Most suppliers of Chilean cherries had already delivered their products for this season at the start of week 4. The cherries have gradually entered first and second tier cities of China. Some have even reached third tier cities. This provides us with an opportunity to understand product quality and the ability of the market to absorb this supply. In week 4, cherries are still the most dominant Chilean product on the import market. Every day an average of around 25 containers arrive. Apart from this, another stone fruit product from Chile has started its first complete export season: nectarines have gradually penetrated the Chinese market just as the Spring Festival is about to begin.
Truck loaded with cherries Chilean nectarines arrive
The product quality on the cherry market in week 4 shows more obvious fluctuations than the cherry market in week 3. Lapin cherries have more problems with the fruit peel, and Skeena cherries show discolorations of the fruit flesh. This has caused chaos for cherry market prices at the end of the week. The price difference between high-quality and low-quality cherries is huge. At the same time, as buyers rush to obtain high-quality cherries to meet the extra demand during the Spring Festival, medium- and low-quality cherries have become difficult to sell. This week the XL-grade cherries from various brands dropped as low as 200 yuan [31.79 USD] (per 5 kg bag).
At the end of this week, the regular-quality 5 kg bags of Chilean cherries cost between 230 yuan [36.56 USD] and 260 yuan [41.33 USD] (JD). It is important to note here that with the approach of Spring Festival many retailers have increased their demand for the smaller 2.5 kg bags of cherries. This has caused the price to rise in first-grade import markets. Many brands that offer 2-in-1 deals or 2.5 kg bags of cherries have seen the price rise with about 20 yuan [3.18 USD] at the end of week 4. The price of SJD-grade cherries already increased to the range of 170 yuan [27.02 USD] to 190 yuan [30.20] at the end of week 4.
The Chilean nectarines are still "newcomers" on the Chinese market compared to Chilean cherries. At the end of 2016, when President Xi Jinping visited Chile, he formally signed an agreement for the import of Chilean nectarines to China. Only in March 2017 did the first shipment of Chilean nectarines arrive on the Chinese market. Since the production season of Chilean nectarines starts in November and ends in March of the subsequent year, 2017 can be considered a trial period for the import of Chilean nectarines to China. The production season from November 2017 to March 2018 can be considered the official start of Chilean nectarine export to the Chinese market.
President of the Chilean Fruit Exporters Association (Asoex), Mr. Ronald Bown, stated to the press that Chile expects to export around 7 million boxes of nectarines in the production season 2017-2018. 50% of that export volume will arrive in China.
The majority of the nectarines that have in the past been imported to the Chinese market were nectarines with white fruit flesh (White Nectarine). However, this week the market was influenced by enthusiastic sales of cherries, and the sales of nectarines were somewhat limited. Their retail speed is still slow. At the end of week 4, the price of 40+ grade nectarines (9 kg bag) was between 150 yuan [23.84 USD] and 160 yuan [25.43 USD]. The price of small 50+ grade nectarines was around 140 yuan [22.25 USD]. This is still quite a competitive price if compared to 10 kg air freighted nectarines from Australia, which sell at 260 yuan [41.33 USD] to 270 yuan [42.92 USD].
Author: Yang Shuang