400,000 tonnes of lemons, or 400 million kilos, have been left unharvested on the trees in Spain this year. It doesn’t pay anymore. So much has been produced that the purchase price has plummeted, and without covering the costs, it is the end of the exercise. The result is a loss of €120 million, something that is unprecedented, warn agricultural organisations.
2024 will be a very bad year for lemon growers in Spain. The sector is sounding the alarm. This time, it is not the drought in the countryside that is the culprit, but a gigantic gap between (over)production and market demand. The supply has increased enormously due to the actions of investors.
Investment funds want crops with quick profitability
Investment funds have had a lot to say about this outcome. A large part of this overproduction comes from the pursuit of profit. “The funds have started to invest in lemon”, investing in companies that produce and process citrus fruits, Pedro Gomariz, head of citrus of the agricultural organisation COAG, commented to newspaper, Europa press. “There are very few of them and they have grown up,” he explains.
This influx of funds led to the stimulation of lemon cultivation, which came out of another crisis. Small farmers regained their confidence. In an effort to take advantage of the upward movement, more than 16,800 hectares of lemon trees have been added. The lemon tree takes about ten years to reach its full yield. At that time, competition from other countries was emerging and the market was tightening.
Almond, pistachio, avocado and olive groves
Data from the Spanish Ministry of Agriculture shows the growing interest of the funds. They prefer stable crops with predictable yields. These are, for example, olives, almonds, pistachios and avocados. Over the past ten years, their surface area has increased by 9%. The increase in pistachio trees is particularly striking. Within five years, Spain could be the largest producer in the world.
It is not inconceivable that the same thing will happen with these crops as with the lemon. If too much is produced, the market collapses and prices fall.
Also read: Farmers choose to burn or throw away crops