After the strong 2021-2022 Peru grape season, Vanguard Direct LLC makes its early predictions and expectations as this year’s harvest approaches.
“We are looking at a similarly strong start to last year,” said Dirk Winkelmann, president. The high temperatures in California and forecasted rain is a challenging recipe for the remaining grape crop in this region. Chile is also seeing weather challenges resulting in a drop in crop size by 10-20 million cartons compared to last season. “All this adds up to strong demand for Peruvian grapes out of the gate and likely to stay that way well into our season,” added Winkelmann. For the first time in a very long time, the industry will see a flip this year from Chile to Peru as the more dominant global grape player.
Customer demand for green grapes will be met with the increased volume.
Total grape volume for the 2022-2023 season is estimated at 70-72M compared to 65M last year. Customer demand for green grapes will be met with the increased volume being produced, while red globes (red seeded) will be down 10-15 percent. First harvest will start at the beginning of November in Ica.
“We are seeing retailers and customers in the USA and the UK contacting us for their supply needs much earlier this season,” says Winkelmann. “Two global retailers have already closed their contracts and are not relying on California to take them into late December or early January.”
“You also can’t assume anymore that Asia will always be your premium market. If COVID has taught us anything, it is that to have success, you need to start with relationships first and then execute as flawlessly as possible within the constraints of the various markets.”
Looking at logistics, Vanguard sees a healthier season compared to last year. “We aren’t seeing shipping costs escalating as high as we had predicted,” said Winkelmann.
Winkelmann says for the first time in a very long time, the industry will see a flip this year from Chile to Peru as the more dominant global grape player.
West Coast routes
Port issues are another area seeing some relief. Last year, Vanguard avoided the Los Angeles and Long Beach ports completely, pivoting to the East Coast combined with cross-country trucking in pursuit of shorter transit times despite the significant cost increase. With reductions in port congestion and container release times, the plan is to again utilize the West Coast routes this coming season.
However, the state of global affairs is the new challenge. The European markets have several factors looming large – the exchange rate, inflation and the unrest in Ukraine/Russia. Asia also continues to have COVID lockdowns and restrictions that affect demand/consumption. All of this translates into the potential for more ripple effects across multiple markets and the need for flexible plans and rapid responses.
For more information:
Andrea Bava
Vanguard Direct LLC
Tel: +1 (778) 908-1764
andrea@blitzme.ca
https://www.vanguardteam.com/