for two years in a row, supplying more than 1 million tonnes to foreign markets. Apple exports from China in 2021 increased by 2% and reached 1.08 million tonnes.

However, China’s apple export volumes are far from the record levels of 2016-2017. At that time, China steadily exported more than 1.3 million tonnes of apples annually, and a record volume of 1.35 million tonnes was exported from China in 2016. This was followed by a decline in exports due to growing competition in global markets and growing domestic demand for apples in China itself.

In 2021 Vietnam became the largest apple importer from China for the first time. China exported more than 180 000 tonnes of fresh apples to Vietnam, 13% more than in 2020. Last year, EastFruit analysts already drew attention to the fact that Vietnam literally burst into the ranks of global leaders in the import of fresh apples. Vietnam should become one of the priorities for Ukraine in the apple export segment, but first it is necessary for the government to agree on access to this market.

You can see how China rose to the top of the global ranking of apple exporters, and who overtook it in our video “Race for the global leadership in exports. Rating of the largest apple exporting countries in the world.”

The second priority market for Chinese apples was Bangladesh, where only a little less apples were exported than to Vietnam. The two countries accounted for one third of all apple exports from China.

China exported more than 100 000 tonnes of apples to three more countries: the Philippines, Indonesia and Thailand. Exports of Chinese apples to Indonesia grew the most – by 19%. It is also necessary to note other sales markets that were the fastest growing apple imports from China: Nepal increased imports over the year by an impressive 80% and brought it to almost 79 000 tonnes, Malaysia – by 12% and Mongolia – by 28%.

Among the countries that bought relatively small volumes, apple exports from China to Guinea and the Maldives increased very sharply. Noteworthy, China even exported 74 tonnes of apples to Italy, which is one of China’s main competitors in the global apple market!

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EastFruit analysts report that according to preliminary estimates, the exports of walnuts from China increased by 60% in value terms in 2021, despite record low walnut prices in the first half of the year. Notably, several post-Soviet states are among the main importers.

China has set new records for the exports of inshell walnuts and walnut kernels in 2021. According to our estimates, the exports of kernels has doubled over the year to 45-47 thousand tonnes, and the exports of inshell walnuts has increased by 50% to 110-115 thousand tonnes.

In total, China earned about $420 million from the exports of walnuts in 2021, which was also a new record. Thus, China may rank third among walnut exporters in 2021, bypassing Chile and increasing the gap with Ukraine, which still remains the fifth. Ukraine continued to experience difficulties with walnut exports due to low global prices and changes in the regime of access to the Turkish market (read more about the results of the Ukrainian walnut season here).

It should be noted that there are three post-Soviet countries among the six largest buyers of Chinese walnuts: Kazakhstan, Kyrgyzstan and Russia. At the same time, the exports of walnuts from China to Russia in 2021 increased by more than 50%.

Unexpectedly, the UAE became the main buyer of walnuts in 2021, having increased imports by 250%. Kazakhstan and Kyrgyzstan are the second and third, respectively.

Turkey, which sharply reduced the imports of walnuts from Ukraine, seems to have replaced Ukrainian walnuts with Chinese ones. The exports of walnuts from China to Turkey increased around 120% by the end of 2021, and Turkey ranked fourth among the most important walnut markets for China.

We also note three more fastest growing markets for Chinese nuts: Iraq, Vietnam and Saudi Arabia. These countries have more than doubled their imports of Chinese walnuts in a year.

You can find the largest suppliers and buyers of walnuts from Ukraine, Moldova, Russia, Uzbekistan, Georgia and other countries of the region on our trading platform in Telegram EF Trade Platform.

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EastFruit analysts point out the rapid growth in the popularity of durian among Russian consumers. Imports of fresh durian to Russia grew 2.5 times in the first 10 months of 2021. Wealthy consumers in Russia are ready to pay a lot of money for this exotic fruits, so premium supermarket chains consider it an increasingly important position.

Where does durian grow, how popular is it, and which countries supply durian to the Russian market?

First of all, we note that the global volume of international trade in fresh durian in 2020 approached $3 billion. This is quite a lot, because durian is a rather expensive fruit. For comparison, the global trade in apples fluctuates between $7-8 billion per year.

75% of the global trade in durian is controlled by one country – Thailand. Apparently, it is in Thailand where the majority of Russian consumers with middle and high incomes tried it. Indeed, before the start of the coronavirus pandemic, Thailand was a favorite vacation spot for many Russians.

However, Russia imports durian mainly from Vietnam – the second largest exporter of durian. In general, only three countries of the world export large volumes of durian: Thailand, Vietnam and Malaysia. The rest of the countries mainly re-export it.

A limited number of fresh durian exporters is caused by the difficulty in transporting it. Almost none of the world’s leading transport companies agree to transport these strange, but so demanded fruits. You can understand the reasons for such decision by learning more about durian.

What is durian and why do consumers like it?

In Asian countries, where durian grows, this fruit is described briefly: “Hell outside, Heaven inside.” The durian fruit weighs from 1 to 3 kg and looks very aggressive as it is surrounded by sharp thorns. However, this is not the worst thing – what actually scares people away from durian is the disgusting smell. What is the smell of durian like? If you can imagine how a clogged sewer system, rotten fish and onions smell at the same time in the heat, then this will be as close to the truth as possible.

If you overcome these two barriers: thorns and a bad smell, and try the pulp of durian, you will see that its taste is as wonderful as its smell and appearance are terrible. It is not easy to describe the taste of durian, and everyone feels it differently. Consumers often say that the taste of durian resembles eating many fruits at once, such as papaya, pineapple, strawberry, mango, persimmon, vanilla, seasoned with cream!

Therefore, even in Russia there are those who believe that durian is the most delicious fruit in the world. But who is really crazy about durian is the Chinese – they spend more than $2 billion a year on imports of durian! Just as Thailand controls 75% of global exports, China controls 75% of global imports of durian.

Russia is still far from China, but it may become one of the 30 largest importers of durian in the world in 2021 for the first time. However, this indicates a great potential for durian supplies to the Russian market in the longer term, provided that there will be no further significant decrease in the income level of the population.

Besides the high prices, disgusting smell, unfriendly appearance and great taste, durian is also considered to be one of the most healthy fruits. Many people consider durian a superfood due to its high content of vitamins and minerals. Durian fruits contain a lot of magnesium, zinc, calcium, fiber, vitamins of groups A, B, C. What is very important for women, it contains a lot of folic acid. Durian has also been shown to have strong bactericidal properties.

What makes durian especially popular among tourists in Thailand is that the locals consider it to be a strong aphrodisiac. In addition, durian is believed to increase the chances of pregnancy in a couple who consume durian due to its indole and estrogen content. However, there is no scientific evidence for this property of durian, and this can only be a marketing trick, but it works great.

In countries where durian grows, it is forbidden to bring it to hotels and to transport it on airplanes, even in super-tight and sealed packaging. Also, it should not be consumed by nursing women, pregnant women and people with high blood pressure.

Note also that, despite its formidable shell, durian fruits are quite tender and are easily damaged during long-term transportation. And this also limits their exports. Durian is usually delivered to consumers by air.

How is durian grown?

Durian grows on very tall trees. The height of the durian tree can reach 40-50 meters. Therefore, harvesting durian is a difficult and dangerous job.

Industrial varieties of durian trees give their first harvest in the fourth or fifth year after planting, although most durian trees in nature begin to bear fruit only 15 years after germination from seeds. Despite there being many varieties of durian in the wild, only a few of them are considered edible and are cultivated by farmers in tropical countries.

At the same time, most varieties of durian can bear fruit twice a year. Interestingly, the flowers on durian trees open in the evening. Moreover, their smell is not as unpleasant as the smell of ripe fruits. However, durian is not pollinated by insects, but by animals – the smell of durian flowers attracts bats – the main pollinator of these unusual fruits.

Durian can only be successfully grown in tropical climates. Considering the difficulties of transportation, it is best to consume durian in the places where it grows in order to truly appreciate its unique taste, and, of course, its terrible smell.

By the way, the annual world durian festival is held at the beginning of May in Thailand, in the province of Chanthaburi. Can you imagine the smell there?

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According to EastFruit analysts, in 2021 Uzbekistan once again reduced fruit exports to China – one of the most attractive fruit markets in the world. In the first eight months of 2021, fruit exports in volume fell by 16% compared to the same period in 2020 and three times compared to 2019. Thus, the negative trend in the supply of fruit to the Chinese market continues.

The decline in exports of Uzbek cherries was especially noticeable, despite the very low price level. In 2021, Uzbekistan managed to find and deliver to China only 14 tons of cherries that met the requirements of demanding Chinese importers. Uzbekistan exported 105 tons of cherries in 2020, in 2019 – just over 600 tons, and in 2018 – 148 tons, that is, since gaining access to the Chinese cherry market, Uzbekistan has never exported so little cherries to China.

It is China that is the fastest growing market for cherries in the world. The exports of cherries is growing fast, and their prices remain very high. Moreover, it is China that pays one of the highest prices for cherries. However, Uzbekistan was forced to supply cherries in 2021 mainly to Russia and much cheaper than in 2020, since their quality did not meet the requirements of buyers from other countries. Uzbekistan had more and more competitors in the Russian market who offered a better product. We gave a detailed analysis of the reasons for low prices for cherries in Uzbekistan in this article.

You can see and read how cherries of export grade quality are grown, refined and packaged in Uzbekistan here. You can read and listen in detail how much it will cost to set up such a farm and how to do it right.

Let’s get back to the fruit trade between Uzbekistan and China. An anti-record has also been set over the past seven years even for the most popular position, namely the exports of Uzbek raisins (dried grapes) to China! It fell by 17% compared to 2020 and three times compared to 2019, when the export volume was at its maximum. The only export position where Uzbek exports to China increased was dried apricot. The export of dried apricot grew by 37% compared to 2020, but its share in export was small – only about 5%, so it did not impact the overall negative dynamics largely.

“The global markets for both fresh and dried fruit are becoming more competitive as production in developing countries grows. This is facilitated by a freer access to information about cultivation and processing technologies, which allows faster implementation of these methods in production. The FAO and EBRD also strive to foster the transfer of technology and market knowledge, in particular through the EastFruit platform. However, since there is no shortage of fruit in the world, for success in the market it is essential to ensure high quality and safety of the grown fruits in the sense buyers, and not producers themselves, perceives it. Too little attention is paid to fruit quality, refinement and marketing in the post-Soviet countries, which leads to the need to sell or send products for processing at the lowest prices,” explains Andriy Yarmak, economist at the Investment Centre of the Food and Agriculture Organization of the United Nations (FAO).

By the way, while Uzbekistan was reducing the export of fruits to China, Iran was actively increasing it. In the first 8 months of 2021, the export of Iranian fruits and nuts to China increased by 75%!

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According to EastFruit analysts, Singapore sharply reduced the volume of apple imports in 2021, despite their lower price. Ukraine is not among the suppliers of fresh apples to Singapore for the first time in recent years.

In the first three quarters of 2021, this Asian country imported 27.2 thousand tons of fresh apples – 17% or 5.4 thousand tons less than in the same period in 2020. Imports reduced from all five largest supplying countries: China, New Zealand, South Africa, the United States and France.

Notable is that China which had surplus stocks of apples and offered them at a record low price during the first nine months of 2021 also reduced their exports to Singapore. We published a detailed analysis of the Chinese apple market in 2021 in the article: “Apple market in China: high stocks, low prices, pessimistic expectations“.

In this context, the sharp increase in apple imports to Singapore from Turkey and Italy attracts attention. Turkey managed to increase its apple exports to Singapore by 62%, and Italy by 73%. By the way, we have been paying attention to the Turkish apple phenomenon for quite some time. The situation is different in Italy – producers clearly overestimated the demand for apples in the 2020/21 season and entered the summer season with record apple stocks, which they failed to sell before the start of the new harvest. Therefore, apples of the 2020 harvest are still being sold on the Italian market. Thus, Italian wholesale prices were low, and they actively offered their apples in the markets of Southeast Asia at a competitive price.

We remind you that the new season for apple growers and exporters in Eastern Europe may become much more difficult than the previous ones. We have provided a detailed analysis of the reasons in the article “#Freshapplecrisis“.

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According to EastFruit analysts, participants in the Chinese fresh apple market expect a difficult season. Despite the USDA’s forecasts of a possible decrease in the apple harvest in China, local sources speak of a likely increase in production.

The situation is aggravated by the fact that summer apples in China in 2021 were sold at record low prices given large stocks of the 2020 apple harvest in the country’s fruit storage facilities. Accordingly, apples from storage were sold at relatively low prices, competing with summer varieties.

Since Chinese farmers started supplying Gala apples to the markets in late July and early August, the situation in August only worsened and prices remained at record lows. Farmers often received less than $0.2 per kg for good-quality summer apples, and buyers paid no more than $0.10 per kg for small-sized apples!

Despite low prices throughout the season, China managed to increase its apple exports by only 2% compared to the 2019/29 season to 1.1 million tons. This was the highest export volume in the last three seasons, but it was significantly lower than the export in the 2016/17 and 2017/18 seasons. In those years, China exported 22-24% and almost 260 thousand tons more apples than in the 2020/21 season.

Read also: Apple prices in Belarus are among the highest in the region due to government regulation

Apple imports to China last season were also at a record low for many years – only about 69 thousand tons. However, this did not save the situation. It seems that an alternative to the Russian market, access to which for Chinese apple exporters is still closed, has not been found.

This is complicated by the unfavorable situation in the apple concentrate market, where China is the largest producer and supplier. In recent years, reconstituted juices are no longer considered a healthy product and are losing consumers around the world, with other drinks taking their place. Accordingly, even the sale of apples for processing into concentrate at an affordable price is now more complicated.

Another high apple harvest in 2021 in China, if confirmed, could aggravate the global imbalance in apple supply and demand, which EastFruit experts draw attention to with the #freshapplecrisis hashtag.

By the way, from the countries of our region, Uzbekistan became the largest apple importer from China last season, where about 6 thousand tons of Chinese apples were shipped. Kyrgyzstan bought about 2.8 thousand tons of Chinese apples, while other countries almost did not import apples from China. On the other hand, China actively competed in the markets of Asia and the Middle East with apple suppliers from Europe, and this competition in 2021 can only get tougher, because a record apple harvest is expected in Eastern Europe.

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According to EastFruit analysts, Hong Kong, which was previously among the world leaders in terms of fresh apple imports, is likely to drop out of the world’s top ten importers for the first time in the 2020/21 season. This is due to the continuing decline in re-exports of fresh apples to China for four seasons in a row and competition from other fruits in the market.

This information is important for Ukrainian apple exporters, who viewed Hong Kong as an important market for premium quality apples in anticipation of a difficult season, when record production volumes are expected in several countries of the region.

According to the results of the 2020/21 season, Hong Kong imported 162 thousand tons of apples – the lowest volume in the last five seasons, and the main suppliers of apples to Hong Kong were China, New Zealand, USA, South Africa, Japan, Chile and France. By the way, Ukraine has not been supplying apples to Hong Kong for two seasons in a row, but Serbia last season, on the contrary, exported to Hong Kong the largest volume of fresh apples in history – 171 tons. Interestingly, Poland also did not supply a single kilogram of apples to the Hong Kong market during the season.

Apple re-exports to China from Hong Kong fell to 36 thousand tons in the 2020/21 season, although in the 2018/19 season it reached 61 thousand tons, and last season – 44 thousand tons. Accordingly, the volume of domestic apple consumption in Hong Kong continued to grow, but the oversaturation of the domestic market in mainland China had a key impact on the decline in imports. The fact is that last season China itself increased its exports and reduced the volume of imports of fresh apples to a minimum.

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Uzbekistan made pomegranate its strategic priority, which EastFruit analysed in detail here.  It also very important that besides supporting production, Uzbekistan is also thinking of opening new markets for fruits. According to ProduceReport,  on April 27, China’s General Administration of Customs announced that pomegranates from Uzbekistan meeting the stipulated phytosanitary requirements would be permissible for export to China.

According to EastFruit, Uzbekistan exports only 10 to 15 thousand tons of fresh pomegranates per year and most of it goes to Russia and other countries of ex-USSR. On the other hand, China is the largest global importer and imports, together with Hong Kong, pomegranates for a little more than $1 billion.

EastFruit analysts compare the trends in pomegranate trade to these of global fruit bestseller avocado – the global trade of these fruits is indeed growing very fast. “It is a very rewarding to see Uzbekistan focusing on trendy products. Global pomegranate market is growing fast and having China – largest global buyer, as a neighbour, suggests that Uzbekistan is making a good move. However, Uzbekistan would have to develop a large-scale commercial production, storage and handling of newer varieties to match expectations of Chinese buyers, which will certainly take some time and will pose some technological challenges” says Andriy Yarmak, economist of Investment Centre of the Food and Agriculture Organization of the UN (FAO).

It should be noted that the pomegranate supply season in Uzbekistan typically lasts from September to November, which partially overlaps with that in China (July–November). Furthermore, pomegranate production in Uzbekistan is focused on local varieties, which may be less appealing to Chinese consumers.

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EastFruit analysts draw attention to an interesting trend in the Russian vegetable market – while prices for potatoes grown in Russia are record low in the recent seasons and Russia even became a large exporter of these tubers, Russian consumers are taking keen interest in alternative products – yams and sweet potatoes. As a result, imports of sweet potatoes and yams to Russia are growing much faster than imports of other categories of vegetables.

In 2020 along, when consumers’ incomes in the Russian Federation decreased, the imports of these expensive tubers more than doubled. The imports of sweet potatoes reached 2.3 thousand tons, an increase by 120%, and the import of yams amounted to 55 tons, an increase of 130% compared to 2019. Over the past five years, the imports of sweet potatoes to Russia has increased 12-fold, and the imports of yams – eight-fold.

These niche tubers in Russia are gaining more and more popularity, despite the fact that they are exotic products for local consumers. Gastro bloggers and fitness bloggers are the key drivers for increasing consumption. They actively share information on healthy diets and new dishes with exotic types of products on social networks.

You can buy sweet potatoes in the capital of Russia today at retail prices ranging from 380 to 500 rubles per kg ($ 5.0-6.5 US dollars per kg). Yams is sold for one tuber, not per kg, because, in most cases, a yam tuber is more than 1 kg in size and weighs, on average, one and a half to two kg. If we recalculate the price of yams into kilograms, we get about 600-700 rubles / kg or $ 7.9-9.0 US dollars per kg.

Sweet potato is pleasing consumers with a variety of colors of tubers and tastes, which makes it possible to use it in a wide variety of dishes. From the point of view of its value for a healthy diets, sweet potatoes are superior to potatoes, because they contain a lot of fiber, iron, calcium, starch, glucose, minerals and vitamins. Yellow, red and orange varieties of sweet potatoes have a high content of carotene.

Interestingly, sweet potatoes can be grown in Russia as well, while most yams types can only be grown in the tropics and sub-tropics. The first producers of sweet potatoes have already begun to appear in Russia, but the pioneer of sweet potato breeding in the region is Ukraine, where there are already many producers this tuber. Ukraine even exports small amounts of sweet potatoes to the EU countries. There are sweet potato producers both in Georgia and Moldova. In Ukraine, they even come to the need to create sweet potato processing.

The demand for sweet potatoes is growing not only in Russia, but all over the world, which stimulates production – after all, prices for sweet potatoes remain attractive. China is the leader in the production and export of sweet potatoes in the world.

Yams are generally grown in the tropics and subtropics, with the main producers and consumers in sub-Saharan Africa. Yams are rich in vitamin C, potassium, vitamin B6, manganese, starch and fiber. Yam is also low in fat but high in polyunsaturated fatty acids and sodium, which makes it good for the heart. In general, yam has been actively gaining popularity outside Africa in recent years, and the trends in its import into the Russian Federation are another confirmation of this.

The main supplier of sweet potatoes to Russia is Egypt, which accounts for exactly half of all Russian imports. Honduras and Israel also supply large volumes of sweet potatoes to the Russian Federation. Slightly less sweet potatoes are imported from Guatemala, China and Vietnam.

Fresh yam is supplied to Russia mainly by the countries of Sub-Saharan Africa – Ghana and Nigeria. A small batch of these tubers entered the Russian market in 2020 also from China.

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