Record Fresh Apple Future Prices in China Amidst Poor Crop

Prices of several futures contracts for fresh apples reached record highs this month on China’s Zhengzhou Commodities Exchange.

On August 20, amidst record high prices for several futures contracts, contracts for delivery of fresh Fuji apples to be delivered in March of 2019 were trading at RMB 12,478 ($1,823.60) per ton. Contracts for delivery in October of 2018, November of 2018 and January of 2019 have also hit record highs recently.

Analysts said the major reason was the violent cold fronts that swept through many key apple producing regions in northern China during early April. As a result of damage done by these cold snaps, China’s Apple crop is expected to drop 25 to 35% this year.

For those apples that did survive the cold snaps, early ripening gala varieties are already on the market, as suppliers are simultaneously clearing out remaining stock of cold storage Fujis.

Wholesale prices for early-ripening apples that have recently hit the market have also been trending upward, with prices generally up about RMB 0.6 to 1 per kilo compared to last year. Cold storage Fuji apples have been fetching a wholesale price of around RMB 5 to 7.6 per kilo depending on the grade and selling location.

Fresh Fuji apple futures were originally introduced on the Zhengzhou Commodities Exchange in December of last year. The futures have become a popular product, with large transaction volumes, but also a fair amount of volatility.

Overall, Chinese apple producers have been suffering in recent years from large expansion of orchard plantations, which has led to excess supply. Consumers are also gradually turning away from commodity apples and expressing greater demand for new and noel varieties and higher quality.

China is the world’s largest exporter of apples.