Brazil: Good prospects for fresh produce industry

The truth is that the people want and are demanding new general elections, but these are not likely to be held before 2018 (normal schedule). After the pressure that demonstrations have exerted this weekend against the Government, together with the large-scale investigation into corruption and money laundering in Brazil, the country's political future is indeed uncertain.

In any case, there seem to be good prospects for the fruit and vegetable sector. According to Ricardo Cipriani, after a very quick and drastic devaluation of the currency for importers in 2015, the exchange rate has remained stable for a couple of months, which is reassuring for investors and for the sector. "I think the currency's current value serves both exporters and importers of fruit and vegetables, but what matters most is to have stability, as this allows both parties to arrange their operations in a calmer manner."

Prices in the Brazilian market are still quite flexible, but the market is much more sensitive in terms of volume than it was two years ago, so any increases in the volume have a direct impact on the price, according to the importer.

The Spanish stonefruit season is very important for both Brazil and Spain and usually dictates the mood of importers in Brazil for the second half of the year. "The volume of stonefruit received in Brazil this year has been much lower than in 2015; we are talking of at least 40% less to date. The price at origin, however, was approximately 30% higher."

The season is coming to an end and there are hardly any traditional Angelino plums left. "It has been a season with lower quality compared to last year, but the fruit has arrived in fairly good condition. The target market recorded many oscillations, with some very good moments and others with plunging prices and demand. We need to wait for the end of the Angelino to find out what the final balance of the 2016 campaign will be," stated Cipriani.

As for the remaining months, Lócuston expects a very strong trade of apples between Europe and Brazil, mainly of the Gala variety. "We had a small local production in terms of volume and it was poor in terms of quality, which resulted in a need for imports, mainly from Chile, even during non-traditional months, like February and March. The volume of apples imported by Brazil so far is already very large and it is likely to grow even more with the supply of European fruit."

The factor which will determine whether an unprecedented volume of imports is reached or not will be the price, since, according to Cipriani, the prices charged today for the Gala in the Brazilian market are already quite high and appear to be close to the maximum threshold for this product. "There are excellent prospects when it comes to the volume, so we need to observe how the market and the supply at origin will develop."

Lócuston works as representative for several exporters in Europe, the United States and South America. "We work with companies with a great tradition. These are companies that, individually, already have a great product line, but which by joining forces have managed to greatly increase the range under a single methodological service line. In short, a consortium has been formed with companies that share the same business values. We sell their fruits in Brazil and are exploring the market and its competitors. We are their eyes in Brazil," concludes Cipriani.