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Too many sellers and too few buyers on the pear market

Earnings that do not cover production costs, few exports, a drop in consumption and hyper-fragmentation. This is the list of problems that affect the Italian pear production.

This is what was discussed during a meeting on pear production promoted by the local Union of Municipalities. Albano Bergami, Vice-President of OI Pera, explained that "in Italy, there are 1,300 businesses that are members of POs or cooperatives, 1,000 businesses that rely on external sales networks and 1,200 businesses that sell their own produce. Then there are commercial operators. As they are all competing against each other, price is their only weapon."

Albano Bergami, Vice-President of IO Pera.

"Fca (former Fiat) employs 24,600 people and, if it's true that it takes one operator to manage one hectare, our sector is worth 30,000 people. We are all worried if a car factory closes down, I would like to see if people are aware of what would happen should our sector collapse." 

The main problem is that there are too many sellers and few buyers. Luca Granata, General Director of Opera Sca, and Alessio Orlandi and Alberto Garbuglia, General manager and Managing Director of Origine Group also attended the event. These two organisations gather pear producers from Emilia-Romagna.

Luca Granata, General Director of Opera.

"A few rules are needed to make aggregation work. First of all, organisations must be big. If they do not gather 50%+1 of the production, then they are worthless. They become more efficient the more producers they include. Opera currently aggregates almost 30% of Italian pears, which is not enough."

"Everyone keeps saying we need to aggregate, but nobody does it. It looks to me as if the sector is destined to remain like it is, which is a pity because it would be so easy to obtain those 20 eurocent/kg more that would make production profitable. Still, we keep on competing, even when produce is lacking like this year."

"Opera is the only consortium specialising in pears and it is the largest, not only in Italy, but worldwide. Is it working? No. Who is penalised? Producers. Who can change things? Producers. New packaging, new varieties, advertisement and exports are not enough. Everyone can do that. The only thing left to do is selling as a single unit."

Origine Group, a consortium with gathers 9 members, took the opposite road. "There is no single solution and scale economies don't always create an advantage. We should create a system that constitutes an added value and that can help businesses make investments that would be unthinkable if they had to make them on their own."
"We need to maintain our businesses' specialness, (just think about Zespri kiwis), yet have a multi-product approach. We currently deal with kiwis and pears and will introduce plums next year."

Alessio Orlandi, general manager of Origine Group.

"We are also relying on exports, introducing a single brand (Sweeki for kiwis and Pera Italia for pears) into new markets. We explore new markets that single companies would not be able to approach on their own."

"What we experienced with Sweeki in Spain and Asia, where we had to deal with competition from the local produce, can be applied to pears, which would have no competition. In the meantime, we are also carrying out promotional activities that focus on the flavour of the fruit and introducing innovative packaging." In the meantime, the group is also studying and testing new varieties.
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