Professional Documents
Culture Documents
Worldwide one of the most demanded, studied and consumed fruit has been the citrus
concurrently its production has been increasing considerably for the few years .Citrus is
the leading fruit of Pakistan in terms of area, production and export, contributing to
around 50% of the total fruit production and about 25% of the country’s fruit export.
has yet to achieve a significant place in the export of citrus fruit. Worldwide affluent
mass market of citrus fruit and its production in few countries clearly signify very high
potential for Pakistan in export markets, thereby boosting foreign exchange earnings.
MARKETING CHAIN
MARKETING SYSTEM
Like other fruits, citrus fruit trade is with the private sector. However, Government
measures for smooth business operations. The flow chart of citrus fruit for export and
The harvested Kinnow is generally exported through different channels. First, exporters
purchase Kinnow from the beoparies (middleman), process and then they export it.
Secondly, exporters directly purchase the commodity from the farmers, process and then
it is exported. Thirdly, exporters have their own orchards, process the produce and then
they export to different countries. The produce is brought to Kinnow processing factories
generally in 20 and 40 kg plastic buckets on Mazda vans (small trucks). After unloading,
the produce is washed, dried, waxed, again dried, graded, packed and labeled in the
processing plant. After packing (cardboard and wooden boxes), fruit is transported to
However, open-top trucks are also used for transporting the fruit to Karachi Port. The
problems associated with Kinnow export include low produce quality, lack of storage
charges, weak role of export promoting agencies and inconsistent government policies.
Perishable commodities require proper packing otherwise it may lose its value in the
market. Benefits of quality packing includes intact freshness of produce with less
damage, longer shelf life and better appearance. Both the cardboard and wooden boxes
were used for export. Kinnow exported to Middle East especially Dubai and KSA in the
wooden and cardboard boxes. However, Kinnow exported to Russian States, Far East and
In the international citrus marketing chain harvested fruit may go to the fresh fruit
juice, or it may enter the processing industry, in order to obtain orange juice (mainly in
the form of Frozen Concentrated Orange Juice, FCOJ, for ease of transport in
international trade) and other by-products. There is increasing competition in this sector,
International trade in the fresh citrus fruits sector is characterized by the reduced
this sector, which favor the obtention of better prices and conditions, improve negotiating
companies that operate in Brazil and Florida dominate the market. These companies are
highly vertically integrated, since size and scale are an important competitive advantage,
particularly in bulk transportation of the juice. During the recent past, the international
orange juice marketing chain has been marked by different developments, such as the
penetration of global beverages brands (e.g. Coca-Cola with Minute Maid and Pepsi-Cola
with Tropicana) and the concentration in FCOJ supply.
A simplified representation of the citrus fruit marketing chain, identifying the major
agents in the chain (although, given the vertical integration existing in the orange juice
sector, a company may be present at different stages), is shown in the following chart:
There are two kinds of orange juice processors: bulk processors, who produce most of
the world’s orange juice, and marketing processors, who sell the packaged juice under
their own brand name and often purchase additional juice from bulk processors. The
beverage industry buys the FCOJ in order to add the water and transform, bottle and
market it. These bottlers have undergone a process of mergers and acquisitions, where
juice companies are becoming part of major multinational beverage companies. This is
leading increasing concentration in the sector.
Global retail chains are playing an increasing role in the distribution of produce in
as their global expansion, has improved their position and augmented their buying power
in the market. It allows them to influence the marketing chain in order to better control it,
some citrus fruits growers and citrus processing companies are reacting, shifting from
their production orientation to a more market oriented approach, improving supply chain
Export marketing practices of almost all products are usually quite different from that
of domestic marketing. On account of their comparatively sensitive nature and short life
cycle, perishable commodities in general and citrus fruit in particular, demand special
care, when traded internationally. Export marketing practices of citrus fruit in Pakistan is
Citrus fruit in general and mandarins, Clementine & oranges in particular are among
the most favored tree fruit crops in the world. The world market for citrus is expanding.
The exporting countries are striving to further expand their market share as new markets
open up with world trade liberalization. The soil and climatic conditions in Pakistan have
given ‘Kinnow’ a unique flavour which distinguishes it from other comparable cultivars
(Mandarins) grown in the World. Though fluctuating from year to year, export of kinnow
The quality and quantity of export of citrus fruit, largely depends on method of
cultivation and production. It is important to note that export of citrus fruit represents on
average 4% of the total citrus production of the country, whilst post harvest losses of
citrus fruit contribute above 40% each year. This shows that if only 10% losses
may, somehow be avoided, Pakistan can double its exports without any increase in
production level.
From 1999-00to 2003-04, production of citrus has declined on an average by 4.5% but
export of citrus had not been affected considerably. Although proportion of export of
citrus fruit in export of all fruits and total citrus production has been increased
considerably during last decade, about 110 and 190 percents respectively, it has still to
achieve a notable position. The insignificant proportion of export of citrus fruit has been
mainly because export markets and opportunities have not been properly exploited.
In spite of brisk increase in consumption of citrus fruit and juices throughout the world
export market and opportunities in Pakistan have been confined to a few countries.
The growing trend of export of citrus justifies high potential and opportunity in the
international markets. The need of the hour is that fruits in general and citrus in particular
exchange through export. No special consideration has been given to produce and market
The distinct taste, size and other quality characteristics of citrus, especially kinnow
mandarin produced in Pakistan appeal to mass market worldwide. The main target
markets of Pakistan have been Middle East and Far East countries. Pakistan has been
focusing on these regions for decades but ignoring many other opportunities. ″About half
of kinnow exports are destined to South Asian markets – Indonesia, Sri Lanka,
the Philippines, Singapore, Malaysia and Hong Kong. Of the remaining half, Dubai is the
leading market followed by Afghanistan, Saudi Arabia and Europe. Though a large
proportion of export of fruits, including citrus, goes to Middle East, still huge
Saudi Arabia alone imports around 400,000 tons of fresh fruits each year.
export. Indonesia is the single largest market for kinnow. Annual exports of kinnow to
Export of kinnow alone contributes about 97 percent in total export of citrus fruit from
the country. Information on country-wise citrus fruit exports is contained in Annex 1. The
kinnow exports are mainly directed to Indonesia, Dubai, Philippines, Afghanistan and
Considering the fact that citrus fruit, especially kinnow mandarin, produced in Pakistan
has high potential in the international markets, exploring new markets deserve immediate
Fifteen countries contribute more than 81% of total citrus production globally indicating
purchasing power parity, 5 countries which include Pakistan, China, India, Israel and
Turkey are major citrus producers. In addition this segment also represents more than
55% of world’s population. Considering the fact that China and India are the two most
populous countries, representing around 37% of the total population of the world, most of
their citrus is consumed in their domestic markets. Turkey and Israel though other major
players of citrus fruit in this region are mainly known as key producers and exporters of
including Pakistan, the other 13 countries which represent a market of around 849 million
people, most of then having strong purchasing power parity are not main producers of
citrus fruit. This shows a great opportunity for Pakistan citrus exporters to capture this
the only major orange producer and exporter in the Europe. This zone represents a mass
market of about 232 million people, most of them having very strong purchasing power
parity.
Analysis reveals that Brazil and Spain are the main exporters of citrus fruit and juices
(FCOJ) respectively in the European countries whilst Pakistan has been mainly targeting
the Middle East and Far East countries. More than 85% citrus mainly kinnow mandarin
goes to five countries of this region, ignoring the huge market of Europe.
In summary it can be said that Pakistan is though the largest kinnow producing country of
the world and quality characteristics of Pakistani kinnow mandarin are better than many
of the competitors, it does not gain significant share and name in the international market
For Pakistan, Eastern European countries may emerge as potential markets. In some
countries including Russian Federation & Ukraine It has already made entry.
Pakistan with its distinct quality kinnow mandarin and advantage of proximity can avail
Pakistan is reported to have exported 122,760 tonnes of kinnow worth about $32.727
million in the financial year 2006-07. It had also accomplished the export target of
110,000 tonnes for the year 2007-08. During this period total yield of kinnow stood at
This year (2008-09), kinnow exporters have set a target of exporting 225,000 tonnes
and the main markets were Russian Federation, Iran and UAE. Pakistan had already
faced a hard task in the cropping season this year due to bad crop, inclement weather and
pesticides attack which destroyed the bulk of crop. A steep decline is anticipated and
kinnow production is to stay around 1.6 to 1.8 million tonnes. The exporters may not be
able to meet the export target but however under the free trade agreement (FTA), if
Pakistan is able to meet Chinese quality standard by the kinnow exporters, it would be
COMPETITION
Pakistani exporters are experiencing competition from China. China starts exporting
easy peelers to the Far East markets in October, earlier than Pakistan, and the Chinese
season ends early March. Quality of Chinese citrus has been improving rapidly and
Emerging Markets