Thanks to good weather and improved management techniques, the yield and quality of Chinese pears will increase in the 2023/24 season, with a high commercial fruit rate. With the bumper harvest and the start of the production season, shipping has returned to normal, and overseas market demand has stabilized. Export volume has increased compared with the last season, and export prices have declined due to different factors.
Botou Dongfeng Fruit Co., Ltd. is mainly engaged in the production and export sales of fresh pears, focusing on markets such as Europe and North America. Mr. Guo Zhongtao, from the company, said: "Currently, our company's export volume has increased by about 20%-30% year-on-year. One of the reasons for the lower export price is that the high shipping freight rates and unstable shipping schedules in the last quarter pushed up the price. After shipping returned to normal, the price naturally fell. Secondly, due to the bumper harvest this year, the pear inventory is large and the market competition is fierce, forcing merchants to reduce prices to win customers."
The recent surge in sea freight rates has affected export prices. "Demand in overseas markets is relatively strong. However, since the Red Sea shipping crisis, the European market demand has declined. At present, the freight for each container to Europe has increased from more than one thousand US dollars to five to six thousand US dollars, an increase of four times. It is worth noting that the price of this route has begun to stabilize and gradually decrease recently."
"In addition, sea freight to North America and Australia is also rising. One of the reasons is that after the sharp rise in freight rates during the pandemic, it has not yet dropped to the previous normal level. The other reason is that the number of ships that need to pass through the Cape of Good Hope has increased significantly, and the number of containers is insufficient, which has pushed up the costs. For example, the price of a container sent to Canada has doubled from more than 2,000 US dollars to more than 4,000 US dollars."
Mr. Guo said that because he negotiated with customers to share the rising sea freight, export prices and profit margins were compressed.
"One of the reasons for the large number of recent orders is that shipments will be suspended for two weeks during the Chinese New Year, and overseas customers need to obtain sufficient inventory before the holiday. Our factory will suspend export shipments from February 5 until the end of the holiday."
In terms of domestic sales, Mr. Guo said that pear prices declined after December, and the price reduction occurred earlier than in the past. "When the season started, the purchase price of pears was relatively high. In addition, the production of many fruits is high this year, and consumers have many choices, making sales relatively slow. As the season develops, pear stocks remain large and market consumption is weak, which is the main reason for the early decline in pear prices."
Botou Dongfeng Fruit Co., Ltd. has orchard bases and fruit selection and processing plants, and its export markets cover more than 30 countries and regions in North America, South America, Australia, Europe and Southeast Asia.