India, one of the top five fresh apple importers in the world, on Monday, May 8, 2023, introduced new changes to the import procedures for apples. The move is viewed as an effort to limit access to its market for suppliers of cheap apples. Now it will be impossible to ship apples to India at a price of less than 50 Rs per kg on a CIF basis, which is equivalent to approximately US$0.61 per kg. An exception to the rules was made for only one country – for Bhutan, which isn’t anywhere near being a large exporter of apples.
According to EastFruit analysts, in 2022 India imported 392,000 tons of apple worth $320 million. Only four other countries in the world: Germany, UK, Egypt, and Indonesia spent more on apple imports than India.
Also see: Unexpected facts and typical misconceptions about the Indian apple market from EastFruit
About 60% of all apples in 2022 were supplied to India by five countries: Turkey, Italy, Iran, Chile and New Zealand. Other relatively large suppliers are South Africa, Poland, UAE (re-exports) and Brazil. The United States, which for many years was the largest supplier of apples to India, fell out of the top ten exporters in 2023.
Interestingly, among the top 15 suppliers of apples to India, there are only two countries that in 2022 supplied apples at the average prices below 61 cents per kg. These are Iran, which averaged an apple import price of just 50 cents per kg, and the UAE, which sold an apple to India at an average of 51 US cents per kg. Most likely apple supplied to India from the UAE, according to market participants, are in fact the Iranian apple re-exported via traders in the UAE.
Accordingly, India’s restrictive measures could be called “sanctions against cheap Iranian apples”, which is the only supplier that can compete in price with the locally grown Indian apples.
This may indeed lead to an increase in domestic prices for fresh apples in India. It could also support apple suppliers from Turkey and Poland to India, as these are next leaders in terms of price competitiveness after Iran. Turkish and Polish apples were imported to India in 2022 at average prices of 75 to 85 cents per kg. Accordingly, they do not fall under the new restrictions.
However, EastFruit experts think that Iranian apples will in fact continue to be supplied to the Indian market, but the invoice price will be elevated to the required level.
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