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Market growth challenges for Chilean growers
Chilean cherry producer scopes Japanese marketFor Chilean cherry producer, Alejandro Becerra, FOODEX Japan has provided the opportunity to scope out a new potential market.
FOODEX JAPAN is Asia's largest exhibition dedicated to food and drink with around 82,000 buyers from food services, distribution and wholesalers and trading companies attending the four day event.
A cherry grower, packer and exporter, Alejandro's company, Grupo Esmeralda, is based in the Curico region of Chile - an area also famous for wine production.
With 110 hectares already planted and planning for more, the company also works with a grower base with a production area of 350 hectares.
"I am here prospecting this market because the certification for Japan and South Korea only came out several years ago for Chilean cherries," Alejandro said.
"Before we had to fumigate which raises the temperature of the cherries. This affected the quality and shelf-life was shortened. Certainly ocean freight wasn't an option."
"Now this has changed we have complete some ocean shipments to South Korea with an interesting result. So if we find the right niche here in Japan, ocean freight may be an option."
"We don't have to only focus on China. Our eyes need to look around and see the opportunities in other markets."
Alejandro Becerra at FOODEX Japan
In visiting Japan, Alejandro had already conducted research on consumption habits of Japanese consumers - which he says present a challenge including with market identity.
"In our peak harvest time, being the southern hemisphere summer, we find the Japanese consumers don't want to eat cherries in their winter," he said.
"Even though we have cherry varieties of Lapin, Bing and Regina, here they are just labelled as American cherries."
Alejandro said that, while Japan is a difficult market to access, he was optimistic there were niche opportunities in this market for Chilean growers.
"My country depends too much on China as a market. In the future, we need to start diversifying the markets."
Across the 2017-2018 Chile cherry season, records were broken with 80% of the national cherry crop exported into the Chinese market - equating to 150,000 tonnes.
Additionally the industry saw rapid growth in the South Korean, UK, United States, Taiwan and Brazil markets.
Alejandro says market diversification isn't the only challenge for the rapidly growing industry with logistics and transport providing other challenges for growers.
"Usually the biggest volume of crop is close to Week 50 - 51, being so close Christmas means space with air freight is really tight. As the season moves along, it becomes harder and more costly to send cherries by air. We find air freight is an issue including with connecting flights."
Alejandro says sometimes fruit will sometimes sit at an airport either in Miami or Europe for 2 -3 days waiting for a connecting flight which affects the quality of the fruit.
However, according to Alejandro, when it comes to shipping, there have been significant improvements in sea logistics - noting that challenges remain.
"We have some really good options now including one vessel per week leaving from Chile to Hong Kong, taking 23-24 days. This is really good for us, but even then with the speed and pace of Chile growth in the cherry sector, this shipping option won't have enough space in the future."
Alejandro said some containers of fruit were left behind as there wasn't enough space on board. "They were loaded several days later on a slower vessel or the following week on the fast vessel. For fresh fruit, an extra week can make a huge difference to quality."
The past season, although recording breaking, saw a glut of cherries with early varieties delayed
"Packing capacities were overwhelmed with fruit being stored for several days before being packed," he said.
Alejandro said the 2017-18 season was a mixed one for his farm.
"We tried to keep the volume of fruit low and manageable so we didn't have these capacity or freight issues."
He said the season provided lessons for them on production, management, packing and logistics. Over the next five years, Alejandro sees the Chilean cherry industry growing up to 30%. Having planted new orchards over the past three years, Chilean production is set to rapidly improve as the new trees come on line.
For Alejandro, the future is about setting industry standards in quality and ensuring market diversity. "We need to be careful and look to the future. Prepare in advance and not just react. This is why I am in Japan to look for the next opportunity."
Alejandro J. Becerra
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