It has been a turbulent couple of seasons for Canary Islands salad growers and exporters, and the industry’s relationship with the UK market has become more and more stretched. The decline in production this season has been widespread, with major lulls in production area in both Las Palmas de Gran Canaria and Tenerife - and the industry is blaming ever-increasing production costs and low returns.
The sector has been plagued by problems including higher freight and general costs, the use of non-resistant varieties resulting in poor-quality product and condition, a lack of volume and exchange rate issues.
“Last year, volumes were over-supplied in important periods, which clashed with over-supplies from Spain and Morocco,” says Steve Cornwell, managing director of SpaniaFresh, importer of tomatoes, cucumbers and to a lesser extent peppers, to the UK. “When prices did become favourable, volumes were down and the quality later on in the season was very mixed. This year will be the most crucial ever for the Canary Islands.”
The main factor affecting Canary Islands exports to the UK is the weakness of sterling, which is crippling trade. “Changes in prices are still driven by supply and demand linked to the relative exchange rate of the sterling and euro,” says Andrew Zerpa-Falcon, managing director of importer Victoria Trading Limited. “The impact of the recession across winter salad production seemed to be at its peak last season, with availability of capital for financing crops being difficult and at a premium. The availability of capital has improved slightly since the lows of the summer of 2008.”
However, SpaniaFresh has managed to increase its volumes this year, due to its larger independent growers expanding their own operations by taking over some small- to medium-sized growing areas that have been sold on by other growers.
“Production keeps declining and, with little help from banks, there are more growers going out of business,” says Jose Hernandez, managing director of Fortuna Frutos Ltd, exporter of mainly tomatoes and cucumbers. “Most of the growers that will continue are also under difficult financial situations, so this coming season will be vital for survival.
“Generally, quantities will be once again down from last year in the Canary Islands but, on the other hand, we have increased our cucumber volumes for this forthcoming winter by approximately 15 per cent, from last year.
“Being isolated from mainland Spain means that the cost of living is higher. The unemployment rate is one of the highest in Spain, at around 28 per cent, and it could go even higher towards the end of the year.”
SpaniaFresh believes that the quality of Canary Islands tomatoes this year will be a vast improvement on last season. The company is now concentrating on two well-performing varieties, Boludo and Dorothy, which produce a good size and quality. There will be trials of other types, but this will be kept to a minimum to stop mixed-quality produce finding its way through the packhouses. “We will start a week to 10 days later than normal, but by the middle to the end of November we will see a bit more volume than that time last year,” says Cornwell. “We will then stay with good volumes through the season and our supplies will remain consistent.”
Victoria Trading mainly imports cucumbers and tomatoes from the Canary Islands, with a focus on round, large vine, cocktail vine, cherry vine, plum, baby plum and beef tomato varieties, and does not feel there has been a downturn in the industry.
Zerpa-Falcon says that the emphasis on vine tomatoes and specialities has increased each year over the past five years, as consumers in the UK are focused on tomatoes with enhanced flavour and colour. Victoria Trading represents around 50 per cent of the Canary Islands imports through the Canary Island Fruit Terminal in Southampton, and expects volume to grow this coming season.
“Last season, we had good availability and supported our customers with significant extra availability from the Canary Islands when colder weather affected the availability and quality from the other principal growing regions,” says Zerpa-Falcon. “This was both in tomatoes and cucumbers. We do not expect to see availability issues this year because the climate is so stable; we have the benefit of the Atlantic ocean balancing the temperatures to limit the extent of temperature fluctuations.
“All the growers we represent are looking forward to the forthcoming season; forecasts are for good quality and production.”
Indeed, growing conditions have been kind in the Canary Islands, with warm weather conditions in the early periods of planting and growing. According to sources, plants look healthy and the weather this summer has been very good. But imports are not expected in any great volumes until the end of November.
Zerpa-Falcon thinks the Canary Islands are well placed for the future because of favourable growing conditions for salad products. “Weather conditions in other regions seem to be getting less and less predictable, while the stability of the Canaries remains unaffected,” he says. “This gives us consistent availability of quality products throughout the entire winter season. Allied to this, we have industry-leading integrated pest management (IPM) that gives us a great and safe product. As we start to come out of recession, carbon footprint and sustainability of production will re-emerge as key factors, and with our low carbon seafreight, alternative energy production, IPM controls and sustainable generated water, we expect to be well placed to meet the demands of a carbon-conscious marketplace.”
Fortuna Frutos is working with a new variety called Mariana and has moved the tomato to a bigger trial following last season’s success. It found that the variety produced good quality and consistency throughout the season.
“We have noticed that both in the Canary Islands and mainland Spain, the current varieties do not produce as much yield as in the past, making the cost of growing extremely expensive, and also there are more diseases to deal with,” says Hernandez. “Overall, volume is also down between the Canary Islands and Spain, so at times this season we are sure availability will suffer.
“Subject to good growing conditions, we do not expect fewer volumes, although we can pull more volume from our production in southern Spain in case of any problems. We normally plant in three stages during the season, so as usual we would expect to carry on until the end of June 2010.”
Cornwell is calling for the fresh produce industry and end consumers to be more responsible and to be prepared to pay more for Canary Islands salads in order to sustain the business. “Let’s not kill our supply,” he states. “There will be lower volumes this year, but that includes Spain and Morocco as well. They have the serious problem of the South American mosquito virus Tuta absoluta, which is causing havoc in tomato crops. Therefore, in general, there will be less supply this year.
“The Canary Islands have a good future, but clever planning, good co-operation and sharper consolidation will be essential. Good weather combined with growing the correct varieties and good husbandry will put the industry on the right footing.”
Hernandez believes that growers are the key to the industry. “We have to keep our hard-working growers in business,” he says. “Some of these families have been in the industry for many years - up to three generations - and it would be really sad to see more growers going out of business. Without their product, we cannot can carry on in the business, so we are hopeful and pray for a good season to keep us all going.”
THE CANARIES MUST CONTINUE TO BE IMPORTANT
We must continue to provide good-quality tomatoes consistently for our clients so that the Canary Islands can still be seen as an important source during the winter, writes Bob Curwood, commercial director of Allfruit International Ltd. Our clients do appreciate the importance of their growers in the Canary Islands continuing to produce good quality, while competing in the marketplace.
The climatic conditions on the mainland during the winter have for the past few years seen very low temperatures - at times causing shortages - but the Canary Islands remain an important source.
The future remains uncertain, but levels of production are now at sustainable levels. The growers need another good season.
We export classic round tomatoes and organic round lines. This year, we have had a small trial of cucumbers. Trials have been done with speciality tomatoes such as large vine and cherry, but it is difficult to compete with mainland Spain due to the overall economic situation in the Canary Islands of recent years, and this is unlikely to change soon.
The new-season plantings took place in late July and again in mid-August and up to now, the crop is looking good. The plants are healthy and we expect exports to begin for the UK around October 26.
Last season’s production was very much down on the previous year, and this decline was due to the economic situation from previous seasons of low returns and lack of new investment and funding. However, last season’s results were better and we believe the levels of production are now at the bottom end and manageable in the current market. We expect similar quantities to last season.
No comments yet