China’s apple production is increasing in its Western provinces. Apple production is shifting to new areas as grain and vegetable production has proven more profitable for producers in higher rainfall areas.

Five years ago in China’s Shaanxi province, the area around its capital city Xi’an, was dense with apple orchards. Today orchards are rare. Trees were replaced by wheat fields when producers responded to government incentives to increase grain production. Some of this apple production began to shift to the Northern parts of the province, which is essentially a high plateau with limited rainfall and little irrigation. However, the high altitude and cold nights produce high quality apples, has fewer pests, and while yield per acre for apples is much lower costs are much lower too.

Apple juice processing plants in central Shaanxi that once had an abundance of juice apples found they had to pay much higher prices for juice apples – over $100 per ton in 2006. In the Northern part of the province there is only one apple juice concentrate plant.

Producers in the high plateau area of Shaanxi are continuing to increase their plantings of apple trees in response to improved apple prices and small government incentives. This area is very rural but income per capita is improving. There are some new homes in villages but very few. Many homes are still built into hillsides and apples are stored in underground rooms. Farmers accumulate livestock manure in pits and then collect the methane for gas for cooking. The remaining waste is then used for fertilizer in the orchards.

Most homes are heated by coal, and cooking is done by burning cornstalks or other crop residue. Beds are designed with a small oven like enclosure under them to provide heat from coal embers throughout the night. The same cool summer nights that improve the quality of apples also make life hard in the winter for many farmers.

Most apple producers farm between 10-15 mu (1.6-2.5 acres) of apple orchards and currently about a third of it is in new plantings. Fuji is still the dominate variety although Galas are becoming more popular. Most orchards are low density plantings, do not use dwarfing rootstocks and are not irrigated. There are several government demonstration farms that have some irrigation and higher density plantings, but most focus on teaching producers better management practices and introducing new technology. Some researchers have experimented with dwarfing rootstock and other root systems, but have found that yields and quality are better with full sized trees. Other researchers have shown dwarfing rootstock and high density orchards consistently produce higher quality fruit and more profits, but take much more management skill.

In 2006 apple producers in Shaanxi received 3-4 Yuan per kilogram (about $.20 per pound) for good quality apples and about 1 Yuan per kilogram (about $117 per ton) for juice apples. These prices are somewhat higher than the previous year despite a large crop and are primarily due to a growing demand for fresh fruit and juice by Chinese consumers.

In an informal survey of apple producers, Chinese horticulturalists have found approximately one third of apple producers in Shaanxi province lose money, one third break even and one third make money. They indicated the determining factors are the farmers’ management abilities, and their willingness to adopt improved production methods along with good agricultural practices.

Unfortunately, it appears in some cases the old adage that if a little is good a lot must be better is the standard. While this philosophy is good for many things, with chemicals and fertilizer it creates residue and environmental issues for the farmer and sometimes for neighbors.

Producers who have planted high density orchards will significantly increase production, and because of improved management they will likely improve the overall quality of their apples. Early projections for 2007 by producers suggest a large crop, similar to last year. However, horticultural researchers suggested the total crop in China will be about 20 million metric tons, down by 20 percent compared to 2006, and that Shaanxi production will fall to 5 million metric tons, down 30 percent from 2006, which is based upon their assessment of early conditions.

Chinese apple production is beginning to shift production to areas that have more of a comparative advantage in producing higher quality apples although yields are currently less. However adoption of better technology and production practices will improve yields in the future. Overall, increased production must be balanced against growing demand by Chinese consumers with growing incomes.