More than 2m cartons in just one week: that was the staggering volume of cherries that Asian markets imported from Chile in the heat of the 2010/11 campaign, according to latest analysis from Chilean fresh fruit consultancy iQonsulting.
It’s a remarkable statistic in a record season that saw overall Chilean cherry exports to Asia double to hit 28,877 tonnes. That figure represented close to half of Chile’s total cherry exports and consolidated Asia’s position as the industry’s largest market ahead of the US and Europe.
Hong Kong/China was the vacuum drawing in such big volumes, accounting for 85 per cent of the fruit taken in that 2m-carton week alone.
And that dominance over Chilean cherry exports to Asia is mirrored by full-season figures, which reveal that Hong Kong doubled its intake to 15,618 tonnes, while China’s shot up by 116 per cent to 8,146 tonnes. The two markets combined accounted for more than 82 per cent of exports to the region. Taiwan was the third key Asian market, increasing its imports by 70 per cent to 4,374 tonnes.
The timing of that 2m-carton week was also significant, coming in the third week of January in time for arrivals to be sold during Chinese New Year festivities on 3 February.
“Chilean cherries are valued by Asian markets and particularly by the Chinese market where they have become a big part of marking their main festival, Chinese New Year,” explained Isabel Quiroz, managing director of iQonsulting.
“Chinese marketers and Chilean exporters both understand that this is a special time of celebration and the fruit is very well suited to the requirements of consumers. It’s a very attractive fruit – red, round, shiny and very sweet – and it matches the colours of the festival.”
While China’s strong festive demand for cherries during the Chilean season was a key factor behind the surge in shipments in 2010/11, Ms Quiroz emphasised that it was more than just a case of favourable timing. In particular, the large volumes reflect the Chilean industry’s assiduous efforts to develop seafreight of cherries to these distant destinations.
“In technical terms, the increase is principally due to the ability to reach this market with fruit of optimum quality using marine transportation,” she told Fruitnet.com. “This is thanks to an efficient type of modified atmosphere bag that has been developed in Chile to allow cherries to be transported for 30 days by boat and arrive in excellent condition.”
Despite the advances in packing and shipping, it’s not all been plain sailing for Chilean cherry exports to Asia, however. Unsurprisingly with such hefty volumes and so many players involved, the market experienced some fluctuations, a factor also reflected by the varying market prices and grower returns.
“Prices opened at around US$120 per 5kg carton (Free On Truck/importer’s price) but rapidly dropped to around US$50-60 per 5kg carton as more product became available,” said Ms Quiroz. “The lowest prices were around US$40 per carton. You have to take into account the fact that some cargoes experienced problems on arrival, so normally you need to repack, decreasing returns for the producer-exporter due to the rise in costs and the loss of fruit.”
A key issue behind those shipments that faced quality issues this year was unsuitable varieties, according to Ms Quiroz. “There are problems with some varieties that have not adapted well to the long journeys,” she said. “Some of them arrived with quality problems, disappointing importers and resulting in a loss as they had to be either repacked or sold cheaper.”
On the whole though, Ms Quiroz noted that the technical efforts of the Chilean industry, both in terms of production and transportation, have proven successful in landing product in Asia in optimum condition. And she believes the future for Chilean cherry exports to China and other markets remains very promising.
“Chile can produce fruit for this market that is large in size with good shelf life and an attractive colour, shape and taste,” she said. “Moreover, we’ve recently developed more attractive packaging that is targeted at the consumer. This is available in 1kg, 1.5kg, 2kg and 2.5kg cartons, and it demonstrates the value this fruit has to the consumer.”
The timing of the Chilean season is also favourable in that it enables exporters to deliver large volumes for special events such as Christmas, New Year and Chinese New Year, she added. “Of course, there is competition from other suppliers, but Chile has adapted controlled atmosphere and modified atmosphere technology for use on cherries to great effect, achieving greater competitiveness for its offer,” Ms Quiroz underlined.
Above all, demand from the Chinese market in particular is still growing, spurred on by its booming economy. “The question is: how long can that demand keep growing?” she said. “Although it’s difficult to predict what will happen in the Chinese market, we can say that in the medium term, say five years, the demand will continue to grow.”
This article is an abridged version of a report that appears in the 2011 edition of Trade Latin America. To order your copy of Trade Latin America, email to subscriptions@fruitnet.com
