A warm winter and an increase in Europe's cultivated strawberry acreage have led strawberries from various origins to overlap for the first time, causing prices for Spanish strawberries to plunge way before the end of the campaign.
Average prices for Spanish strawberries have already dropped by around 40% compared to 2013 and this is leading many producers to throw fruit away and finish the campaign early. The president of the Association of Producers and Exporters of Strawberries from Huelva (Freshuelva), Alberto Garrocho, points out that the campaign "is a mess, much worse than last year. As a result of prices hitting rock bottom, many producers are finishing the campaign early to save on labour and harvesting costs," says Garrocho.
The price paid at origin barely reaches 0.30 Euro per kilo, "well below production costs," adds Garrocho. "We need to avoid marketing fruit below our production costs because it would entail the ruin of our businesses. A small percentage of the fruit that is being discarded is used by the processing industry, but not all, since the plants are not able to absorb the amount of fruit that is currently being produced," he continues.
Until now, Turkey and Morocco had been considered the main threats, but now competition keeps growing within the European Union itself. Spanish strawberries have had to face fierce rivals who had traditionally been clients, such as Germany, France and the UK. The scenario has further complicated with the entry of produce from Italy, Belgium and the Netherlands. "Morocco already finished its campaign in March, but ever since, there has been an overlap in the start of the campaign of various countries like Germany, UK, Italy, Turkey, Belgium and the Netherlands. The huge gap between supply and demand has driven prices down," explains Freshuelva manager, Rafael Dominguez.
"The purchasing power of consumers has suffered in recent years"
Another concerning aspect is the economic crisis. "The purchasing power of consumers has suffered in recent years," said Dominguez; the 2012-2013 season finished with a production of 274,800 tonnes; 10% less than in the previous campaign. This decline led to a 20% drop in the sector's total turnover, which stood at 315.6 million Euro.
Meanwhile, the fruit's average price dropped by 14%, according to figures provided by associated companies. Spain is the largest strawberry producer with 374,000 tonnes, according to recent data from 2012. It is followed by Turkey and Germany, with 352,000 and 155,000 tonnes respectively.
Finding new markets: Russia, Arab countries and Scandinavia
Another of Freshuelva's initiatives is the search for new markets, particularly in Russia, as well as Arab and Scandinavian countries. Dominguez notes that to reach these destinations, logistics infrastructures, need to be improved, which would include the opening of an airport in Huelva. "Seville's airport is not prepared for the transport of perishable goods, so the fruit is being carried by road to Madrid for it to be shipped by air to countries like Russia."
The Port of Huelva could also play an active part, as "it would be very useful to have a line connected to Rotterdam," said Dominguez. This is the main reason why Freshuelva supports the airport initiative promoted by the Christopher Columbus Society, formed by the Chamber of Commerce and Huelva's Provincial government, which would leave the airport's management in private hands.
For more information:
Freshuelva
T: +34 959 24 8222
freshuelva@fepex.es
www.freshuelva.es