2. Trade and Marketing in the Citrus Sector of Trinidad and Tobago
The analyses of the international citrus marketing chain mainly focus on oranges and orange juice,
given the outstanding weight of these products in the citrus fruits group. Harvested orange fruits may go to
the fresh fruit market, in order to be consumed fresh, or squeezed freshly at home to be consumed as juice,
or they may enter the processing industry, in order to obtain orange juice and other by-products.
Competition is increasing in the sector, with restructuring and changes in the marketing chain, in a context
of globalization. The market is increasingly consumer driven.
International trade in the fresh citrus fruits sector is characterized by a relatively lower degree of
concentration of supply, with a multitude of small or medium-sized firms providing the fruit, although
there is a certain trend towards concentration of producer groups as a response to buyers consolidation.
There is also an important presence of cooperatives in this sector, which favor better price and marketing
conditions for growers by improving their negotiating power and coordination.
World citrus trade has been boosted by the strong growth in production and consumption since the
mid-‘80s. Production of oranges, tangerines, and lemons and limes have all expanded rapidly. Even faster
growth has been realized for processed citrus products as improvements in transportation and packaging
have lowered costs and improved quality. In 2001, Brazil was the largest producer in Latin America but
the third largest exporter, while Argentina was the third largest producer but the second largest exporter.
The major citrus exporting countries in the region were Cuba, Dominican Republic and Jamaica, while
T&T is just a negligible exporter of fresh citrus to neighboring islands, while it is a net importer of
concentrated juice.
Orange juice trade is much more concentrated than trade in fresh fruits. The most representative
stages of orange juice marketing chains at the international level are that of Brazil, as the major supplier of
orange juice to the world, and Europe, as the major market for orange juice exports. A small number of
companies that operate in Brazil and Florida dominate the market. Four major companies in the sector,
Brazilian companies Citrosuco and Cutrade, plus multinationals Cargill and Luis Dreyfous, hold around
70/75% of the market share in Brazil and 30/35% of the market share in Florida. These companies are
highly vertically integrated, since size and scale are important competitive advantages, particularly in bulk
transportation of the juice. Along with concentration and integration, the penetration of global beverages
brands (e.g. Coca-Cola with Minute Maid and Pepsi-Cola with Tropicana) are among the major recent
developments in the international orange juice marketing chain.
Trinidad and Tobago’s production and marketing system for oranges comprises of the 1,000 plus
producers, several middlemen and the end users, comprising of consumers, supermarkets, hotels and
restaurants, processors, the School Nutrition Programme (SNP) and the external market. The typical
marketing transaction for fresh produce is characterized by many shippers selling to many middlemen - at
the farm- gate or in terminal wholesale markets - or directly to consumers, using roadside stalls at the
farm-gate or along busy roadways, or through sales in the retail market. In the sales to middlemen,
generally farmers are responsible for harvesting the produce.
Middlemen purchase the produce from farmers and supply the end users (except for the processing
plants which are supplied directly by farmers). Few middlemen are specialized in citrus fruits; while most
are generally involved in the trade for fresh fruits and will include citrus during peak harvest periods. The
operations of the middlemen may be relatively simple, involving purchasing from farmers and then
retailing in markets or roadside stalls, or may be more complex, involving packing house operations of
cleaning and sorting to fulfill contracts with supermarkets, hotels and restaurants, and the export market.
In Caribbean countries, and particularly in Trinidad and Tobago, the fresh fruit market is the primary
sales outlet for most farms, since market prices are higher for fresh fruits. More precisely, as far as T&T is
concerned, all fruits are consumed locally, except for a very small volume of exports to the neighbouring
island of Barbados. The distribution of the harvest between marketing fresh or sale to the factory for
processing is heavily influenced by the size of the harvest, which in turn determines prices on the fresh
fruit market. In a good harvest as much as 60% may be directed to the processing plant. This figure can
drop to 40% in a worse than average harvest The price paid by the processing plant is fixed, while that in