PRODUCTION & SPONSORED BY UTILIZATION 2016 ANALYSIS

Table of Contents

Introduction...... 3

2015 Crop: U .S . Production and Utilization Summary...... 4 • U.S. Production: Volume and Value...... 4 • 2015 Crop Value...... 4 • U.S. Utilization...... 6 • U.S. Crop Movement ...... 9 • U.S. Exports and Imports...... 9

2016 Crop: U .S . Production Forecast...... 11

2016 Crop: U .S . Varietal Analysis...... 14 • 2016 Varietal Estimates ...... 14

2016 Crop: U .S . Utilization and Movement Forecasts ...... 20 • Total Canned Apple Products...... 20 • Concentrate...... 20 • Frozen Apple Products...... 21 • Dried Apple Products...... 21 • Fresh Apple Slices...... 21 • Processing vs. Fresh Market Utilization Forecasts...... 23 • 2016 Crop Movement Forecast...... 23

International Market Outlook...... 26 • 2016 U.S. Trade Outlook ...... 29 • European Crop Outlook...... 30 • Canadian Crop Outlook...... 34

Appendix A: Apple Juice Concentrate Prices ...... 36

© 2016. The Production and Utilization Analysis for the 2016 U.S. Apple Association Apple Crop Outlook and Marketing Conference is published by the U.S. Apple Association (USApple). Reproduction in whole or in part of the material contained herein is prohibited without prior permission from USApple. For more information, contact Mark Seetin, Editor, at USApple at 8233 Old Courthouse Road, Suite 200, Vienna, Virginia 22182- 3816, telephone 703-442-8850, facsimile 703-790-0845, web site www.usapple.org. Tables and Figures

Table 1: Historical U.S. Apple Annual Production and Five-Year Averages...... 5 Table 2: Season-Average Apple Prices Received by U.S. Growers...... 6 Table 3: Trends in Average Apple Prices Received by U.S. Growers...... 7 Table 4: U.S. Per-Capita Utilization of and Apple Products...... 9 Table 5: Comparison of Forecasted 2016 U.S. Apple Crop with 2015 and Five-Year Average. . . . . 12 Table 6: U.S. Apple Production, By Region...... 12 Table 7: U.S. Apple Production, By State...... 13 Table 8: Total U.S. Apple Production, By Variety...... 15 Table 9: U.S. Apple Production, By Variety, Region...... 16 Table 10: U.S. Crop Distribution, By Variety Grouping, Region...... 17 Table 11: U.S. Apple Juice Imports ...... 20 Table 12: Utilization Summary, By U.S. Production Region...... 22 Table 13: U.S. Processing-Apple Utilization: Volume...... 23 Table 14: U.S. Processing-Apple Utilization: Value...... 24 Table 15: U.S. Apple Utilization Summary...... 24 Table 16: U.S. Utilization, Movement and Storage Holdings ...... 25 Table 17: U.S. Apple Balance of Trade...... 26 Table 18: Top 20 U.S. Apple Export Markets...... 27 Table 19: Apple Imports by Country and Year...... 29 Table 20: European Union Apple Production, By Country...... 30 Table 21: European Union Apple Production, By Variety...... 31 Table 22: Other European and Perimeter Countries, By Country...... 32 Table 23: Canadian Apple Production, By Province...... 32 Table 24: Canadian Apple Production, By Variety...... 33 Table 25: USDA Purchases of Apples and Apple Products...... 35

Figure 1: U.S. Apple Production (line graph)...... 8 Figure 2: U.S. Apple Production (bar graph) ...... 8 Figure 3: Utilization of 2015 U.S. Apple Crop...... 10 Figure 4: Trends in U.S. Production for and ...... 14 Figure 5: Trends in Production for Other Top U.S. Varieties...... 18 Figure 6: Western U.S. Production ...... 19 Figure 7: U.S. Production ...... 19 Figure 8: U.S. Crop Utilization...... 21 Figure 9: U.S. Apple Exports...... 28 Figure 10: U.S. Apple Exports, by Month for Various Crop Years...... 28 Figure 11: U.S. Apple Imports, by Year ...... 28 Figure 12: U.S. Apple Imports, by Month for Various Crop Years ...... 29 Figure 13: U.S. Fresh Apple Exports as Percent of U.S. Fresh Production...... 34 Figure 14: U.S. Fresh Apple Imports as Percent of U.S. Fresh Production ...... 35

Appendix A: Monthly Apple Juice Concentrate Prices (Table)...... 36 Monthly Apple Juice Concentrate Prices (Graph) ...... 40

2 U.S. Apple Association Introduction

The 2016 edition of the U.S. Apple Association (USApple) Production and Utilization Analysis provides an overview of the production and utilization of U.S. apple crops for recent years and forecasts for the 2016 crop marketing season. The source for much of the production information, including the 2016 forecast, is the U.S. Department of Agriculture (USDA). Varietal data and related commentary have been prepared by USApple. Data on the European crop is provided courtesy of the World Apple and Pear Association (WAPA) from Prognosfruit, the European counterpart to USApple’s Outlook and Marketing Conference. The utilization information contained in this book is a mixture of USDA-published data and USApple forecasts, based on reports from apple processors and other reporting organizations.

USApple is grateful to all who contributed information for this report, including the USDA, the World Apple and Pear Association, the Canadian Horticultural Council, the Ontario Ministry of Agriculture and Rural Affairs, the Federation des Producteurs de Pommes du Quebec, the New Brunswick Apple Marketing Board, the Nova Scotia Fruit Growers Association, The Food Institute and Agrarmarkt Informations-GmbH. USApple would also like to express appreciation to Agnes Perez, USDA Economic Research Service (ERS), for her assistance in gathering and analyzing data on processed apple products, as well as to Katy Looft, Agricultural Economist with USDA’s Agricultural Marketing Service (AMS) Fruit and Vegetable Division for her work on the Apple Compendium.

Finally, USApple would like to express thanks and appreciation to Bayer CropScience for their continued support of this important industry publication.

2016 Production & Utilization Analysis 3 2015 Crop: U.S. Production and Utilization Summary

Highlights of production and utilization of the 2015 apple crop follow. Tables appearing throughout this publication provide detailed information on the 2015 crop, including comparisons to crops from previous 5-year and 10-year periods.

U .S . Apple Production: Volume and Value

The 2015 crop, at 238.2 million bushels, was the fifteenth largest apple crop since the U.S. Department of Agriculture (USDA) began reporting statistics on commercial apple production. The record crop of 277.3 million bushels was produced in 1998. Historical crop data are found in Table 1, and Figures 1 and 2.

Apple production in Washington State of 141.7 million bushels in 2015 was 18 percent below the 173.8 million bushels produced in 2014 and 4 percent below the average production of 147.7 million bushels for the previous five years (Table 7). In California, production of 3.5 million bushels in 2015 was 39 percent below the state’s 2014 production, and 39 percent below the five-year average for production in the state. Michigan 2015 apple production was 23.7 million bushels, 3 percent less than the state’s 2014 production and 14 percent above the five-year average of 20.8 million bushels. In New York, production of 32.4 million bushels in 2015 was 5 percent higher than 2014 production and 13 percent above the five-year average production. Pennsylvania 2015 apple production of 12.4 million bushels was 5 percent above 2014 and 7 percent above the five-year average.

Production in the West, at 150 million bushels, accounted for 63 percent of total national production in 2015, and was 6 percent below the five-year average for the region. The crop in the rest of the country, at 88 million bushels, accounted for 37 percent of the total crop in 2015, and was 10 percent above the five-year average. Tables 5 and 6 detail regional production, by year, and include comparisons to the five-year average.

Fresh-market varieties represented 77 percent of the apples harvested from the 2015 national crop (Table 10), which is 2 percentage points less than that of 2014. In 2013, fresh varieties made up 76 percent of the crop, 8 percent below the share they held in 2012. Production of dual-purpose varieties increased from 11 percent of total production in 2014 to a 13 percent share in 2015.

Production of Red Delicious apples decreased by19 percent to 50.2 million bushels from 2014 to 2015. The 2015 Golden Delicious crop, at 21.8 million bushels was 19 percent lower than the 26.9 million bushels produced in 2014 (Table 8).

2015 Crop Value

USDA figures on grower level prices for 2015 indicate that the season-average price to growers for all sales was 34.2 cents per pound, an 8.5 cent per pound increase from the average price of 25.7 cents per pound in 2014, and 13 percent more than the 30.3 cents per pound average of 2013 (Table 2).

4 U.S. Apple Association Table 1: Historical U.S. Apple Production and Five-Year Averages (000 42-lb. Units)

YEAR PRODUCTION YEAR PRODUCTION YEAR PRODUCTION 1942 126,707 1967 129,428 1992 251,631 1943 87,310 1968 130,215 1993 254,400 1944 121,266 1969 162,372 1994 273,821 1945 66,686 1970 152,305 1995 252,024 1946 118,901 1971 151,693 1996 247,188

1947 112,892 1972 140,032 1997 245,805 1948 89,330 1973 148,539 1998 277,295 1949 134,002 1974 155,539 1999 253,112 1950 124,477 1975 179,285 2000 209,360 1951 111,369 1976 154,126 2001 248,586

1952 94,415 1977 158,871 2002 231,069 1953 95,368 1978 180,879 2003 209,360 1954 111,765 1979 193,882 2004 248,586 1955 106,234 1980 210200 2005 231069.0476 1956 101,315 1981 184,610 2006 233,890

1957 119,258 1982 193,381 2007 216,414 1958 127,485 1983 199,357 2008 229,364 1959 126,847 1984 198,405 2009 231,069 1960 108,705 1985 188,440 2010 220,990 1961 126,725 1986 187,119 2011 224,405

1962 125,794 1987 255,764 2012 214,102 1963 126,420 1988 217,143 2013 248,371 1964 150,461 1989 236,114 2014 272,171 1965 146,197 1990 229,924 2015 238,189 1966 137,178 1991 231,112 2016 248,024 FIVE-YEAR AVERAGES 1941-45 104,174 1966-70 143,580 1991-95 206,375 1946-50 115,920 1971-75 155,018 1996-00 246,552 1951-55 103,830 1976-80 179,592 2001-05 233,734 1956-60 116,722 1981-85 192,839 2006-10 226,346 1961-65 135,119 1986-90 225,213 2011-15 239,448 TOP TEN APPLE PRODUCTION YEARS YEAR PRODUCTION YEAR PRODUCTION 1998 277,295 1999 253,112 1994 273,821 1995 252,024 2014 272,171 2000 251,993 1987 255,764 1992 251,631 1993 254,400 2004 248,586

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary, various years and Crop Production, Aug. 12, 2016. F=Forecast

2016 Production & Utilization Analysis 5 2015 Crop: U.S. Production and Utilization Summary

The season-average price for fresh-market apples was 45.0 cents per pound in 2015 which is 38 percent more than the 32.7 cents per pound average of 2014, and 11 percent more than the 2013 average price 40.5 cents per pound.

At $201 per ton, the average value of processing apples in 2015 was 13 percent more than the $178 per ton value in 2014, and 2 percent more than the 2013 price of $197 per ton. The average juice-apple price of $130 per ton in 2015 was up 7 percent from the 2014 average of $122 per ton and 10 percent below that of 2013 when average juice-apple prices were $145 per ton.

Total farm-gate revenue of $3.39 billion in 2015 was 18 percent higher than 2014 when total revenue was $2.87 billion. The total value of fresh apple production increased by 20 percent to $3.09 billion in 2015 from a value of $2.58 billion in 2014. The value of processing apple production increased by 5 percent from $293 million in 2014 to $308 million for the 2015 crop. Table 2 includes season-average apple prices received by U.S. growers from 2012 through 2015, while Table 3 includes historical data on prices for various uses.

U .S . Utilization

USDA’s preliminary estimate for total U.S. per-capita utilization of apples and apple products in 2015 was 46.3 pounds; 0.8 pound per person more than in 2014. Per capita consumption of fresh apples stood at 17.1 pounds, which is 103 percent of the 5 year average. (Table 4). The total amount of apples processed in 2015 was 73.1 million bushels, compared to 78.3 million bushels in 2014, and 82.0 million bushels in 2013 (Table 13). Table 12 provides a summary of how the crop was utilized by production region.

Table 2: Season-Average Apple Prices Received by U.S. Growers, 2012-2015 Crop Years

2012 2013 2014 2015

All sales (cents per pound) 37.10 30.30 25.70 34.20 Fresh consumption (cents per pound) 45.30 40.50 32.70 45.00 All processing (dollars per ton) 281.00 197.00 178.00 201.00 Canned (dollars per ton) 395.00 223.00 202.00 238.00 Juice and (dollars per ton) 221.00 145.00 122.00 130.00 Frozen (dollars per ton) 328.00 233.00 234.00 243.00 Dried (dollars per ton) 176.00 191.00 152.00 186.00 Fresh slices (dollars per ton) 302.00 383.00 425.00 409.00 Other (dollars per ton)1 243.00 NA NA NA

Value of Fresh Production (000) $2,987,611 $2,792,848 $2,577,739 $3,085,971 Value of Processing Production (000) $327,385 $340,088 $293,006 $308,214 Total Farm-Gate Value of Production2 (000) $3,314,996 $3,132,936 $2,870,745 $3,394,185

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary, various years. NA = not available. 1 NASS did not report a category “Other” for 2013-15 in the Noncitrus Fruit and Nuts 2015 Summary, released July 6, 2016. 2 Total revenue to growers from fresh and processing sales.

6 U.S. Apple Association Table 3: Trends in Average Apple Prices Received by U.S. Growers, According to Type of Utilization

ALL SALES FRESH ALL PROCESSING (cents per pound) (cents per pound) (dollars per ton) YEAR ANNUAL 5-YR AVG ANNUAL 5-YR AVG ANNUAL 5-YR AVG 1997 15.4 14.5 22.1 20.3 130.00 136.20 1998 12.2 13.8 17.3 19.7 94.60 112.30 1999 15.0 14.7 21.3 20.6 128.00 133.72 2000 12.8 15.1 17.8 21.1 101.00 136.52 2001 17.4 14.3 24.4 19.9 106.00 124.92 2002 23.2 16.1 30.1 22.2 198.00 125.52 2003 23.1 18.3 29.4 24.6 131.00 132.80 2004 13.5 18.0 18.1 24.0 107.00 128.60 2005 17.4 18.9 24.4 25.3 106.00 129.60 2006 22.7 20.0 31.6 26.7 129.00 134.20 2007 28.8 21.1 38.3 28.4 190.00 132.60 2008 23.2 21.1 30.1 28.5 198.00 146.00 2009 23.1 23.0 31.4 31.2 132.00 151.00 2010 25.1 24.6 32.6 32.8 187.00 167.20 2011 30.3 26.1 39.4 34.4 226.00 186.60 2012 37.1 27.8 45.3 35.8 281.00 204.80 2013 30.3 29.2 40.5 37.8 197.00 204.60 2014 25.7 29.7 32.7 38.1 178.00 213.80 2015 34.2 31.5 45.0 40.6 201.00 216.60

PROCESSING UTILIZATION (all in dollars per ton) CANNED JUICE AND CIDER FROZEN DRIED YEAR ANNUAL 5-YR AVG ANNUAL 5-YR AVG ANNUAL 5-YR AVG ANNUAL 5-YR AVG 1997 172.00 157.80 92.00 117.82 185.00 177.60 107.00 141.40 1998 165.00 168.50 57.70 74.85 146.00 165.50 75.50 91.25 1999 155.00 168.20 109.00 108.76 158.00 178.20 124.00 128.10 2000 147.00 169.80 75.10 111.74 150.00 180.00 71.20 133.90 2001 149.00 167.80 67.90 96.16 134.00 173.00 119.00 109.94 2002 240.00 171.20 140.00 89.94 250.00 167.60 75.60 93.06 2003 154.00 169.00 103.00 99.00 173.00 173.00 107.00 99.36 2004 149.00 167.80 70.50 91.30 173.00 176.00 73.60 89.28 2005 149.00 168.20 67.90 89.86 134.00 172.80 119.00 98.84 2006 158.00 170.00 102.00 96.68 167.00 179.40 61.90 87.42 2007 184.00 158.80 179.00 104.48 238.00 177.00 182.00 108.70 2008 240.00 176.00 140.00 111.88 250.00 192.40 75.60 102.42 2009 161.00 178.40 91.90 116.16 154.00 188.60 53.00 98.30 2010 207.00 190.00 149.00 132.38 198.00 201.40 143.00 103.10 2011 230.00 204.40 198.00 151.58 246.00 217.20 214.00 133.52 2012 395.00 246.60 221.00 159.98 328.00 235.20 176.00 132.32 2013 223.00 243.20 145.00 160.98 233.00 231.80 191.00 155.40 2014 202.00 251.40 122.00 167.00 234.00 247.80 152.00 175.20 2015 238.00 257.60 130.00 163.20 243.00 256.80 186.00 183.80

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary, various years. Note: The 5-year average is based on the current year and the previous four years.

2016 Production & Utilization Analysis 7 2015 Crop: U.S. Production and Utilization Summary

Processors converted 31 percent of the 2015 crop into apple products, which was 2 percentage points above the 29 percent converted in 2014 and roughly 2 percentage points less than the 33 percent of the 2013 crop used for processing (Table 16). The percent of the crop sold as fresh-market apples in the

Figure 1: U.S. Apple Production, 1962-2016

300,000

250,000

200,000 2016 (F) 248,024

42 - lb. Bushels (000) 150,000

100,000 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

Source: USDA

Figure 2: U.S. Apple Production, 2011-2016

290,000

272,171 270,000

250,000 248,371 248,024 238,189 239,448 224,405 230,000 000 42-lb. Units 214,102 210,000

190,000 2011 2012 2013 2014 2015 2016 F 5-YEAR

Source: USDA F = Forecast

8 U.S. Apple Association domestic market held steady at 50 percent in 2015, matching the 50 percent of the 2014 crop. Fresh exports from the 2015 crop were 18 percent of total production, slightly less than the 19 percent in 2014 and roughly equal to the 18 percent in 2013.

The portion of the crop that was used in canned products was 11 percent in 2015, which was 1 percentage point higher than the 10 percent in 2014. The portion of the crop used in juice and cider held steady with 13 percent in 2014 equaling the 13 percent utilized in 2015 (Table 15). The portion of the crop used in frozen products was steady at 2 percent in 2014 and 2 percent in 2015. Figure 3 depicts percent- ages of how the 2014 crop was utilized.

U .S . Crop Movement

Thirty-eight percent of the 2015 crop was moved prior to December 1, 2015, with 31.2 million bushels being processed, and 38.4 million bushels used in the domestic fresh market during this period (Table 16). The supply of apples in storage on December 1, 2015 was 148.2 million bushels, of which 83 percent was in long-term controlled atmosphere storage.

U .S . Exports and Imports

Exports of U.S. apples from the 2015 crop decreased by 20 percent to 42.5 million bushels from 2014 crop exports of 52.9 million bushels (Table 18). The decrease in exports resulted from lower volumes

Table 4: Per-Capita Utilization of Apples and Apple Products (Pounds, Fresh Weight Equivalent)

SEASON FRESH CANNED JUICE FROZEN DRIED OTHER TOTAL

2005/06 16.66 4.18 22.25 0.66 0.73 0.54 45.03 2006/07 17.73 4.20 26.36 0.90 0.97 0.60 50.75 2007/08 16.39 3.96 27.17 0.86 0.90 0.52 49.82 2008/09 15.90 4.61 25.05 0.75 0.88 0.78 47.96 2009/10 16.25 4.18 24.92 0.73 0.61 0.63 47.32 2010/11 15.29 3.98 26.37 0.57 0.65 0.71 47.57 2011/12 15.44 4.17 20.60 0.69 0.60 0.99 42.49 2012/13 16.01 3.15 22.48 0.30 0.87 0.57 43.39 2013/14 17.32 4.66 21.25 0.79 0.64 0.82 45.46 2014/15 18.60 4.22 20.43 0.75 0.70 0.79 45.48 2015/16F 17.11 4.15 22.60 0.81 0.69 0.92 46.29

Source: USDA Economic Research Service, Crops Branch. Per Capita numbers approximate the trend and general level of consumption over time. Annual consumption estimates do not’reflect changes in stocks. Therefore, the numbers do not reflect actual year-to-year changes in consumption. Per Capita figures are adjusted for imports and exports, and include shipments to territories. F = Forecast by USDA Economic Research Service, Crops Branch. Other includes vinegar, wine, slices for pie-making and fresh slices.

2016 Production & Utilization Analysis 9 2015 Crop: U.S. Production and Utilization Summary

of exports to Mexico, Canada, Taiwan, India, Indonesia, United Arab Emirates and Hong Kong. The top three destinations for U.S. apple exports and their percentage of total exports were Mexico at 29 percent, Canada at 17 percent and India at 6 percent.

Fresh-market apple imports declined by 1 percent from 9.7 million 42-pound bushels in the 2014 crop year to 9.6 million bushels in the 2015 crop year (Table 19). Chile was the largest source of fresh apple imports, accounting for 55 percent of total imports. New Zealand and Canada followed, capturing approximately 23 and 14 percent of total imports, respectively. As a result of the U.S. China trade agreement finalized in early 2015, 116,200 bushels of fresh apples were imported into the U.S. from China, accounting for 1 percent of U.S. apple imports for the 2015 crop season. The yearly balance of trade for fresh apples and equivalent trade in juice apples is illustrated in Table 17.

The 2015-16 estimate of 512 million gallons single-strength equivalent for U.S. apple juice imports represents an 18 percent increase from 432 million gallons imported in 2014-15. Table 11 shows imports of apple juice on a single-strength equivalent basis and on a bushel-equivalent basis.

Figure 3: Utilization of 2015 U.S. Apple Crop

Fresh Slices 1.9%

Frozen 2.3% Dried 1.8% Other Products 1.1%

Juice 12.7% 68.5% Fresh

Total Canned 10.8%

Not Marketed 0.8%

Source: USDA, National Agricultural Statistics Service.

10 U.S. Apple Association 2016 Crop: U.S. Production Forecast

On August 12, 2016, the U.S. Department of Agriculture (USDA) forecast the 2016 U.S. apple crop at 10.4 billion pounds. Measured in 42-pound bushels, the crop is forecast to be 248.0 million bushels. This is 10 million bushels more than 2015 production in the U.S. and 9 million bushels above the average U.S. production for the past five years of 239.4 million bushels.

Production for 2016 in the East is forecast to decrease by 10 percent while Midwest production is expected to increase by 10 percent. The Western forecast projects an increase of 9 percent compared to 2015.

In the East, the 2016 crop is forecast at 53.8 million bushels, down 10 percent from 2015 and 2 percent below the five-year average. The 2016 New York crop, at 28.6 million bushels, is forecast to be 12 percent less than 2015 and equal to the five-year average. The Appalachian region (Maryland, Pennsylvania, Virginia and West Virginia) 2016 production is forecast at 18.9 million bushels, down 6 percent from 2015. The New England Region (Connecticut, Maine, Massachusetts, and Vermont) crop is forecast to decrease by 17 percent from 3.9 million bushels in 2015 to 3.2 million bushels in 2016, and production in the Southeast is expected to decrease from the 2015 crop in that area. See Tables 5 and 6 for regional crop production data.

Production from the Midwestern region, forecast at 31.5 million bushels, is forecast to be up 10 percent from the 2015 production of 28.7 million bushels and is 23 percent above the five-year average. Michigan’s crop is forecast at 28.6 million bushels, 21 percent above last year’s crop of 23.7 million bushels, and 37 percent above the five year average. The combined Eastern and Midwestern crop for 2016 is forecast at 85.3 million bushels, down 4 percent from 2015, but 6 percent above the five-year average.

The Western crop is forecast at 163 million bushels, a 9 percent increase from 2015, and 2 percent above the five-year average. Washington State is forecast to produce 152 million bushels, 8 percent above its 2015 production, and approximately 3 percent more than the average production over the past five years. California production for 2016 is forecast at 5.0 million bushels, 44 percent more than the 2015 production but 13 percent below the five-year average for the state.

Apple production in Oregon is forecast at 3.9 million bushels, 32 percent greater than the 2015 crop. Idaho is forecast to produce 1.4 million bushels in 2016, an increase of 30 percent from 2015. In 2016, the USDA discontinued production estimates for the Southwestern states of Arizona, Colorado and Utah. Table 7 for 2016 production forecasts and historical data by state and region.

2016 Production & Utilization Analysis 11 2016 Crop: U.S. Production Forecast

Table 5: Comparison of Forecasted 2016 U.S. Apple Crop with 2015 and Five-Year Average (000 42-lb. Units)

2016 FORECAST COMPARED WITH REGION 2015 2016 FORECAST 5-YEAR AVERAGE 2015 5-YEAR AVERAGE

East 59,755 53,786 55,015 -10% -2% Midwest 28,662 31,500 25,560 10% 23% Total East and Midwest 88,417 85,286 80,574 -4% 6% West 149,772 162,738 158,873 9% 2%

Total United States 238,189 248,024 239,448 4% 4%

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary, various years and Crop Production, Aug. 12, 2016. Note: Columns may not add due to rounding.

Table 6: U.S. Apple Production By Region (000 42 lb. Units)

5-YEAR 2016 2011 2012 2013 2014 2015 AVERAGE FORECAST

Eastern States 55,345 41,802 60,607 57,564 59,755 55,015 53,786 Midwest States 28,786 6,490 34,902 28,957 28,662 25,560 31,500 Total East and Midwest 84,131 48,293 95,510 86,521 88,417 80,574 85,286 Western States 140,274 165,810 152,862 185,650 149,772 158,873 162,738

United States 224,405 214,102 248,371 272,171 238,189 239,448 248,024

REGIONAL SHARE OF U .S . PRODUCTION 5-YEAR 2016 2011 2012 2013 2014 2015 AVERAGE FORECAST

Eastern States 25% 20% 24% 21% 25% 23% 22% Midwest States 13% 3% 14% 11% 12% 11% 13% Total East and Midwest 37% 23% 38% 32% 37% 34% 34% Western States 63% 77% 62% 68% 63% 66% 66%

United States 100% 100% 100% 100% 100% 100% 100%

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary, various years and Crop Production, Aug. 12, 2016. Note: Columns may not add due to rounding.

12 U.S. Apple Association Table 7: U.S. Apple Production by State (000 42 lb. Units)

2016 % CHANGE STATES 2011 2012 2013 2014 2015 FORECAST FROM 2015

New York 29,048 17,143 33,571 30,833 32,381 28,571 -12% Pennsylvania 10,905 11,762 11,167 11,738 12,357 11,667 -6% Virginia 5,238 5,476 4,643 4,643 4,648 4,405 -5% North Carolina 3,333 798 3,690 2,976 2,500 2,619 +5% West Virginia 1,595 2,167 2,262 1,952 2,148 1,905 -11% Vermont 798 607 810 700 862 738 -14% New Jersey 857 833 690 881 874 476 -46% Massachusetts 917 667 1,036 1,031 1,026 929 -10% Maine 690 714 643 905 848 1,000 +18% New Hampshire 429 369 607 402 481 NA NA Maryland 952 833 786 986 976 929 -5% Connecticut 524 393 643 474 598 548 -8% Rhode Island 60 40 60 43 57 NA NA

Total East 55,345 41,802 60,607 57,564 59,755 53,786 -10%

Michigan 23,333 2,738 30,000 24,405 23,690 28,571 +21% Ohio 1,586 786 1,286 1,048 1,202 1,000 -17% Wisconsin 1,224 774 1,143 1,286 1,226 952 -22% Missouri 357 833 402 498 674 NA NA Illinois 952 762 381 500 488 548 +12% Indiana 476 107 714 407 536 NA NA Minnesota 560 321 619 595 621 429 -31% Tennessee 202 152 164 112 110 NA NA Iowa 95 17 193 107 114 NA NA

Total Midwest 28,786 6,490 34,902 28,957 28,662 31,500 +10%

Total East and Midwest 84,131 48,293 95,510 86,521 88,417 85,286 -4%

Washington 129,048 153,571 140,476 173,810 141,667 152,381 +8% California 6,667 6,429 6,429 5,714 3,476 5,000 +44% Oregon 2,202 3,095 3,357 3,690 2,986 3,929 +32% Idaho 1,429 1,786 1,681 1,507 1,098 1,429 +30% Arizona 262 190 393 169 136 NA NA Colorado 214 405 133 212 53 NA NA Utah 452 333 393 548 357 NA NA

Total West 140,274 165,810 152,862 185,650 149,772 162,738 +9%

Total U .S . 224,405 214,102 248,371 272,171 238,189 248,024 +4%

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary, various years and USDA Crop Production, August 12, 2016. NA - In 2016, the USDA discontinued production estimates for the states of New Hampshire, Rhode Island, Missouri, Indiana, Tennessee, Iowa, Arizona, Colorado and Utah.

2016 Production & Utilization Analysis 13 2016 Crop: U.S. Varietal Analysis

The mix of varieties of the 2016 U.S. apple crop is as important to the apple market as the overall volume of total U.S. apple production. The relationship between fresh-market and processing varieties and the supply of certain fresh-market varieties plays an important role in determining market conditions.

In 1981, the U.S. Department of Agriculture (USDA) discontinued its varietal estimate of the national apple crop. Since then, the U.S. Apple Association (USApple) has provided that service to the apple industry. USApple bases its varietal estimate on the total crop forecast provided by USDA. The estimate is calcu- lated from input received from various regional producer organizations, consultations with regional production experts and varietal data collected from storage facilities.

2016 Regional and Varietal Estimates

Under ideal circumstances, the U.S. varietal mix is reasonably distributed across producing regions, and varietal supplies are sufficient to support fresh-market and processing-apple demand for any particular variety. As consumer tastes and market conditions evolve, the industry has historically sought to adjust to those evolving demand situations

Total Western production is forecast to increase by 9 percent from 2015 and will be 2 percent above the five-year average for that region. The larger 2016 crop will result in higher actual volumes, but the

Figure 4: Trends in U.S. Production for Red Delicious and Golden Delicious

n Red Delicious n Golden Delicious 70,000

60,000

50,000

40,000

30,000 000 42-lb. Units 20,000

10,000

0 2011 2012 2013 2014 2015 2016 F

Source: USApple F = Forecast

14 U.S. Apple Association percentage production of Red Delicious in Washington State relative to other varieties is expected to continue to decrease while other varieties such as Gala, and will continue to increase their share of overall production. The production volume for Gala is expected to increase by 17 percent while Fuji volume is projected to increase by 13 percent. See Table 8 for USApple’s varietal fore- cast and Table 9 for variety forecasts by growing region.

Fresh market varieties are forecast to comprise approximately 78 percent of the U.S. crop in 2016. In 2015 and 2014, fresh-market varieties accounted for 77 and 80 percent of the crop respectively. Dual-purpose varieties will make up 35 percent of the Eastern crop and 34 percent of the Midwestern crop, and will comprise 12 percent of overall U.S. production in 2016 (see Table 8).

The varietal picture has changed over the past five years and will continue to change in 2016. Red Delicious still leads varietal production nationally, while Gala holds the second place ranking for 2016, as

Table 8: Total U.S. Apple Production by Variety (000 42 lb. Units)

2016 VARIETIES 2011 2012 2013 2014 2015 FORECAST

Red Delicious 54,156 53,132 56,950 62,262 50,360 53,152 Gala 34,544 36,279 36,951 45,323 37,498 43,978 * 19,290 22,808 21,140 24,523 22,923 21,949 Fuji * 18,767 24,209 22,378 27,402 20,155 22,823 Golden Delicious 23,842 23,305 27,292 26,871 22,149 20,697 Honeycrisp 6,922 7,636 9,631 13,591 13,217 15,296 McIntosh 10,617 6,286 11,577 10,703 11,201 10,008 Rome 8,555 5,335 9,435 8,217 8,194 7,815 Cripps Pink * 3,574 4,587 4,236 5,688 6,942 6,862 6,366 3,228 6,938 6,221 6,447 6,002 York 3,910 4,214 3,910 4,040 4,200 3,876 4,178 1,520 4,974 4,318 4,234 4,322 3,208 1,262 3,552 3,013 2,990 2,952 3,172 1,842 3,046 2,590 2,714 2,447 * 2,868 2,695 2,489 3,098 2,179 1,868 1,545 389 1,440 1,141 1,122 1,295 1,031 949 1,030 1,016 1,039 945 * 1,122 1,507 1,383 1,500 977 893 * 942 1,184 1,110 957 519 596 All Others 15,796 11,735 18,909 19,696 19,128 20,248

Total 224,405 214,102 248,371 272,171 238,189 248,024

Source: USApple * Includes only western production. Eastern and midwest production are included in all others. Note: Sum of varieties may not add up to total due to rounding of individual varieties.

2016 Production & Utilization Analysis 15 2016 Crop: U.S. Varietal Analysis

Table 9: U.S. Apple Production, By Variety, Region (000 42 lb. Units)

2016 VARIETY AREA 2011 2012 2013 2014 2015 FORECAST Red Delicious East 7,268 5,703 7,833 7,486 7,693 7,011 Midwest 5,770 1,267 6,700 5,439 5,393 5,928 West 41,118 46,162 42,417 49,337 37,274 40,213 Total 54,156 53,132 56,950 62,262 50,360 53,152 Gala East 2,564 2,134 3,140 3,020 3,208 2,999 Midwest 2,144 420 2,730 2,767 3,248 3,942 West 29,836 33,725 31,080 39,536 31,041 37,037 Total 34,544 36,279 36,951 45,323 37,498 43,978 Golden Delicious East 7,671 6,245 8,181 7,880 8,072 7,403 Midwest 3,780 957 4,302 3,525 3,524 3,749 West 12,391 16,103 14,810 15,465 10,553 9,546 Total 23,842 23,305 27,292 26,871 22,149 20,697 Granny Smith West/Total 19,290 22,808 21,140 24,523 22,923 21,949 Fuji West/Total 18,767 24,209 22,378 27,402 20,155 22,823 McIntosh East 8,773 5,768 9,340 8,608 9,125 7,933 Midwest 1,844 518 2,237 2,095 2,076 2,075 Total 10,617 6,286 11,577 10,703 11,201 10,008 Rome East 6,430 4,596 7,016 6,282 6,385 5,858 Midwest 1,795 359 2,055 1,594 1,579 1,757 West 330 380 364 341 230 200 Total 8,555 5,335 9,435 8,217 8,194 7,815 Empire East 4,904 2,933 5,243 4,863 5,108 4,516 Midwest 1,462 295 1,695 1,358 1,339 1,485 Total 6,366 3,228 6,938 6,221 6,447 6,002 Cripps Pink West/Total 3,574 4,587 4,236 5,688 6,942 6,862 Braeburn West/Total 2,868 2,695 2,489 3,098 2,179 1,868 Idared East 2,249 1,267 2,583 2,396 2,361 2,090 Midwest 1,928 252 2,390 1,922 1,872 2,232 Total 4,178 1,520 4,974 4,318 4,234 4,322 York East/Total 3,910 4,214 3,910 4,040 4,200 3,876 Jonathan East 195 211 195 202 210 194 Midwest 2,899 916 3,227 2,689 2,698 2,686 West 113 136 130 122 82 71 Total 3,208 1,262 3,552 3,013 2,990 2,952 Cortland East 2,888 1,794 2,692 2,324 2,453 2,146 Midwest 285 48 354 266 261 301 Total 3,172 1,842 3,046 2,590 2,714 2,447 Jonagold West/Total 1,122 1,507 1,383 1,500 977 893 Cameo TM West/Total 942 1,184 1,110 957 519 596 Stayman East 925 883 941 938 952 890 Midwest 106 66 90 79 88 56 Total 1,031 949 1,030 1,016 1,039 945 Honeycrisp East 1,327 1,146 2,158 2,168 2,402 2,250 Midwest 1,073 236 1,731 1,521 1,585 1,789 West 4,522 6,254 5,742 9,902 9,230 11,257 Total 6,922 7,636 9,631 13,591 13,217 15,296 Northern Spy East 443 263 175 161 170 149 Midwest 1,103 127 1,265 980 952 1,146 Total 1,545 389 1,440 1,141 1,122 1,295 All Others East 5,798 4,646 7,199 7,196 7,415 6,471 Midwest 4,597 1,029 6,127 4,721 4,048 4,355 West 5,401 6,060 5,583 7,779 7,666 9,422 Total 15,796 11,735 18,909 19,696 19,128 20,248 TOTAL U .S . 224,405 214,102 248,371 272,171 238,189 248,024

Source: USDA Crop Production, various years; USApple. Note: Sum of varieties may not add to total due to rounding of individual varieties. Includes a benchmark adjustment in variety calculation.

16 U.S. Apple Association it has since 2006, but is steadily narrowing the gap with Red Delicious production. With the 2016 crop, Golden Delicious has fallen to fifth place. On the other hand, Honeycrisp volume continues to grow its share at the national level moving into sixth place in national production. Honeycrisp is estimated to increase by 16 percent for the 2016 crop compared to the prior year (see Table 9). Honeycrisp has moved into sixth place in national production.

Despite its continuing decline in share of national production, USApple estimates that, because of the larger crop forecast total Red Delicious production in 2016 will increase to 53.2 million bushels compared

Table 10: U.S. Crop Distribution, By Variety Grouping, Region (000 42 lb. Units)

2012 2013 2014 2015 2016 AMOUNT % AMOUNT % AMOUNT % AMOUNT % AMOUNT % FRESH¹

East 17,684 42.3% 27,714 45.7% 26,146 45.4% 27,537 46.1% 24,709 45.9% Midwest 2,736 42.2% 15,093 43.2% 13,180 45.5% 13,641 47.6% 15,219 48.3% West 159,369 96.1% 146,915 96.1% 177,530 95.6% 141,876 94.7% 153,116 94.1% Total Fresh 179,789 84 .0% 189,723 76 .4% 216,856 79 .7% 183,054 76 .9% 193,045 77 .8%

DUAL PURPOSE²

East 14,996 35.9% 21,608 35.7% 20,021 34.8% 20,433 34.2% 18,580 34.5% Midwest 2,598 40.0% 12,418 35.6% 10,076 34.8% 10,021 35.0% 10,780 34.2% West 380 0.2% 364 0.2% 341 0.2% 230 0.2% 200 0.1% Total Dual Purpose 17,974 8 .4% 34,390 13 .8% 30,438 11 .2% 30,684 12 .9% 29,560 11 .9%

PROCESSING³

East 4,477 10.7% 4,085 6.7% 4,201 7.3% 4,370 7.3% 4,025 7.5% Midwest 127 1.9% 1,265 3.6% 980 3.4% 952 3.3% 1,146 3.6% West NA NA NA NA NA NA NA NA NA NA Total Processing 4,604 2 .2% 5,350 2 2%. 5,181 1 9%. 5,322 2 2%. 5,171 2 .1%

ALL OTHER4

East 4,646 11.1% 7,199 11.9% 7,196 12.5% 7,415 12.4% 6,471 12.0% Midwest 1,029 15.9% 6,127 17.6% 4,721 16.3% 4,048 14.1% 4,355 13.8% West 6,060 3.7% 5,583 3.7% 7,779 4.2% 7,666 5.1% 9,422 5.8% Total All Other 11,735 5 .5% 18,909 7 6%. 19,696 7 2%. 19,128 8 0%. 20,248 8 .2%

Total 214,102 248,371 272,171 238,189 248,024

Source: USApple. ¹ Braeburn, Cameo, Cripps Pink, Empire, Fuji, Gala, Golden Delicious (West), Granny Smith, Honeycrisp, Jonagold, Jonathan (West), McIntosh, Red Delicious and . ² Cortland, Idared, Jonathan (East and Midwest), Golden Delicious (East and Midwest), Rome, and Stayman. Processing apple varieties represent an insignificant portion of Western production. ³ East and Midwest: Northern Spy, R. I. Greening and York; West: No significant processing apple variety production. 4 These are mostly dual-purpose and processing varieties. Note: Percent for East, Midwest and West refers to percent of total crop in the respective areas. Percent for Total refers to the percent of the total national crop.

2016 Production & Utilization Analysis 17 2016 Crop: U.S. Varietal Analysis

to production of 50.4 million bushels in 2015 (see Figure 4). Red Delicious production volume is expected to increase by 8 percent in the West compared to 2015. In the Midwest, Red Delicious production is fore- cast to be 10 percent above the crop of 2015. Production in the East is expected to decrease by 9 percent in 2016

Nationally, Gala production in 2016 is forecast at 44.0 million bushels, which is up 17 percent from the 2015 crop. 2016 Gala production is expected to decrease by 7 percent in the East and is expected to increase by 21 percent in the Midwest. Production in the West is forecast to decrease by 19 percent. See Figure 7 for an analysis of Gala production.

In 2016 Golden Delicious production is estimated to decrease by 10 percent in the West, and to increase by 6 percent in the Midwest but is expected to decrease by 8 percent in the East compared to 2015 production. Nationally, 2016 Golden Delicious production volume is expected to decrease 7 percent compared to 2015 (see Figure 4). Together, Red Delicious, Gala, and Golden Delicious are expected to make up 48 percent of total U.S. apple production in 2016, approximately 1 percent less than the share of U.S. production that the three varieties comprised in 2015.

2016 Fuji production in the West is expected to increase by 13 percent as compared to 2015. See Figure 6 for an analysis of Western U.S. Fuji production. Production of Granny Smith is forecast to decrease 4 percent as compared to 2015. McIntosh volume is expected to decrease by 13 percent in

Figure 5: Trends in Production for Other Top U.S. Varieties

50,000 n Fuji n Granny Smith n Honeycrisp n Gala n McIntosh 45,000

40,000

35,000

30,000

25,000

000 42-lb. Units 20,000

15,000

10,000

5,000

0 2012 2013 2014 2015 2016 F

Source: USApple F = Forecast

18 U.S. Apple Association the East and to remain steady in the Midwest in 2016 from 2015 production levels. Nationally, McIntosh production in 2016 is forecast to decrease by 11 percent compared to production in 2015. See Figure 5, Table 8 and Table 9 for historical comparisons of varietal production.

Figure 6: Western U.S. Fuji Production (000 42-lb. Units)

30,000 27,402 24,209 25,000 22,378 22,823 20,155 20,000

15,000

000 42 lb. Units 10,000

5,000

0 2012 2013 2014 2015 2016 F

Source: USApple F = Forecast

Figure 7: U.S. Gala Production (000 42-lb. Units)

50,000 45,323 43,978 36,951 37,498 40,000 36,279

30,000

20,000 000 42 lb. Units

10,000

0 2012 2013 2014 2015 2016 F

Source: USApple F = Forecast

2016 Production & Utilization Analysis 19 2016 Crop: U.S. Utilization and Movement Forecasts

The following forecast of the 2016 crop processing apple utilization is based on U.S. Department of Agriculture (USDA) data on the utilization of apples in various processed apple products and information USApple has gathered from apple processing firms.

Total Canned Apple Products

Canned apple products are expected to use 26.0 million bushels of raw product in 2016 (see Table 13). Utilization at this level would be 1 percent more than in 2015.

Apple Juice Concentrate

After increasing steadily in the mid-1980s, imports of single-strength-equivalent apple juice varied from year-to-year in the 1990s. Imports then grew dramatically during the first decade of the twenty-first century. Table 11 illustrates import levels of single-strength-equivalent apple juice over the past five years; import data has also been converted to show the equivalent in bushels of apples and is compared to utili- zation of domestically-produced apples for juice processing.

In 2015, imports of single-strength apple juice equivalents were 18 percent more than 2014 import levels. For the 2015 crop year, imported bushel equivalents represented 83 percent of the total amount of apples used to process apple juice in the United States. Historical prices for apple juice concentrate are included in Appendix A.

Table 11: U.S. Apple Juice Imports (000)

2011/12 2012/13 2013/14 2014/15 2015/16 (F)

Imported Gallons: Single-Strength Equivalent¹ 446,714 507,718 445,854 432,447 512,246 F

Imported Gallons Converted to: 124,433 141,426 124,193 120,459 142,687 Bushel Equivalents¹ Domestic Production in Gallons: 100,667 92,675 126,650 123,350 106,158 F Single Strength Equivalent¹

Domestic Bushels Used for Juice 28,041 25,815 35,279 34,359 29,571

Total Bushel Equivalents Used for Juice 152,474 167,240 159,472 154,818 172,258 (Domestic + Imported)

Imported Bushel Equivalents as Percent of Total 82% 85% 78% 78% 83%

Source: USDA, Economic Research Service, Crops Branch. ¹ Based on a marketing year of August through July. The volume shown as bushel equivalents is based on a conversion rate of 3.59 gallons of single-strength juice per 42-lb. unit. One bushel is equivalent to 42 lbs. F = Forecast by Economic Research Service.

20 U.S. Apple Association The volume of raw product to be utilized for juice processing from the 2016 crop is forecast at the equiv- alent of 172 million bushels. This level of juice-apple utilization would represent 44 percent of the total processing volume, close to the 42 percent utilization rate in 2015.

Frozen Apple Products

Frozen apple utilization from the 2016 crop is forecast at 5.1 million bushels, which is 9 percent lower than 2015 utilization. USApple estimates that 7 percent of total processed apples will go to frozen product, which is slightly less than the percentage of processed apples used for frozen product last year.

Dried Apple Products

In 2016, the dried category is forecast to utilize 4.3 million bushels, which is roughly the same as the amount utilized in 2015. USApple estimates that approximately 6 percent of total processed apples will go to dried products, up from 5 percent in 2014.

Fresh Apple Slices

USDA began tracking the utilization of processed fresh apple slices in 2005. This category used 4.4 million bushels in 2015, and USApple estimates use in 2016 to be 4.4 million bushels.

Information on USDA purchases of apples and apple products for use by schools and low-income feeding programs can be found in Table 25.

Figure 8: U.S. Crop Utilization (Percentage)

n Fresh n Processing 80% 74% 68% 67% 71% 69% 70% 70%

60%

50%

40% 33% 32% 26% 29% 31% 30% 30%

20%

10%

0% 2011 2012 2013 2014 2015 2016 F

Source: USDA, National Agricultural Statistics Service. Note: Based on utilized production. F = Forecast.

2016 Production & Utilization Analysis 21 2016 Crop: U.S. Utilization and Movement Forecasts

Table 12: Utilization Summary, By U.S. Production Region (000 42 lb. Units)

REGIONS FRESH PROCESSED NOT MARKETED TOTAL EASTERN STATES 2011-12 23,560 30,476 1,250 55,286 2012-13 19,279 21,524 960 41,762 2013-14 26,895 31,798 1,402 60,095 2014-15 26,129 30,645 674 57,448 2015-16 27,795 29,493 674 57,962 2016-17 Forecast 24,415 28,378 993 53,786 MIDWESTERN STATES 2011-12 10,664 15,648 664 26,976 2012-13 2,090 1,967 288 4,345 2013-14 14,405 18,667 474 33,545 2014-15 12,426 15,069 148 27,643 2015-16 12,510 14,531 148 27,188 2016-17 Forecast 13,525 16,292 707 30,524 TOTAL EAST AND MIDWEST 2011-12 34,224 46,124 1,914 82,262 2012-13 21,369 23,490 1,248 46,107 2013-14 41,300 50,464 1,876 93,640 2014-15 38,555 45,714 821 85,090 2015-16 40,305 44,024 821 85,150 2016-17 Forecast 37,940 44,670 1,700 84,310 WESTERN STATES 2011-12 114,464 25,471 338 140,274 2012-13 131,871 27,426 76 159,374 2013-14 118,333 27,379 138 145,850 2014-15 144,429 28,548 4,871 177,848 2015-16 118,476 26,310 4,871 149,657 2016-17 Forecast 132,095 28,567 2,076 162,738 OTHER STATES 2011-12 1,362 212 295 1,869 2012-13 3,150 4,336 314 7,800 2013-14 4,410 4,171 193 8,774 2014-15 4,200 4,036 121 8,357 2015-16 4,450 2,731 121 7,302 2016-17 Forecast 536 391 49 976 TOTAL UNITED STATES 2011-12 150,050 71,807 2,548 224,405 2012-13 157,021 55,514 1,567 214,102 2013-14 164,174 82,014 2,183 248,371 2014-15 189,205 77,176 5,790 272,171 2015-16 163,231 73,064 1,894 238,189 2016-17 Forecast 170,572 73,628 3,825 248,024

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruit and Nuts Summary, various years; 2015-16 USApple forecast. Note: Other states include IL, IA, MN, RI, and TN. Sum of column and row may not equal total due to rounding.

22 U.S. Apple Association Processing vs . Fresh-Market Forecasts

USDA forecasts the 2016 U.S. apple-crop at 248 million bushels. Based on this forecast, USApple esti- mates that approximately 171 million bushels will be sold as fresh-market apples, 74 million bushels are forecast to be processed, and approximately 3.8 million bushels will not be marketed.

Utilization by production region is found in Table 12. Comparisons of apple-crop processing utilization volume and value are found in Tables 13 and 14 respectively; overall utilization is summarized in Table 15.

Fresh-market apple utilization in 2016 is expected to increase by 4 percent as compared to 2015. The fresh-versus-processing ratio of crop utilization for the 2016 crop is forecast to be 69 percent fresh and 30 percent processing, with 2 percent of the crop not marketed. For the 2015 crop, 69 percent was sold in the fresh market, 31 percent was used for processed products.

Figure 8 presents the historic utilization breakdown graphically. Table 12 includes a regional breakdown of the crop into fresh-market and processed product destinations. Utilization of the processing portion of the crop estimated for 2016 and for the previous five years is shown in Table 15.

2016 Crop Movement Forecast

USApple estimates that movement of the 2016 crop prior to December. 1, 2016, will be 93 million bushels. Of this, 35 percent will go to processing, 43 percent to the fresh domestic market and 19 percent to fresh exports.

On December. 1, 2016, holdings of 2016 crop apples remaining in storage are forecast to be 155 million bushels, representing 62 percent of the total crop. About 79 percent of these holdings would be in controlled-atmosphere storage. General utilization, movement, and storage data are presented in Table 16.

Table 13: U.S. Processing-Apple Utilization: Volume (000 42-lb. units)

FORECAST 2011 2012 2013 2014 2015 2016

Canned¹ 27,112 17,831 30,105 27,024 25,833 26,048 Juice 30,438 26,479 36,186 35,243 30,331 32,314 Dried 3,655 5,310 3,833 4,071 4,262 4,303 Frozen 6,083 1,586 5,695 5,964 5,536 5,064 Fresh Slices 3,295 3,045 4,488 4,321 4,440 4,381 Other Products 1,690 1,257 1,705 1,674 2,662 1,830

Total 80,281 55,514 82,014 78,298 73,064 73,940

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary, various years. 1 Canned apple products include and canned slices. Note: Sum of processing utilization categories may not add due to rounding.

2016 Production & Utilization Analysis 23 2016 Crop: U.S. Utilization and Movement Forecasts

Table 14: U.S. Processing-Apple Utilization: Value ($000)

2011 2012 2013 2014 2015

Total Canned $129,242 $147,908 $140,981 $113,423 $129,115 Juice $125,283 $122,887 $110,186 $89,255 $82,804 Dried $17,192 $19,624 $15,376 $13,756 $16,647 Frozen $32,321 $10,922 $27,867 $26,033 $28,249 Fresh Slices $26,434 $19,313 $36,098 $40,694 $38,139 Other Products $7,313 $6,415 $9,702 $9,846 $13,261

TOTAL1 $337,786 $327,069 $340,208 $293,006 $308,214

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary, various years. ¹ Sum of categories may not equal total due to rounding.

Table 15: U.S. Apple Utilization Summary (000 42-lb. Units)

FORECAST 2011 2012 2013 2014 2015 2016

Fresh Production 150,050 157,021 164,174 189,205 163,231 170,572 Fresh Imports¹ 8,042 10,571 11,023 9,705 9,615 9,381 Imports as % of Fresh 5% 7% 7% 5% 6% 6% Fresh Exports¹ 44,049 46,741 44,160 52,869 42,506 46,054 Exports as % of Fresh 29% 30% 27% 28% 26% 27%

Not Marketed 2,548 1,567 2,183 5,790 1,894 3,825

Total Processed² 71,807 55,514 82,014 77,176 73,064 73,940 Canned 27,112 17,831 30,105 27,024 25,833 26,048 Juice 30,438 26,479 36,186 35,243 30,331 32,314 Dried 3,655 5,310 3,833 4,071 4,262 4,303 Frozen 6,083 1,586 5,695 5,964 5,536 5,064 Fresh Slices 3,295 3,045 4,488 4,321 4,440 4,381 Other 1,690 1,257 1,705 1,674 2,662 1,830

Total Production 224,405 214,102 248,371 272,171 238,189 248,024

Source: USDA, National Agricultural Statistics Service, USApple, Noncitrus Fruits and Nuts Summary, various years - and Foreign Agricultural Service Global Agricultural Trade System (GATS) ¹ Based on a marketing year of July through June. ² Sum of categories may not equal total due to rounding.

24 U.S. Apple Association Table 16: U.S. Utilization, Movement and Storage Holdings (000 42 lb. Units)

2013 2014 2015 2016 FORECAST UTILIZATION QUANTITY % QUANTITY % QUANTITY % QUANTITY % TOTAL UTILIZATION

Fresh Exports 44,160 18% 52,869 19% 42,506 18% 46,054 19% Fresh Domestic 120,014 48% 136,337 50% 120,725 51% 124,517 50% Processing 82,014 33% 77,176 28% 73,064 31% 73,940 30% Not Marketed¹ 2,183 1% 5,790 2% 1,894 1% 3,825 2%

Total 248,371 100% 272,171 100% 238,189 100% 248,024 100%

ESTIMATED FALL MOVEMENT (BEFORE DECEMBER 1)

Fresh Exports 16,367 18,177 18,506 17,437 Fresh Domestic 41,550 41,123 38,473 39,697 Processing 38,857 30,354 31,165 32,826 Not Marketed 2,183 5,790 1,894 3,223

Total 98,957 95,445 90,037 93,183

ESTIMATED STORAGE MOVEMENT (AFTER DECEMBER 1)

Fresh Exports 27,790 34,657 24,001 33,218 Fresh Domestic 78,464 95,214 82,253 77,511 Processing 43,157 46,822 41,899 44,111

Total 149,411 176,693 148,153 154,840

MOVEMENT BY TYPE OF STORAGE

From C.A. Storage 120,732 147,485 120,732 122,324 From Regular Storage 27,907 29,188 27,421 32,516

Total Holdings on Dec 1 148,639 176,673 148,153 154,840

Processor Holdings 43,157 46,822 41,899 42,586 Fresh Holdings 106,253 129,871 106,253 112,254

Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary and USDA August 12, 2016 Crop Production. ¹ All apples not marketed are assumed to be waste or shrinkage and are accounted for in the fall period (prior to Dec. 1). Note: Totals may not add up due to rounding.

2016 Production & Utilization Analysis 25 International Market Outlook

Exports are an important factor in determining overall economic conditions in the apple industry. According to USDA’s Global Agricultural Trade System (GATS), fresh exports from the 2015 U.S. apple crop for the July 2015 to June 2016 marketing year totaled 42.5 million bushels, a 20 percent decrease from the 2014 crop. However, reflecting higher prices per unit, the value of U.S. fresh-apple exports from the 2015 crop, at $0.93 billion, was down just 14 percent from $1.08 billion the previous marketing year. In 2015, the 42.5 million bushels exported made up 26.0 percent of total fresh-market production. Exports, forecast at 46.1 million bushels in 2016-17, will represent approximately 27 percent of anticipated fresh production (See Tables 15 and 16).

According to USDA data, Mexico was the top-ranked market for U.S. apple exports from the 2015 crop. U.S. exporters shipped approximately 12.4 million bushels of apples to Mexico in 2015-16, compared to 15.6 million exported to Mexico in 2014-15. Exports to Mexico in 2015-16 represented 29 percent of all U.S. exports.

Canada represents the second-largest market for U.S. apple exports. USDA export data indicates that 7.4 million bushels were shipped to Canada from the 2015 crop, as compared to 7.6 million bushels from the 2014 crop.

Table 17: U.S. Apple Balance of Trade

2011/12 2012/13 2013/14 2014/15 2015/16 VOLUME OF FRESH 42-lb. Bushels (000) Imports 8,042 10,571 11,023 9,705 9,615 Exports 44,049 46,741 44,160 52,869 42,5062 Exports as percent of Fresh Crop 29% 30% 27% 28% 26%

Total Trade 52,091 57,312 55,183 62,574 52,121

U S. . Net 36,007 36,170 33,137 43,163 32,891

Exports as percent of total fresh trade 85% 82% 80% 84% 82% Imported Concentrate Converted to Bushels 124,433 141,426 124,193 120,459 142,687 Equivalent

TOTAL U .S . NET1 (Fresh + Concentrate) -88,426 -105,256 -91,056 -77,296 -109,796 VALUE OF FRESH ($000) Exports $987,162 $1,158,144 $1,040,195 $1,079,650 $928,5742 Imports $137,958 $197,792 $246,628 $233,185 $250,508

U S. . Net $849,204 $960,352 $793,567 $846,465 $678,066

Source: USDA, Foreign Agricultural Service. Exports and imports are based on a marketing year of July through June. ¹ Total U.S. Net = the U.S. net less the bushel equivalent of imported juice and concentrate from Table 11. 2 USDA FAS Global Agritural Trade System (GATS) Report - Fresh apple exports July 2015-June 2016.

26 U.S. Apple Association India was the third-largest export market for U.S. exporters. Exports to India totaled 2.7 million bushels from the 2015 crop, and 5.8 million bushels from the 2014 crop. The U.S-China trade agreement signed in early 2015 provided for mutual market access for fresh apples and resulted in a resumption of the export of fresh apples to China. Exports to China from the 2015 crop totaled 747 thousand bushels with a value of $18.7 million.

Table 17 details the historic balance of apple trade. Table 18 lists leading U.S. export markets. Table 19 lists the leading countries from which the United States imports fresh apples. Figure 9 illustrates yearly exports from 2011 to 2015. Figure 10 details monthly exports from 2012 to 2015. Figure 11 illustrates yearly import totals from 2011 to 2015. Figure 12 details monthly imports from 2012 to 2015. Figure 13 shows the percentage of the U.S. fresh-market crop that is exported, and Figure 14 illustrates U.S. fresh apple imports as a percentage of fresh production.

Table 18: Top Twenty Apple Export Markets (000 42-lb. Units)

CROP YEAR VALUE COUNTRY 2011 2012 2013 2014 2015 (in 000 $)

Mexico 11,253 14,071 12,094 15,642 12,358 $240,334 Canada 6,192 8,390 7,136 7,637 7,398 $189,816 India 4,804 3,077 2,770 5,833 2,672 $55,635 Taiwan 3,041 3,960 3,101 3,861 2,370 $49,259 Indonesia 3,074 2,525 1,896 1,560 2,071 $44,103 United Arab Emirates 1,506 2,011 2,837 3,030 1,926 $35,871 Hong Kong 2,707 2,300 1,886 2,289 1,763 $39,599 Vietnam 673 725 1,667 1,813 1,073 $30,593 Saudi Arabia 816 866 1,026 1,483 967 $19,434 Thailand 1,072 1,046 1,039 1,113 959 $20,294 Dominican Republic 667 688 754 936 945 $18,810 China 218 54 36 756 747 $18,656 Colombia 860 882 721 742 729 $12,520 Guatemala 474 359 466 499 565 $10,776 Costa Rica 480 369 416 450 552 $11,429 El Salvador 353 277 351 363 506 $9,147 Malaysia 725 682 715 545 390 $9,093 Philippines 336 259 345 480 384 $8,258 Israel 382 159 465 252 328 $8,292 Singapore 310 241 247 337 230 $5,546 Others 4,106 3,799 4,192 3,248 3,574 $91,109

Total Exports 44,049 46,741 44,160 52,869 42,506 $928,574

Source: USDA Global Agricultural Trade System (GATS) and U.S. Department of Commerce. Exports are based on a marketing year of July through June.

2016 Production & Utilization Analysis 27 International Market Outlook

Figure 9: U.S. Apple Exports

60,000 52,869 46,741 44,049 44,160 42,506 40,000

20,000 42 - lb. Bushels (000) 0 2011 2012 2013 2014 2015

Source: USDA Global Agricultural Trade System (GATS) and U.S. Department of Commerce.

Figure 10: U.S. Apple Exports by Month for Various Crop Years

6,000

5,000

4,000

3,000 n 2015 Crop Year n 2,000 2014 Crop Year n 2013 Crop Year n 2012 Crop Year 1,000 42 - lb. Bushels (000)

0 JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN

Source: USDA Global Agricultural Trade System (GATS) and U.S. Department of Commerce.

Figure 11: Apple Imports by year (000 42-lb. units)

12,000 11,023 11,000 10,571 10,000 9,705 9,615 9,000 8,042 8,000 7,000 42 - lb. Bushels (000) 6,000 2011 2012 2013 2014 2015

Source: USDA Global Agricultural Trade System (GATS) and U.S. Department of Commerce.

28 U.S. Apple Association 2016 U .S . Trade Outlook

Based on a U.S. 2016 crop forecast of 248.0 million bushels, USApple expects apple exports from the 2016 crop to increase to 46.1 million bushels. This would be approximately 8 percent more than the 42.5 million bushels exported in 2015-16.

Imports of fresh apples into the United States in 2016-17 are forecast by USApple at 9.4 million 42 lb. bushels, a 2 percent decrease from 2015.

Table 19: Apple Imports by Country and Year (000 42-lb. units)

COUNTRY 2011 2012 2013 2014 2015 Chile 5,033 7,201 6,906 5,226 5,267 New Zealand 1,631 2,044 1,195 1,794 2,214 Canada 1,085 953 2,443 1,942 1,340 Argentina 278 373 430 705 643 China 0 0 0 1 116 Others 15 1 50 36 35

Total Imports 8,042 10,571 11,023 9,705 9,615

Source: USDA Global Agricultural Trade System (GATS) and U.S. Department of Commerce Imports are based on a marketing year of July through June.

Figure 12: Apple Imports by Month for Various Crop Years

3,500

3,000 n 2015 Crop Year 2,500 n 2014 Crop Year 2,000 n 2013 Crop Year 1,500 n 2012 Crop Year 1,000

42 - lb. Bushels (000) 500

0 JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN

Source: USDA Global Agricultural Trade System (GATS) and U.S. Department of Commerce.

2016 Production & Utilization Analysis 29 International Market Outlook

European Crop Outlook

Production in the European Union’s apple-growing countries is forecast at 12.0 million metric tons (630 million bushels) for the 2016 season. This information was developed by the World Apple and Pear Association (WAPA) in conjunction with the Prognosfruit Conference in Hamburg, Germany from August 3-5, 2016.

The 2016 European forecast is 3 percent lower than 2015, when production was 12.3 million metric tons (647 million bushels). The projected 2016 crop is 6 percent above the five-year average. Apple production for all 28 members of the European Union is reported together.

Table 20: European Union Apple Production, By Country (000 Metric Tons)

2016 5-YEAR CHANGE FROM 2011 2012 2013 2014 2015 FORECAST AVERAGE 2015 5-YR AVG .

Poland 2,500 2,900 3,170 3,750 3,979 4,150 3,260 +4% +27% Italy 2,293 1,939 2,122 2,456 2,280 2,282 2,218 +0% +3% France 1,701 1,169 1,576 1,444 1,674 1,564 1,513 -7% +3% Germany 953 972 804 1,116 973 1,052 964 +8% +9% Spain 507 391 464 505 482 509 470 +6% +8% Hungary 301 750 585 920 522 449 616 -14% -27% Romania 412 351 387 382 336 371 374 +10% -1% Netherlands 418 281 314 353 336 332 340 -1% -2% Portugal 265 221 284 272 329 263 274 -20% -4% Greece 305 242 236 245 242 263 254 +9% +4% United Kingdom 226 162 204 225 243 250 212 +3% +18% Belgium 305 220 220 318 285 234 270 -18% -13% Czech Rep 79 118 121 131 156 113 121 -28% -7% Lithuania 49 39 40 27 46 38 40 -17% -5% Croatia 83 59 96 62 101 35 80 -65% -56% Austria 199 157 155 188 177 22 175 -88% -87% Denmark 20 18 23 26 24 22 22 -8% -1% Sweden 17 14 17 16 21 20 17 -5% +18% Slovakia 33 36 42 46 40 17 39 -58% -57% Slovenia 73 45 56 68 71 12 63 -83% -81% Latvia 8 9 15 10 8 8 10 +0% -20%

TOTAL 10,746 10,093 10,929 12,560 12,325 12,005 11,331 -3% 6%

Source: WAPA. Note: Sum of country totals may not add to total due to rounding.

30 U.S. Apple Association Among the largest producers, Polish production is forecast to increase by 4 percent over its 2015 produc- tion, while Italian production is forecast to remain steady. French production is expected to be down by 7 percent, and German production is forecast to increase by 8 percent in 2016. Production in Spain is expected to rise by 6 percent from last year’s crop, while production in Hungary is forecast to decrease by 14 percent. Apple production in the Netherlands is expected to decrease by 1 percent, while Belgium production is expected to fall by 18 percent.

Table 21: European Union Apple Production, By Variety (000 Metric Tons)

2016 5-YEAR CHANGE FROM 2011 2012 2013 2014 2015 FORECAST AVERAGE 2015 5-YR AVG .

Golden Delicious 2,628 2,286 2,535 2,677 2,534 2,364 2,532 -7% -7% Gala 1,137 1,111 1,204 1,328 1,382 1,329 1,232 -4% +8% Idared 692 986 1,069 1,192 1,129 1,064 1,014 -6% +5% Red Delicious 680 541 597 675 643 633 627 -2% +1% Jonagold 652 475 500 644 633 565 581 -11% -3% Shampion 327 423 457 494 513 520 443 +1% +17% Jonagored 194 367 341 491 519 535 382 +3% +40% 453 353 346 431 399 394 396 -1% -1% Granny Smith 413 302 361 383 405 390 373 -4% +5% Braeburn 324 264 302 321 312 322 305 +3% +6% Fuji 261 212 311 321 338 309 289 -9% +7% Cripps Pink 184 144 187 249 244 260 202 +7% +29% Gloster 148 187 196 201 183 193 183 +5% +5% Jonathan 242 201 178 193 143 123 191 -14% -36% Grise 108 73 121 126 134 120 112 -10% +7% Red Jonaprince 33 48 53 98 104 159 67 +53% +137% Bramley 91 59 70 83 84 85 77 +1% +10% Boskoop 73 58 58 85 92 71 73 -23% -3% 37 43 62 79 100 90 64 -10% +40% Morgenduft 61 53 57 74 46 66 58 +43% +13% 35 35 35 40 35 35 36 +0% -3% Cox Orange 89 38 42 32 34 29 47 -15% -38% Lobo 100 50 30 30 31 0 48 -100% -100% Cortland 70 40 25 25 26 0 37 -100% -100% Stayman 17 12 18 14 14 14 15 +0% -7% 6 6 6 6 6 4 6 -33% -33% Other 1,541 1,377 1,358 1,809 1,776 1,802 1,572 +1% +15% Other New Varieties 152 350 412 459 465 530 395 +14% +34%

TOTAL 10,746 10,095 10,929 12,560 12,325 12,005 11,331 -3% +6%

Source: WAPA. Note: Column totals reflect EU production as listed in Table 20.

2016 Production & Utilization Analysis 31 International Market Outlook

In terms of varieties, European production of that region’s most prevalent variety, Golden Delicious, is forecast at 2.4 million metric tons (124 million bushels), a 7 percent decrease from 2015, and 7 percent less than the average production over the last five years. Gala, now the second largest variety produced in Europe, is expected to yield 1.3 million metric tons (70 million bushels) in 2016. European Gala produc- tion is expected to be 4 percent below 2015, but 8 percent above the five-year average. Red Delicious,

Table 22: Other European and Perimeter Countries Apple Production, By Country (000 Metric Tons)

2016 5-YEAR CHANGE FROM 2011 2012 2013 2014 2015 FORECAST AVERAGE 2015 5-YR AVG .

Belarus 180 171 145 160 155 155 162 0% -4% Bosnia-Herzegovin 75 50 85 61 69 28 68 -59% -59% China 35,985 38,500 39,683 40,923 43,112 43,000 39,641 0% 8% Macedonia 128 127 113 85 70 0 105 -100% -100% Mexico 631 375 522 350 717 600 519 -16% 16% Moldova 269 282 260 420 250 300 296 20% 1% Norway 5 6 7 8 5 8 6 60% 29% Russia 1,036 1,258 1,470 1,647 1,707 1,736 1,424 2% 22% Serbia 266 179 332 317 356 400 290 12% 38% Switzerland 155 141 132 143 140 134 142 -4% -6% Turkey 2,432 2,445 2,681 2,109 2,466 2,851 2,427 16% 17% Ukraine 954 1,127 1,211 1,082 1,196 1,209 1,114 1% 9%

TOTAL 42,116 44,661 46,641 47,305 50,243 50,421 46,641 0% 8%

Source: WAPA. Note: Sum of country totals may not add to total due to rounding. NC = Change of less than one percent.

Table 23: Canadian Apple Production, by Province (000 42-lb. Units)

2016 5-YEAR CHANGE FROM PROVINCE 2011 2012 2013 2014 2015 FORECAST AVERAGE 2015 5-YR AVG .

Ontario 9,796 7,622 8,567 7,315 4,499 7,071 7,560 +57% -6% Quebec 5,404 5,543 5,786 5,804 5,837 5,596 5,675 -4% -1% British Columbia 3,579 4,502 4,439 3,928 2,714 2,922 3,832 +8% -24% Nova Scotia 2,350 2,282 2,030 2,100 1,340 1,297 2,020 -3% -36% New Brunswick 144 173 173 167 167 167 165 +0% +2%

Total 21,273 20,122 20,995 19,302 14,557 17,054 19,250 +17% -11%

Source: The Ontario Ministry of Agriculture and Rural Affairs, Federation des Producteurs de Pommes du Quebec, New Brunswick Apple Marketing Board and Nova Scotia Fruit Growers Association. British Columbia data are adjusted BC Tree Fruit Estimates.

32 U.S. Apple Association the fourth most popular European variety, is forecast at 633,000 metric tons (33 million bushels) and is expected to decrease by 2 percent from last year but will be 1 percent above the five-year average. Jonagold production, forecast at 565,000 metric tons (30 million bushels), is down 11 percent from last year and 3 percent below the five-year average.

Table 20 shows historical European production by country, while Table 21 denotes historical European production by variety. Table 22 shows production in other European and perimeter countries which are not members of the EU.

Table 24: Canadian Apple Production, By Variety (000 42-lb. Units)

British Columbia Ontario Quebec New Brunswick Nova Scotia Canadian Total 2015 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015 2016

McIntosh 250 233 1,056 1,756 3,523 3,233 89 89 240 200 5,158 5,512 Gala 1,192 1,319 394 637 171 188 0 0 40 50 1,797 2,194 Empire 0 0 446 1,221 301 310 0 0 5 12 752 1,543 Honeycrisp™ 27 33 570 609 110 117 0 0 300 325 1,007 1,084 Spartan 338 345 170 163 473 481 0 0 5 0 986 989 546 633 81 235 0 0 0 0 30 60 657 928 Cortland 0 0 135 189 518 544 48 48 110 125 811 906 Spy 0 0 829 625 0 0 0 0 300 260 1,129 885 Red Delicious 158 142 286 587 0 0 0 0 50 50 494 779 Idared 0 0 127 334 0 0 0 0 115 100 242 434 Golden Delicious 46 38 139 204 0 0 0 0 45 40 230 282 0 0 0 0 250 250 0 0 0 0 250 250 Fuji 26 37 32 51 0 0 0 0 0 0 58 88 Granny Smith 67 71 0 0 0 0 0 0 0 0 67 71 Crispin/ 0 0 34 60 0 0 0 0 0 0 34 60 Jonagold 0 0 0 0 0 0 0 0 70 55 70 55 Pink Lady 18 25 0 0 0 0 0 0 0 0 18 25 0 0 0 0 0 0 0 0 0 0 0 0 Braeburn 0 0 0 0 0 0 0 0 0 0 0 0 Others 47 46 200 400 491 473 30 30 30 20 798 969

Total 2,714 2,922 4,499 7,071 5,837 5,596 167 167 1,340 1,297 14,557 17,054

Source: The Ontario Ministry of Agriculture and Rural Affairs, Federation des Producteurs de Pommes du Quebec, New Brunswick Apple Marketing Board, and Nova Scotia Fruit Growers Association. British Columbia data are adjusted BC Tree Fruit estimates. Data for all provinces include processing apples in each variety estimate. Note: Columns may not add up to total due to rounding.

2016 Production & Utilization Analysis 33 International Market Outlook

Canadian Crop Outlook

Total Canadian apple production for the 2016 crop is forecast at 17.1 million bushels, up 17 percent from the weather damaged 2015 crop. Compared to the five-year average, 2016 production is expected to decline by 11 percent. Ontario production is slated to increase by 57 percent to 7.1 million bushels in 2016, which is 6 percent below the five-year average. British Columbia production is expected to increase to 3 million bushels in 2016, which is 24 percent below the five-year average. Quebec production is forecast at 5.6 million bushels in 2016, down 4 percent from2015, and down 1 percent from the five-year average. Nova Scotia production is estimated at 1.3 million bushels, down 3 percent from 2015, and 36 percent below the five-year average. In New Brunswick, production is expected at 167,400 bushels, steady with 2015 production, and up 2 percent from the five-year average.

Varietal production in Canada is dominated by McIntosh, which makes up approximately 32 percent of total Canadian apple production. The 2016 McIntosh crop in Canada is forecast to increase by 7 percent from the 2015 crop. Gala, the second-most widely grown variety this year, is up 22 percent from 2015 production levels. Red Delicious has fallen to ninth place, but production is expected increase by 58 percent from 2015. The forecast for other important varieties in 2016 compared to 2015 follows: Empire up 105 percent, Spartan steady with 2015, Idared up79 percent, and Cortland up 12 percent.

Table 23 shows historical Canadian apple production by province, and Table 24 shows Canadian apple production by variety.

Figure 13: U.S. Fresh Apple Exports as Percent of Fresh Production

29.8% 30% 29.4% 28.2% 26.9% 26.0%

25% 23.8%

20% 42 - lb. Bushels (000)

15% 2010 2011 2012 2013 2014 2015

Source: USDA Global Agricultural Trade System (GATS) and U.S. Department of Commerce Marketing year is July through June.

34 U.S. Apple Association Figure 14: U.S. Fresh Apple Imports as Percent of Fresh Production

10%

9%

8% 6.7% 6.7% 7% 6.2% 5.9% 6% 5.4% 5.2%

42 - lb. Bushels (000) 5%

4%

3% 2010 2011 2012 2013 2014 2015

Source: USDA Global Agricultural Trade System (GATS) and U.S. Department of Commerce Marketing year is July through June.

Table 25: USDA Apple Purchases for Various Years

TOTAL COST (000’S) COMMODITY TYPE FY 2012 FY 2013 FY 2014 FY 2015 FY 2016* Apple Juice $14,725 $10,988 $12,008 $11,751 $7,511 Applesauce $22,981 $34,223 $40,011 $44,095 $26,643 Kosher Canned Applesauce $145 $125 $98 $112 $92 Apple Slices, Canned $3,287 $4,696 $4,574 $4,430 $2,379 Apple Slices, Frozen $4,712 $6,388 $6,288 $3,573 $1,225 Apples, Fresh $694 $3,771 $1,875 $11,768 $0 Apples Fresh Cut $725 $0 $0 $0 $0 Fresh for Further Processing $980 $858 $3,505 $8,430 $827

FY Total* $48,249 $61,049 $68,359 $84,159 $39,165

Source: USDA, Agricultural Marketing Service (AMS) Fruit and Vegetable Division. Fiscal Year from October 1-September 30. *FY2015 data represents purchases thru July 1, 2016 - FY ends on September 30, 2016.

2016 Production & Utilization Analysis 35 Appendix A

Monthly Apple-Juice Concentrate Price Ranges, 2001 - 2016 ($US per Gallon 70 Brix)

2001 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY 5.25 5.00 5.00 5.25 4.75 4.35 4.25 4.25 4.50 4.50 4.50 4.50 5.50 5.25 5.25 5.50 5.25 5.00 5.00 5.00 5.00 4.75 4.75 4.75

South American, Ex-Dock, NY 5.00 4.50 4.50 4.25 4.00 4.00 4.00 4.00 4.00 4.25 4.25 4.50 5.50 4.75 4.75 4.50 4.50 4.25 4.25 4.25 4.25 4.50 4.50 4.75

Chinese, Ex-Dock, NY 5.00 4.50 4.50 4.00 3.75 3.75 4.00 4.00 4.25 4.25 4.25 5.25 4.75 4.75 4.25 4.00 4.25 4.25 4.25 4.50 4.50 4.75

U.S.A. FOB, Northwest 5.00 4.50 4.50 4.25 4.00 4.00 4.00 4.00 4.00 4.25 4.25 4.50 5.25 5.00 4.75 4.50 4.50 4.25 4.25 4.25 4.25 4.50 4.50 4.75

2002 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY 4.50 4.50 4.50 4.50 4.50 4.45 4.45 4.50 4.50 4.50 4.55 4.55 4.75 N/A N/A 4.75 4.75 4.75 4.75 4.75 4.75 5.00 4.80 4.95

South American, Ex-Dock, NY 4.50 4.20 4.25 4.25 4.25 4.35 4.35 4.25 4.25 4.40 4.40 4.40 4.75 4.50 4.55 4.55 4.55 4.55 4.75 4.75 4.75 4.80 4.85 4.85

Chinese, Ex-Dock, NY 4.25 4.00 4.00 4.00 4.00 4.00 4.25 4.00 4.00 4.25 4.25 4.25 4.75 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.75 4.65 4.50

U.S.A. FOB, Northwest 4.50 4.25 4.25 4.20 4.20 4.20 4.50 4.50 4.50 4.50 4.50 4.50 4.75 4.75 4.75 4.75 4.75 4.75 4.75 4.75 4.75 5.00 5.00 5.25

2003 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY 4.55 4.50 4.50 5.00 5.00 4.85 5.50 5.75 5.75 6.25 6.25 6.25 4.95 5.25 5.25 5.25 5.25 5.45 6.00 6.00 6.50 6.50 6.85 6.85

South American, Ex-Dock, NY 4.40 4.40 4.40 4.50 4.50 4.50 4.70 4.70 N/A N/A N/A N/A 4.85 4.80 4.80 4.80 4.85 4.85 4.95 4.95 N/A N/A N/A N/A

Chinese, Ex-Dock, NY 4.10 4.10 4.25 4.25 3.85 4.00 4.00 4.10 4.00 4.00 4.25 4.25 4.50 4.25 4.80 4.60 4.10 4.25 4.55 4.25 4.50 4.75 4.75 4.75

U.S.A. FOB, Northwest 4.50 4.50 4.50 4.75 4.50 4.50 4.50 4.75 4.75 5.50 5.50 5.50 5.25 5.25 5.25 5.25 5.25 5.00 5.00 5.50 5.50 6.00 6.00 6.00

2004 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.25 6.75 6.75 6.75 6.75 6.75 6.75 6.75 6.75 6.75 7.00 7.00 6.85

South American, Ex-Dock, NY N/A N/A N/A N/A N/A 5.50 5.50 5.50 5.50 5.25 5.25 5.25 N/A N/A N/A N/A N/A 6.00 6.00 6.00 6.00 5.50 5.50 5.50

Chinese, Ex-Dock, NY 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.50 3.95 3.95 4.00 4.75 4.75 4.75 4.75 4.75 4.75 4.75 4.75 5.00 4.70 4.70 4.75

U.S.A. FOB, Northwest 5.50 5.50 5.50 5.50 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00

Source: The Food Institute ¹ Apple juice concentrate prices are segregated by country of origin. ² N/A indicates that data is unavailable.

36 U.S. Apple Association Monthly Apple-Juice Concentrate Price Ranges, 2001 - 2016 (cont’d)

2005 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY 6.25 6.25 6.25 6.25 6.25 6.50 6.50 6.50 7.00 8.25 8.25 8.25 6.85 6.85 6.85 6.85 6.85 7.00 7.00 7.00 8.50 8.50 8.50 8.50

South American, Ex-Dock, NY 5.25 5.25 5.25 5.25 5.25 5.00 5.00 5.00 4.50 4.50 4.50 5.00 5.50 5.50 5.50 5.50 5.50 5.25 5.25 5.25 4.75 4.75 5.00 5.75

Chinese, Ex-Dock, NY 4.00 4.00 4.00 4.50 4.50 4.25 4.25 4.25 3.75 5.00 5.00 5.25 4.75 4.75 4.75 5.00 5.00 4.75 4.75 4.75 4.50 5.15 5.25 5.75

U.S.A. FOB, Northwest 5.00 5.00 5.00 5.00 5.00 4.75 4.75 4.75 4.50 5.00 5.00 5.00 5.50 5.50 5.50 5.50 5.50 5.25 5.25 5.25 5.25 5.50 5.50 5.50

2006 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY 8.25 N/A N/A N/A N/A N/A N/A N/A N/A 7.50 8.00 7.00 8.50 N/A N/A N/A N/A N/A N/A N/A N/A 8.00 9.00

South American, Ex-Dock, NY 5.10 5.40 5.40 5.45 5.60 5.60 5.60 5.60 5.75 N/A N/A 6.00 5.25 5.85 5.85 5.85 5.75 5.75 5.75 5.75 5.85 N/A N/A 6.20

Chinese, Ex-Dock, NY 5.50 5.50 5.50 5.50 N/A N/A N/A N/A N/A 6.10 6.10 5.80 6.00 6.00 6.00 6.00 N/A N/A N/A N/A N/A 6.70 6.70 6.00

U.S.A. FOB, Northwest 5.25 5.25 6.10 5.50 6.00 6.00 6.00 6.00 6.25 6.50 6.50 6.00 5.75 5.75 6.50 6.00 6.45 6.45 6.45 6.45 6.50 6.75 6.75 6.20

2007 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY 7.00 N/A N/A 7.25 7.00 7.25 N/A 15.00 15.00 15.00 15.00 16.00 16.00 16.00 16.00 16.00 17.00

South American, Ex-Dock, NY 6.00 6.15 6.30 6.30 6.25 6.25 N/A N/A N/A N/A N/A N/A 6.20 6.35 6.50 6.50 N/A N/A N/A N/A N/A N/A

Chinese, Ex-Dock, NY 5.80 6.05 6.25 6.25 6.25 6.00 N/A 9.00 9.50 9.50 9.50 10.00 6.00 6.25 6.50 6.50 N/A 10.00 10.00 10.50 10.50

U.S.A. FOB, Northwest 6.00 5.25 5.25 6.00 6.00 6.00 6.00 N/A 6.25 6.25 6.25 6.25 6.20 5.50 5.50

2008 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

South American, Ex-Dock, NY N/A N/A N/A 11.00 11.00 10.50 10.00 10.00 7.50 6.50 6.00 6.00 N/A N/A N/A 11.00 11.00 11.50 8.00 6.75 6.25 6.25

Chinese, Ex-Dock, NY 9.50 10.00 9.50 10.00 10.00 10.50 10.50 9.50 6.50 6.00 5.00 5.00 10.50 10.00 7.00 6.25 5.25 5.25

U.S.A. FOB, Northwest 10.00 10.50 10.50 11.00 12.50 12.00 11.50 11.50 N/A N/A N/A N/A 11.00 11.00 11.50 13.50 13.00 12.00 12.00 N/A N/A N/A N/A

Source: The Food Institute ¹ Apple juice concentrate prices are segregated by country of origin. ² N/A indicates that data is unavailable.

2016 Production & Utilization Analysis 37 Appendix A

Monthly Apple-Juice Concentrate Price Ranges, 2001 - 2016 (cont’d)

2009 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY N/A N/A N/A N/A 8.00 8.00 8.00 8.00 8.00 8.00 N/A N/A

South American, Ex-Dock, NY 6.00 6.00 5.00 5.00 5.00 5.25 5.25 5.25 5.25 5.25 5.25 5.25 6.25 6.25 5.25 5.25 5.25 5.50 5.50 5.50 5.50 5.50 5.50 5.50

Chinese, Ex-Dock, NY 4.00 4.20 4.20 4.20 4.20 4.50 4.50 5.00 4.75 4.75 5.00 5.25 4.40 4.25 4.25 4.25 4.25 5.00 5.00 5.00 5.00 5.00 5.25 5.50

U.S.A. FOB, Northwest N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

2010 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

South American, Ex-Dock, NY 5.25 N/A N/A 6.00 6.00 6.00 6.00 6.00 6.00 N/A N/A 11.00 5.50 N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 11.25

Chinese, Ex-Dock, NY 5.25 5.30 5.30 5.40 5.40 5.45 5.50 5.50 5.80 8.75 9.50 11.00 5.50 5.50 5.50 5.55 5.55 5.50 5.75 5.75 5.85 N/A 10.00 11.60

U.S.A. FOB, Northwest N/A N/A N/A N/A N/A 6.50 6.50 7.50 7.50 N/A N/A N/A

2011 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

South American, Ex-Dock, NY N/A N/A 10.50 10.50 10.50 10.50 10.00 10.00 10 9.5 N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

Chinese, Ex-Dock, NY 10.50 10.50 10.60 10.60 10.90 10.50 10.25 10.25 10.25 10.50 12.25 12.25 11.50 11.50 10.95 10.95 11.00 10.50 10.50 10.50 11.50

U.S.A. FOB, Northwest N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

2012 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

South American, Ex-Dock, NY N/A N/A N/A 10.85 N/A N/A N/A N/A N/A 8.93 8.93 N/A N/A N/A N/A N/A N/A N/A N/A

Chinese, Ex-Dock, NY 12.00 11.25 10.50 10.50 10.25 10.25 10.00- 10.00- 9.85 9.85 9.85 9.45 12.00 10.50 10.50 10.50 10.50

U.S.A. FOB, Northwest N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

Source: The Food Institute ¹ Apple juice concentrate prices are segregated by country of origin. ² N/A indicates that data is unavailable.

38 U.S. Apple Association Monthly Apple-Juice Concentrate Price Ranges, 2001 - 2016 (cont’d)

2013 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

South American, Ex-Dock, NY N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

Chinese, Ex-Dock, NY 8.75 8.75 7.00 7.00 7.00 8.00 8.00 8.00 8.00 8.00 8.50 8.50

U.S.A. FOB, Northwest N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 9.00 9.00

2014 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY N/A N/A N/A N/A N/A 7.85 7.95 7.99 7.5 6.75 6.75 7

South American, Ex-Dock, NY N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

Chinese, Ex-Dock, NY 8.50 8.50 8.00 8.00 7.63 7.40 7.55 7.55 7.50 7.40 7.40 7.40

U.S.A. FOB, Northwest 8.50 8.50 8.25 8.25 7.38 7.38 N/A N/A N/A $7..00 7.00 7.00

2015 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.50 8.00 8.00 8.00

South American, Ex-Dock, NY N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

Chinese, Ex-Dock, NY 6.95 6.95 6.75 6.75 6.50 6.50 6.50 6.10 6.10 6.75 6.75 6.75

U.S.A. FOB, Northwest 6.95 6.95 6.95 6.95 6.95 6.75 6.75 6.75 6.75 7.00 7.00 7.00

2016 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC European, Ex-Dock, NY 8.00 8.00 7.00 7.00 7.00 7.00

South American, Ex-Dock, NY N/A N/A 6.25 6.25 6.00 6.00

Chinese, Ex-Dock, NY 6.50 6.25 6.00 6.00 5.80 5.80

U.S.A. FOB, Northwest 7.00 7.00 7.00 7.00 7.00 7.00

Source: The Food Institute ¹ Apple juice concentrate prices are segregated by country of origin. ² N/A indicates that data is unavailable.

2016 Production & Utilization Analysis 39 Appendix A

Monthly Apple-Juice Concentrate Prices 2001 - 2016

APR

JAN – 16 – JAN

OCT

JUL

APR

JAN – 15 – JAN

OCT

JUL

APR

JAN – 14 – JAN

OCT

JUL

APR

JAN – 13 – JAN

OCT

JUL

APR

JAN – 12 – JAN

OCT

JUL

APR

JAN – 11 – JAN

OCT

JUL

APR

JAN – 10 – JAN

OCT

JUL

APR

JAN – 09 – JAN

OCT

JUL

APR

JAN – 08 – JAN

OCT

JUL

APR

JAN – 07 – JAN

OCT

JUL

APR

JAN – 06 – JAN

OCT

JUL

APR

JAN – 05 – JAN

OCT

JUL

APR

JAN – 04 – JAN

OCT

JUL

APR

JAN – 03 – JAN

OCT

JUL

APR

JAN – 02 – JAN

OCT

JUL

APR JAN – 01 – JAN $9.00 $6.00 $3.00

$15.00 $12.00 $US per 70 Brix Gallon Brix 70 per $US Source: The Food Institute, Fair Lawn N.J., Bureau of Census.

40 U.S. Apple Association Notes U.S. Apple Association 8233 Old Courthouse Rd., Ste. 200 Vienna, Va. 22182 703.442.8850 USApple.org