Exports of apples to Asia continue to be slow, though market to market there are notable differences.
“Some countries are doing better than others,” says Donna Feltrup of L&M Companies Inc. based in Union Gap, WA. “It also depends on how the customer over there is set up and what they’re doing (i.e. retail versus foodservice, type of apples and more.)”
Here’s how some markets are looking.
INDONESIA: “COVID-19 has slowed apple sales. They’re working through the product that they had,” says Feltrup. “They’re expressing interest in Washington apples but it’s not a brisk market by any means.” She adds that Indonesia has had an uptick in interest in Royal Gala apples as well as Granny Smiths, but that they are also still ordering Red apples. However, along with COVID-19-related challenges, political issues within the country have made it challenging at times to ship product.
MALAYSIA: “Malaysia is doing better than they were prior to COVID-19,” she says, noting her client there is selling to retail and retail sales of Washington apples in Malaysia are doing well because the state’s products are deemed safe.
THAILAND: Thailand has been a slow market. “I think they’re starting to reopen a bit now but it’s still pretty slow,” says Feltrup. That said, more varieties of apples are being ordered.
VIETNAM: “Vietnam’s been limited in buying apples since before Chinese New Year,” says Feltrup. “Sales have been slow and the wholesale market is closed.” She does note that buyers are quite particular in what they are buying. “They only want high-colored Gala apples and limited Red apples in certain sizes.” She does note Vietnam is taking fewer Red apples than they used to but they’re still ordering as many Galas as they always have. Given this continued interest in Galas, even during COVID-19, Feltrup believes this fall’s demand will be back up for the apples once fresh crop has arrived.
Overall, Feltrup notes that prices have gone down on exports to Asia. “When COVID hit, our currency got stronger. Because of that, prices were 10-15 percent higher than post-COVID prices due to the exchange. That hurt their buying power,” she says. “To keep buying coming in, we had to adjust our FOB prices. The movement was also not there so even if you wanted to keep it high, you had to adjust if you wanted movement.”
Looking ahead, while she anticipates demand for Washington apples to get stronger, the strengthening of the domestic market is also having an effect.
“Domestically our bagged business for foodbanks and some USDA bids take a lot of small sizes. The price of the bags is now more than the price than we were selling to Indonesia on these same sizes. For these sizes, we’ll either have to raise our prices to stay competitive with the domestic business or we will not be able to ship them overseas,” she says.
Domestic business on the 3 lb 1/2” bags has also seen increasing demand. “We are seeing more of the fruit being packed for domestic consumption in these sizes than for export,” says Feltrup. “If this continues, we are going to see a shortage of supply for our export customers in some varieties and sizes.”
For more information:
Donna Feltrup
L&M Companies Inc.
Tel: +1 (509) 225-2602
donna.feltrup@lmcompanies.com
www.lmcompanies.com