Peru: Asparagus export price will remain high this year

The concern that there was about the business of asparagus, Peru's fresh produce agricultural exports star, entering a period of decline in the following years because of low prices and old plantations has dissipated.

On the one hand, at least for the remainder of the year, prices are expected to be very good and, secondly, the old plantations are being replaced by new ones, thus maintaining the agricultural frontier, which is approximately 27,000 hectares nationwide.

According to Armando Grados, general manager of the Civic Association Frio Aereo, the export price of asparagus would be, depending on the quality of the product, at about US $3 a kilo (in the case of fresh asparagus). "Last year it increased 30%, and we expect that the price holds this year," he said.

A projection that is also shared by Guillermo Van Oordt, former president of Peru's Agricultural Exporters Guild Association (AGAP), who also said that 2013 would be a good year for this product.

According to Armando Grados, the price of this vegetable increased because of the higher demand from the United States due to the new policy that promotes the consumption of healthy foods in all the educational and health institutions with a governmental budget.

Price in May

In May 2013, the average FOB price of frozen asparagus grew 7% compared to the average in 2012, standing at US $ 4.17 per kilo, fresh asparagus rose 20% to US$ 3.47 kilo, and the canned asparagus by 15% to US $ 3.05 per kilo.

While executives did not specify what percentage of asparagus plantations are already stale, they said that those that were 12 or more years old had to be changed, because it lowers their productivity and product quality. Guillermo Van Oordt estimated that currently, in Peru, the average productivity of asparagus is 10 tonnes per hectare a year while in 2007 it was 12 tons.

"But, due to the good prices, and so they don't have to reduce the acres planted, several domestic and foreign investors have begun cultivating new lands this year. While the land may be of a lower quality, they are prepared so that productivity isn't smaller, in addition, the humid climate of the coast is very good for this product, it's like a greenhouse, "said Armando Grados.

Investment

Preparing and planting a new hectares of asparagus costs investors between US $30,000 and US $ 40,000, due to the rising cost of labour, supplies, irrigation equipment, etc. Its maintenance requires about $13,000 more a year. In that sense, they expect the exported amount of asparagus to increase this year despite the lower shipping, as happened in 2012. Last year, exports of asparagus (fresh, frozen and canned) grew 11.4% amounting to US$ 524 million, while volume fell 7% to 181,000 tons. In the case of fresh asparagus, export value grew 17% amounting to US$ 337.6 million, but volume fell 5%.

Frio Aereo can double its service capacity

The Civic Association Frio Aereo, the Peruvian logistics operator in the foreign trade specialized in handling perishable products by air, has the space and infrastructure to increase its services by 100%, said its general manager, Armando Grados. "Currently, we move 100,000 tons per year, but we could easily move 200,000 tons," he said. He added that they even moved 1,000 MT of cargo a day in high season, but that it wasn't permanent.

This company that is located in the Jorge Chavez International Airport and serves 80% of the air export of perishable products, will award the exporting firms that exceeded industry standards in 2012 under different quality categories on Wednesday 26 with the Golden Penguin.

Source: gestion.pe


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