COVID-19 Continues to Depress Lime Prices

According to market tracker Tridge, Mexican lime export will continue to face challenges as the COVID-19 crisis continues hampering a revival of food service industries in the US and the EU. Restaurants, bars and other recreational destinations are a major buyer of lime. The market currently faces an oversupply, which saw wholesale prices dropping significantly since March. In addition, it states, importers in other countries are impeded from increasing order volumes due to high shipping costs. Lastly, government shutdowns due to the crisis have complicated and delayed applications for import permits. The consistent drop in wholesale prices is worrisome as the season for lemon and lime harvests in Mexico has just started and ends in September. The exception is Mexican key lime, which can be grown all year around. FreshFruitPortal reports that this year did not see the spikes in lime prices that are normally reported around March and April. In fact, prices in week 18, were 55 percent lower than last year. In the case of lemons, prices have been the lowest in 5 years, with week 18 recording an 11 percent drop compared to last year.

In 2019, Mexico was the world’s second largest lemon and lime exporter with a total value of US$523.1 million, equivalent to about 15.6 percent of the global market. Tridge reports, that the total production volume is expected to climb to 2.4 million metric tons this year, as planting acres have increased to 205k ha. The most abundant fruit in Mexican production is the Persian Lime with 49 percent of total lime exports, followed by (Mexican) Key Limes, at 44 percent. In the lemon compartment, Mexico exports both Italian and Mexican lemons. The primary states of production are Veracruz, Michoacan and Oaxaca.The Key lime has increased in popularity over the years, as it is considered to be sweeter and less acidic.

According to Investopedia, the biggest exporter of lemons/limes in 2019 was Spain, with 24.7 percent of total exports. Murcía is the absolute capital of citrus exports. This is followed by Mexico, with the afore mentioned figures, and the Netherlands, which exports 10.1 percent of the global demand. The latter is not a producer, and merely imports and exports to other countries in Europe as the principal hub for the continent. Mexico saw an increase in surplus of export compared with import, up 42.9 percent since 2015. Other countries have seen larger increases in export, but are coming from a much smaller initial production volume. The EU, the second biggest destination for Mexican limes, saw an increase in 33 percent in import of limes between 2014 and 2017. However, according to CBI, rapid increase in the popularity of the product has provided opportunities to other countries to develop their lime production. Increasing global production has the potential to drive prices down. China has rapidly increased it lime production over the years, but continues to supply primarily to South Asian markets. CBI has identified the organic lime as a growing market niche as the skin of the lime is often used in food and drink preparations.