Domestic market increases orange juice demand
Valor Econômico 07/29/10
Orange juice consumption in the domestic market is growing. While in 2005 only 3% of the national production of juice was consumed by Brazilians, such figure is near 10% today. Even with the exported volume relatively stable over the past five years, the domestic demand for concentrated juice has increased significantly. Data of the United States Department of Agriculture (USDA) indicate the Brazilian exports of concentrated juice went from 1.34 million tons in 2004/05 to 1.32 million tons estimated by the entity in its July report for the 2009/10 harvest . The 1.5% fall in the foreign sales faces growth above 50% in the domestic demand. The consumption of concentrated juice in Brazil went from 23 thousand tons in 2005 to the current 35 thousand tons.Despite the relative growth being high, the volume of orange juice consumed in Brazil is still low compared to other countries. Russia, for example, drinks 45 thousand tons a year, while the Chinese have a domestic demand of 59 thousand tons. Nevertheless, the expectation of the consulting firms and private companies is that the consumption of concentrated juice as well as that of ready-to-drink juices increases in the country due to the increase of the income of the population. The processing industries estimate the consumption of orange juice in Brazil will triple within five years. "People are more and more sophisticated. The increase of the income has caused the population to increase the quality of the product consumed, and the trend is that there is a growth in the demand for ready to drink juices, including orange juice", says Maurício Mendes, Director of AgraFNP.
For the analyst, such increase in the domestic demand for Orange will change the current relationship between producers and industries in the coming years. He recalls that the internal market, so far, used to take what was not exported. "We are living a moment in which the domestic market is no longer something marginal and Brazil becomes the main customer of Brazil for orange juice", says Sampaio. The domestic demand of orange juice tends to be even greater if it is included in the Orange consumed in kind. Nearly 30% of the production of 16.23 million tons of the 2009/10 harvest is fruit in kind, which can be used for the production of juice at home, for example. Such percentage has remained relatively stable in recent years. In 2005, it was 27% - 73% were intended for the processing industry.
Estimates of Tetra Pak indicate the consumption of ready to drink juice in Brazil will become five times greater over the next five to six years. Last year, the consumption in the country got to 470 million liters and it is expected to reach 2.5 billion liters by mid-2015, according to the Swedish manufacturer of packaging. "In Brazil, the consumption of orange juice from the fruit [in kind] is still very big, but the industries have advanced a lot in the technological area and they managed to increase the quality for the flavor in recent years", says Eduardo Eisler, Vice President of business strategies of Tetra Pak for Mercosur and Latin America.