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10th part of the Moldova Special: USAID's HVAA Project

"Thanks to our efforts, we now have a good export of Moldovan plums to Germany"

We have already given a general introduction about the reasons for this special series, some basic, general information about the country and horticulture, and have told three companies' stories. This article focuses on a U.S. government program that has supported and helped develop fruit cultivation and export in Moldova for the past six years: the "High Value Agriculture Activity in Moldova" project (HVAA project).


Colleague Tatiana shows a beautiful bunch of Moldova grapes

Diana Vlasiuc works at Chemonics in Moldova. This American consulting firm was tasked with realizing this project in the field. Diana tells us about the objectives, concrete operation, and results achieved by this initiative that is entirely funded by USAID, one of the world's most important international development agencies.

It was created by President J.F. Kennedy in 1961 to, as the agency states on its website: 'conduct international development efforts to save lives, reduce poverty, strengthen democratic governance, and help people beyond direct aid.' The HVAA project focuses on developing Moldova's horticultural sector, thus allowing it to enter the international market competitively.

To roll this project out, USAID chose Chemonics, a consulting firm founded in 1975 whose mission is to 'promote meaningful change around the world and help people lead healthier, more productive, and independent lives.' The first projects on which the agency set its sights, in partnership with USAID, were in Africa, but it has since broadened its horizons to include the entire globe. In recent years, the U.S. has also supported the Moldovan horticultural sector professionally and financially.

Reaching its great potential
"Moldova's agricultural and horticultural sectors' futures look promising, but to increase its competitiveness and reach its full potential, the country needs systemic support," begins Diana. "As the project's name suggests, our support is focused on high-quality horticultural activities, crops that bring a high net return. Specifically, three product groups are involved: wine, honey, and fresh produce. The project's wider goal is to create a higher standard of living for rural Moldovans."


Diana in conversation with CBI advisor Piet Schotel

"To meet new market demands, we advise and financially support growers and exporters in areas like cultivation practices and infrastructure, certification, storage, packaging, and logistics. And we analyze which fruit varieties are suitable for which markets. Plus, we very specifically match growers with buyers from different countries. I'm involved as a trade and marketing specialist," Diana explains.

Variety diversification
The project's first focal point is variety diversification. "Most orchards are still oriented towards Russia, until recently, Moldova's most important market. In apples, there was and still is an oversupply of Idared and other old varieties. These don't fare well in Europe and the Middle East, the two main markets we want to tap gradually. The share of apples exported to Russia dropped from 95% to about 80% in the spring after the war began. With the embargo, exports to the Russian market have stopped completely. The challenge now is to grow the right varieties for new markets. In Dubai, for example, Gala is popular."

"The plum orchards, too, are gradually being renewed. On the German market, where we started an export plan in 2018, Stanley plums are in demand. Those from Moldova have a better Brix value than those from Serbia or North Macedonia. Plus, they come to the market from September to November and when we have big volumes of plums it could be December, inclusive, when there's less supply from the other origin countries. By then, the harvest in Southern and Central Europe is over," Diana continues.


Thanks to the efforts of HVAA, large quantities of plums are now exported to Germany

The correct certification and logistics service
The HVAA project does not only advise; it also offers the financial means to reach a concrete goal: to make the Moldovan fruit sector attractive and competitive in the international market. "And for that, first of all, you need the correct certifications. The project encourages companies to implement GlobalGAP and GRASP and pays the associated costs. There aren't yet many Moldovan cultivation businesses that can present these certifications necessary for premium markets."

Over the past five years, with USAID’s financial support, HVAA Project has managed to help many companies improve their infrastructure investing in innovative technologies and best practice. "For example, we facilitated the implementation of different grants that improved fruit sorting and packaging (eg flow-pack and bushel cargo). In the past, that was hardly done for the Russian market," says Vlasiuc.

Those who want to ship apples to Europe or the Middle East can count on financial support too. "This year, we took care of the logistics costs for exports to Europe because when Moldova has to compete with local crops, transport costs, of course, put the county at a disadvantage. Also, we provided €3,500 per route for transport to the Middle East."

Opening the ports to new markets
To improve their export opportunities, Chemonics travels to trade shows with Moldovan growers and exporters and organizes trade missions. "Back in 2018, we started an export plan for Stanley pears to the German market. The following year, three loads went to a large German cooperative. They liked the product, and the import quantities rose steadily. Last season, 60 trucks left for that customer. We're very proud of that. And last year, we assisted and supported, financially, the Moldova Fruct Association in the organisation of a trade mission to Dubai," says Diana.

"A few contracts came of that, so, for the first time, Moldova exported products to that Emirate. We don't draw up the contracts, but we develop marketing plans for key exporting entities, we advise them about the market requirements and regulations, we provide grants to support innovative marketing activities and the promotion of fruits on non-traditional markets. Ships with Moldovan apples have since left for other Middle Eastern countries and Malaysia too. Just two weeks ago, a large company from Dubai visited us, planning the import of over 40 containers of Gala apples. There's, thus, clear progress."

And according to Diana, even though Poland and Ukraine also have their sights on the Middle East and Asia, there is more than enough apple demand. "Moreover, we have excellent quality here. So, in this project, we also focus a lot on the right cultivation techniques and we encourage the growers to pilot modern orchard as pergola, or intensive apple’s orchard. I even think our Moldovan apples taste better than our competitors' apples. Although, to be honest, this isn't entirely our own doing; we should be especially thankful for the favorable climate and fertile soil Moldova freely offers."

Two years ago, the Moldovan sector saw its chance. Frost hit Italy and Spain, causing extensive damage to their apricots, which led to a shortage of those on the European market. "We grabbed that opportunity with both hands. European customers who tasted our products loved them, so we were off. We still get orders for our apricots, even when there's sufficient supply from Spain or Italy. This success story gives me confidence that within five to ten years, we'll be able to sell a significant part of our apricot and other fruit crops on the EU market. Flavor: that's our trump card," Diana explains.


Many sorting lines were placed throughout Moldova via USAID

Still, there is much to be done to fulfill that dream, as the Moldovan fruit sector cannot yet always supply the required volumes. "In the case of apples and plums, many orchards still have to be cleared and replanted with varieties European customers demand. The legacy of our focus on the Russian market still currently bears much weight. For instance, this year, we, unfortunately, had to turn down a request from a large German importer for plums simply because we couldn't meet their program's required quantities."

Diana hopes the temporary trade liberalization of the seven Moldovan horticultural products that had not yet been fully liberalized - tomatoes, garlic, grapes, apples, cherries, plums, and grape juice - will be extended beyond this one-year term. "Otherwise, we'll again be hampered by specific quotas, like, say, 20,000 tons for plums."

Moldova Fruct to continue its work
The HVAA project ends this year, so Chemonics has been working closely with Moldova Fruct for some time, including training some of this industry association's staff to continue supporting growers and exporters and to ensure sustainability.

"We're helping to further professionalize the organization so growers can approach them with complete confidence when they need advice or help. We channel the financial support we offer growers through Moldova Fruct, which proves we consider it a privileged partner. And that we're sure it will continue our work. After all, they know their members' and growers' needs best. We're now waiting for a new project to be announced soon. It will also focus on the agriculture and horticulture sectors, but with different emphases," Diana concludes.

For more information:
www.chemonics.com

Diana Vlasiuc / Tatiana Burca 
Trade and Marketing Managers
Agricultura Performantă în Moldova
High Value Agriculture Activity Project (HVAA)
USAID Contractor
Email dvlasiuc@moldovaagro.com / tburca@moldovaagro.com 


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