Argentinian lemon production for the 2021/22 season rose to an estimated 1.90 million metric tons from the previous 1.8 million tons thanks to favorable weather conditions, with orchards able to recover after a period of drought followed by heavy rains, according to a USDA report.

Lemon exports are forecast to reach 260,000 metric tons – up 30,000 tons from official estimates – as a result of the higher production.

However, the Argentinian lemon sector continues to face some significant challenges: export costs are up by 100% due to the combined impact of container availability shortages and higher fleet costs.

The report said both factors, the result of the Covid-19 pandemic and global inflation, were affecting Argentina’s lemon industry as a whole.

The Covid and inflation-linked difficulties come on top of long-standing economic and financial challenges for Argentinian exporters, which the report said was eroding their ability to compete with other South Hemisphere citrus-producing nations, notably Chile and South Africa.

Argentinian lemon production, which is focused on the Tucumán, Jujuy and Salta provinces in the country’s northwest, faced a difficult spring 2020 with severe drought impacting blossom and fruit set in the regions, resulting in reduced volumes.

However, heavy rains during the summer helped lemon orchards recuperate and increased production about low initial estimates. 

This was followed by mild winter temperatures and more rainfall than the previous year, which both contributed to an exceptional 2020/21 season in production terms. 

On the export front, the country’s lemon producers have been diversifying away from traditional markets such as the European Union and Russia into the U.S. and Canada, as well as other, non-traditional destinations, from China and Mexico to Saudi Arabia and the United Arab Emirates. 

Exports to the U.S. in particular have seen a marked rise over the last six years, growing from 10,640 tons in 2017/18 to 40,000 tons of lemons for the 2021/22 season.

However, although fresh lemon exports remain profitable, the USDA said the sector’s competitiveness had been affected by significant production cost increases – notably the cost of labor, inputs and energy – as well as the container shortage and the high ocean shipping rates. 

But while fresh exports recorded a positive season, the lemon industry in Argentina is largely dominated by processing, with as much as 70-75% of total production destined for uses such as essential oil, frozen pulp and dehydrated peel.

Such exports have also been negatively impacted by growing global competition and domestic economic contraction, the report found.