On January 17, the Argentine lemon industry signed an important trade agreement with the U.S. Department of Commerce after a year of intense negotiations. FreshFruitPortal.com spoke with José Carbonell, president of the Argentine Citrus Federation (Federcitrus), who explained that the agreement has its roots in a 15-year history, influenced by Argentina’s large share of the U.S. lemon juice supply.

He explained that the agreement suspends tariffs on lemon juice imports to the United States, provided a reference price is maintained and 85% of Argentine exports fall within its scope.

Carbonell added that the agreement expired in 2024, after which tariffs could theoretically be reinstated. This situation, he noted, led to a series of negotiations and discussions with the U.S. Department of Agriculture, the Department of Foreign Affairs, and their counterparts in California, who are the U.S. juice producers.

Finally, Carbonell said a basic agreement was reached, “where all Argentine lemon juice producers have signed, except for two. On the U.S. side, the agreement is accepted based on the commitment of all signatories to adhere to the agreed-upon prices strictly.”

Prices

The president of Federcitrus explained that different juice categories determine prices.

“Typically, the value of 400 GPL juice is used as a reference, and its value has decreased by around $500 compared to the previous minimum reference price, reflecting market realities,” he pointed out.

It’s important to note that the trade agreement was signed under the previous U.S. administration, led by President Joe Biden. “We are confident that it will be preserved. It is also administratively closed and benefits both parties clearly,” Carbonell said.

In this context, he highlighted that Argentina supplies two-thirds of the world’s industrial lemon derivatives. “So for every three tons of lemon juice produced globally, two come from Argentina.”

Regarding the agreement's significance for Argentina, he emphasized, “It is crucial to secure such a large and substantial market like the U.S., which plays a key role in the global juice export distribution. I believe this agreement offers clear benefits for both parties.”

“We faced significant challenges, as the total value of juice has decreased substantially in recent years. Meeting the limits of the previous agreement was practically impossible. I wish the market had validated the values agreed upon in the past agreement.”

However, he expressed confidence: “We are optimistic that the market will validate the current values, as prices are currently slightly above those set by the spot market.”

The U.S. market and current trends

Carbonell further explained that the U.S. traditionally offers the highest prices for lemon juice.

Regarding the lemon industry’s current situation, he noted that demand for juice has increased in recent months, which has driven prices up.

“This generates hope for us in Argentina that we will be able to meet the agreed prices, meaning that the spot market validates the prices agreed with the U.S., that there will be an equivalence between both,” he said.

As for the new administration, Carbonell clarified, “They want to preserve U.S. production. However, in our case, we’re not pushing anyone out of the market; we simply supply what the U.S. market doesn’t produce.”

When asked about the impact on the Argentine industry, Carbonell explained that “the vast majority of our industrial producers have reacted very positively and have worked hard to reach this agreement. We are very satisfied with the level of participation and the effort they put in.”

He also thanked the Argentine Foreign Ministry for managing and facilitating the entire process leading to the agreement.

Challenges

Finally, Carbonell noted that one factor that could affect the upcoming Argentine lemon campaign is that several thousand hectares have been removed from Argentina's productive areas due to the crisis the industry has faced in recent years.

“Additionally, we experienced severe frosts in July last year, which leads us to expect a campaign with lower volumes. The fruit intended for industrial use will be particularly affected,” he added.

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