Speculation is rife this quarter that with the credit crunch now firmly upon us, the first place consumers may look to cut expenditure is in their weekly shopping basket - and high-end products such as exotic fruit and veg may be the first to fall foul of grocery penny-pinching.
Our online poll two weeks ago - How much of an impact is the ‘credit crunch’ having on the fresh produce industry? - gave rise to some comments that seemed to bear out this interpretation of events.
“Perhaps a drift to focus on the more traditional lines - less spend on high-end exotics, and less on added-value lines. Some parents may relearn how to prepare a fresh fruit salad,” said one respondent.
But if that is to be the case, the situation does not appear to be making itself felt yet. “A certain logic would say that if you were cutting down on your shopping bill, you would cut treats, perhaps indeed tropical fruit, out of the budget. I imagine that fruits like mangoes, which are quite mainstream now, will be fine - but lychees, physalis, pitahayas, etc, they might struggle more,” one importer tells FPJ.
However, another poll respondent said: “Not necessarily true about less spend on high-end. Consumers do tend to ‘trade down’, that is true, but those spending less on treats such as eating out, takeaways etc, often tend to look for something special in the weekly shopping to compensate.”
Demand for exotics has been good overall in the last quarter, say suppliers. “We just finished a review with one of our big customers, and volumes are in fact up by five per cent,” says one insider.
The Costa Rican mango campaign is drawing to a close, with importers reporting a good season. The West African season is now kicking off, with arrivals shortly expected from Burkina Faso, Ivory Coast and Ghana.
“The mango market has been very short for the past few weeks,” says one insider. “March to April is always a tough period, much like October to November, so we don’t expect an easy ride.”
Rain in Brazil has also exacerbated the supply situation, with one importer reporting several mango farms under three feet of water. Picking in the production area of Petrolina was disrupted, and the rain has also raised the likelihood of disease outbreak.
“It has been a tough few weeks, but we are now seeing the light at the end of the tunnel,” says one insider. “We have good expectations of the West African crop, and also the Israeli crop.”
The recent frosts that affected large swathes of Israeli fresh produce plantations did not hit mangoes in a big way, although some areas were more affected than others. Production in the area west of the Sea of Galilee was reportedly more damaged, although growers in the east of the country were relatively lucky. Overall, the industry is predicting a 15 per cent fall in total Israeli mango volume this season. “However, it was due to be an ‘off’ year anyway, in terms of the cyclical production of mangoes, which have ‘on’ and ‘off’ years, so we knew volumes were going to be tight,” says one importer.
Currency devaluation is also making life harder for exotics growers at the moment, with producers in West Africa and Israel taking a hit on their returns.
Meanwhile, difficult weather in Brazil has affected papaya production. Cold temperatures and rain in Natal in the north-east of the country, and also in Linares further south, have disrupted supplies. “Natal is very much a new growing area which has had a lot of money pumped into it, whereas Linares is a much more traditional growing area,” says one insider.
The internal market in Brazil is also paying well for papaya, and is so strong that many growers are finding themselves reluctant to export the fruit. It has, overall, been a difficult year for papaya producers, but the industry fully expects them to bounce back.
“The rainy season will hit West Africa in about five weeks, when Brazil will come into its own again, so the two sources complement each other well,” says one importer.
Demand for papaya is reportedly rising in the UK, but only for product that has been airfreighted. “When papaya is seafreighted the fruit colours up okay, but the 15-day transit time means it starts to lose its edge in terms of flavour. It is never quite the same as with our tree-ripened airfreighted fruit, which it has been proven sells a lot better. As airfreight rates go up, the pressure may be on us to start looking at seafreighted product again, but hopefully the technology will be better by then,” says one importer.
Difficulties have also arisen over the last quarter with fig and passionfruit supply, but new lines such as mangosteen and rambutan from Thailand and chikoo from India are starting to secure niche markets for themselves in the UK.
“It has been a tough few weeks on several lines, but that is down to seasonality, and I would call it a budgeted difficult period,” says one insider.
Tropicals traditionally sell best in the winter, with November to March the key marketing window, so the expected summer sales dip is on the cards. With home-grown berries, northern-hemisphere melons and European stonefruit due to put in an appearance over the coming weeks, consumers may feel less inclined to buy exotics.
FAIRTRADE PINES ON THE INCREASE
Fairtrade pineapples are available all year round, and the market is growing at 20-30 per cent year on year, says Clive Marriott, commercial manager of Fairtrade specialist AgroFair UK. Fairtrade mango sales are growing by 11 per cent annually, due to non year-round availability, although we are getting there. We bring in four containers of pines a week from Costa Rica, and are developing a source from Ghana, and we bring in one container a week of mangoes, depending on the season. We have 300 pineapple growers, and mango producers across Burkina Faso, Mali, Ivory Coast, Peru and Brazil.
I have just returned from a visit to our pineapple partner in Costa Rica, Proagroin. The firm has invested in coldstorage and pre-cooling facilities in its Pital packhouse, and is now planning a second, brand-new packhouse at Guatuso. This will result in improved quality of fruit on arrival in the UK, and also better shelf life. Production of organic Fairtrade pineapples offers a major new opportunity for the growers, as they will receive higher prices with the dual certification of Fairtrade and organic. The initial results have been excellent, with yields not significantly different from conventional and proportionately higher brix levels at harvest giving a delicious eat on arrival in the UK. Organic production has been relatively low while the project gets established, but we expect to have more volume in the autumn as production gets up to full capacity.
Working under the Fairtrade system not only gives growers a guaranteed income, it also gives them the security of knowing that they will always have a market for their fruit. The pineapple growers working with Proagroin also receive credit facilities enabling them to develop their farms, as well as ongoing technical assistance to improve production management. The Fairtrade premium has also benefited five communities in the Upala region of north-east Costa Rica. The premium financed the construction of a small reservoir to collect spring water to supply clean drinking water to around 400 families.
The Apromalpi Fairtrade mango farmers in Peru have invested their Fairtrade premium in a women’s dressmaking project for single mothers and daughters of farmers, to enable them to make a living.
The impact in the areas AgroFair works in is much larger than the numbers of farmers and their families involved in the co-operatives. For instance, the packhouse Apromalpi is building will provide much-needed employment in a region which is not being invested in.
In Burkina Faso in West Africa, one of the world’s five poorest countries, farmers in the Union Départementale des Producteurs Fruitiers de Koloko, which represents more than 300 organic Fairtrade mango growers, used some of the Fairtrade premium to buy a motorbike. This was purchased in order to transport information between the farmers on their small plots of land. “The roads in this region are very bad,” explains Lamine Koulibaly, the group’s president. “There are lots of holes in the roads, and while it is not always easy to get around by car, we can reach producers using the motorbike. To me, Fairtrade is something miraculous. I never thought anything like the Fairtrade premium could exist, but the proof stands right here, right in front of us.”
As small growers they get an all round better deal working with AgroFair. As AgroFair is 50 per cent owned by the farmers themselves (and 50 per cent by Fairtrade organisations and other ethical investors), the farmers also have a real say in decisions made by the company and the directions it takes. Farmers are represented on the board and at annual shareholders’ meetings, with the next in London next month. Representatives of our pineapple and mango farming groups will join banana and citrus farmers to thrash out policies and to exchange information with farmers from other continents.
There is a committed group of consumers who believe that they are doing the right thing by buying Fairtrade produce. Some even buy a pineapple or mango because they see the Fairtrade marque, when they might otherwise choose something else. While you do not see such heavy promotion on Fairtrade produce, average standard shelf prices are not significantly different on, say, Fairtrade pines than on conventional. The difference really is a matter of pence - which is not much to pay for a clear conscience.
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