Rob Cullum - Pacific Produce

European window for Peruvian grapes getting smaller

The main Peruvian grape season ended in February and it is now in the low season. The 2021-22 season was strong with good volumes and good market conditions with the exception of Western Europe.

“The Californian season ended early so there was a strong demand in North America, the Peruvian grapes are big and have excellent shelf-life so are considered premium in most markets. The window in Europe for Peru is getting smaller as the European grape producers are extending their seasons and Brazil is also now making headway with the updated varieties, the quality may not be quiet as high as Peru but the pricing has been lower – we may see changes this season as the new freight rates will come into play. South Africa and Namibia have been slower than Peru to move to new varieties but are getting there now and have a currency advantage,” according to Rob Cullum from Pacific Produce.

“The UK market is difficult as they require 10x500g punnets which are very expensive to ship. Retailers in the UK have also done a good job of pushing prices down over the last 5 years or so. In my opinion prices have been too cheap for a while at £1.50 or £2 a punnet, grapes are expensive to grow and this low price has affected the quality of grapes on the shelves which in turn has affected consumption. Consumers only see white, red or black grapes and the price tag, they don’t see the producing country or often variety. If they get bad quality grapes, they assume that all grapes will be the same and it takes a long time for them to go back and purchase grapes again. This is a difficult moment in time to talk about paying for quality as households are coming under severe financial pressure but the fact remains the same - quality has a price."

Pacific Produce's production has grown significantly but the share going to the UK and Europe has declined in the last 2 years.

Logistics and shipping costs remain a big challenge, despite this Rob said they were able to meet all of their programs for Peruvian grapes earlier in the year, but the situation has worsened since then.

“Vessels just skip ports and it takes another ten days before the produce comes into the port, this adds additional cost for the supplier and results in quality issues for the receiver. In my view the shipping industry is the only industry who have been able to double the rates and offer half the service and still make record profits.”

For more information:
Robert Cullum
Pacific Produce
Tel: +44 (0) 1865877801

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