Israel stands as a well-established source of summer lines, starting with grapes and stonefruit and moving on to more exotic lines including mangoes, pomegranates, dates and dragon fruit, all of which can command a premium in the UK.
The economic downturn may have hit the global trade of fruit and vegetables, but it has not stopped Israeli growers and exporters from building on their links with UK buyers. Even with sterling having weakened against the Israeli shekel, sendings to the UK remain on track across almost all lines.
The varied basket of products coming on stream in the next few weeks is a good indication of how growers and exporters must juggle their offer throughout the summer.
Israeli exporting giant Agrexco sends a wide range of summer lines to the UK, including its most popular line, mangoes, as well as plums, grapes and figs, alongside the likes of passionfruit, lychees and dragon fruit.
Agrexco UK managing director Oded Yacovson is optimistic about the start of summer supply. “At the moment, we are in the transition between winter and summer lines, which will start next week,” he says. “I am feeling positive because I have a hunch that everything is moving in the right direction.”
First up, the Israeli grape season is halfway through and Early Sweet finished last week, with Agrexco having sent 1,500 tonnes to the UK, before Thompson takes up the baton in July and August.
Stonefruit sendings will kick off the summer arrivals in volume next week, two weeks later than usual because the weather in the production phase held back supply. The plums, grown mainly in the Galilee area and in northern regions near the border with Lebanon, are expected to be top quality and overall volumes are set to be in line with last year, with 3,000t produced by Agrexco growers and more than 90 per cent earmarked for the UK.
Lychee supply will build over the next few weeks, with the first pallets being flown to the UK this week, before seafreight kicks in until the end of August. However, Agrexco’s exports to the UK will not exceed 300t this year.
Mangoes will follow next month, when they will come into their own as the main summer line. This year, Agrexco will produce some 7,000t and around half will be sent to the UK until September or October. So far, all indications are that growers are looking forward to a bigger crop, thanks to it being an on-season. The ready-to-eat Maya and Shelley varieties are expected to have a good run, gaining in volume as a result of the increasing switch from Tommy Atkins in the last three or four years.
“Mangoes will be the ones to watch this year,” says Yacovson. “The quality is looking very good on Shelley and Maya, as well as early-season Tommy Atkins, which is still being supplied to the UK.”
Pomegranates start at the end of July with Rosh Pered, before moving into Akko and Shani in mid-August and on to Wonderful in September. The production areas increased by 250 hectares last year and a further 350ha this year, ahead of another 300ha that will come on stream in 2010. Some 7,000t will be produced by Agrexco growers this year and around a third will be sent to the UK. The market for prepared pomegranate arils is growing in the UK, but Israeli growers and exporters will have to compete with cheaper product from India to make this sustainable.
Israeli fig production is on the up this year, with growers harvesting an extra 10ha of Turkish variety Is Bursa on top of main variety Brown Turkey. Across all lines, around 200t will be sent to the UK this summer.
Dates are another staple, with Medjoul the most popular variety for the UK market. Plantations have been increasing steadily over the last five years, with a switch from the Arava to the Jordan Valley, where growing conditions are more suited to production. “I am trying to think about how we can make more of Medjoul in the UK,” says Yacovson. “I think we might go to another category, such as confectionery or snacks. I have been looking at offering strip packs of 50-60g, for display by the till at supermarkets or at the gym, and marketing Medjoul as healthy candy.”
But while for most lines it will be business as usual, some of the more exotic offers have been affected by the recession and demand has dropped. Dragon fruit varieties Apollo and Venus are likely to see sendings halved this season. Passionfruit is expected to be another casualty, as a result of tough competition from cheaper Colombian alternatives, but it is too early to say how much will be sent to the UK. Sweet potato sendings are likely to take a further hit, with exports to the UK anticipated at less than 30 per cent of total production, down from 50 per cent in 2008 and 70 per cent the previous year.
“The economic situation is certainly one over which we have no control and yes, the local market and Europe offers a better return as a result, but the UK still remains a very important market and above all does offer stable programmes,” says Yacovson. “It is just a question of balance to ensure that both customers - UK retailers and the growers - are satisfied…
“We are cutting costs, focusing on efficiency and transport and we are cutting back on all kinds of small things to reduce our expenses. The main aim is to survive.”
David Crossland of Mill Associates is hopeful that trading conditions will improve as the sterling strengthens. The firm, which markets produce for Arava UK, is embarking on its first mango season this year and so far, all indications are that it will be a rewarding exercise. “The situation has got better since sterling has improved,” says Crossland. “It is much better than it was five, four or even three months ago, when it was a lot more painful. I do not think it will affect the Israeli season as much as it did before.
“The grape season this year was unusual because everyone was being very cautious and not taking risks, so they were not storing product - from that point of view, it was more straightforward. But the volume going to the UK was reduced and at the same time, Egyptian fruit was a week late. It became a very buoyant market and returns for growers were considerably better than last year.
“So I have my fingers crossed for the mango season…
“The answer to the challenges that we face is to make sure that we offer a product that we offer value to the consumer,” he reasons.
Marius du Plessis, managing director of MTEX UK, shares these expectations for the next few months. The firm’s core summer offer includes stonefruit, grapes, mango, figs and lychees, but it plans to increase its summer lines year on year.
“This summer, we will start with a few new lines of summer product in the UK market and expand on the success that Mehadrin has as a leader in the citrus markets around the world,” says Du Plessis. “We have no choice but to adapt to this and to be honest, we have been in this currency challenge well before the sterling weakened due to the fact that the Israeli shekel is such a strong currency at the moment.
“We have done some operational cost efficiency cuttings and adapted to the situation, but the UK was always and will always be a focus of MTEX.
“In times like these, there are a few basic business principles that return to the top of the list, such as operational efficiency, financial stability and a global marketing mix. MTEX is fortunate to have a management team that value these basic principles,” he adds.
But Du Plessis admits that sales of exotics have been slowed by the recession, but says this has been counteracted in part by a sales increase of basic products such as citrus, potatoes and carrots. “The secret is in a balanced and well-planned marketing mix in the UK, as well as other worldwide destinations,” Du Plessis adds.
But how can Israeli growers and exporters be sure that they are getting the right price for their summer products?
“Israeli growers have become more efficient, Agrexco has cut costs and supermarkets continue to develop their business, with some multiples approaching the growers themselves,” says Yacovson. “All of this will drive the right price - but we must remember that while price is important, it is not the only parameter. That is why we sit between the growers and the supermarkets, to make sure quality is high and all the specifications are met.
“And we are investing across the board, but more so in winter lines, because for summer lines the orchards are already there in the ground and now we have to focus on letting them grow.”
Israeli growers and exporters have their work cut out to stay competitive, especially as their summer lines come into the UK market just as the shelves are stacked high with rival fruit and vegetables and home-grown produce comes into its own. “This trend towards UK consumers buying more local fruit has taken off because of the economic downturn and the exchange rate, rather than because of the provenance of the fruit,” says Yacovson. “We try to be as competitive as we can, supply better or niche varieties and better quality.”
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