The big price difference in the US market is disappointing for Peruvian producers. Peru will end the avocado season with about 45% more volume than in 2021 says Daniel Bustamante, Chief Commercial Officer of Agricola Cerro Prieto. They are one of Peru’s top 5 growers and exporters of avocados and blueberries to the US, Europe, Israel and Asian countries like Malaysia and India.
“Despite the rise in prices for Mexico and California, due to a shortage in the Mexican production, prices for Peruvian avocados where disappointing – at some times less than half of those of MX or CA. In part, this reflects the condition in which most of the Peruvian fruit is sold under commercial programs and not to the spot market, but still the market did not react to pay the premium due to the shortage,” states Bustamante.
As the Peruvian avocado campaign is coming to an end for Ciero Prieto, with offices in Lima and farms in La Libertad Peru, they aim to still increase their exports by 66,6% to 20 000 tons. “Volume wise, the season should end at approximately 125,000TM (275 MMlbs), a 45% increase vs 2021. Towards the end of the season with higher Mexican volumes in the market, the price for every origin has dropped, and more so for Peruvian fruit, regardless of the commercial programs that were setup,” explains Bustamante.
The ongoing shipping price increases and delays are still a concern for Peru, much like the rest of the world. “Logistics have been one of the most complicated issues this season, with prices that doubled those of last year, a shortage of containers and a detrimental service not complying with transit times and dates of arrival. Delays in arrivals, when they are too long might compromise the quality, and for sure affect the delivery of the commercial programs with the consequent loss in sales,” says Bustamante.
Daniel Bustamante, Chief Commercial Officer of Agricola Cerro Prieto
He says they are so passionate about growing and exporting avocados and blueberries that the company has stopped the table grape and other fruit production.
“Our focus is to concentrate on our two core produce items: avocados and blueberries. We are aware that we will not be attractive enough unless we are able to supply year-round to our customers, and in order to achieve this we need to grow in several regions, both in Peru as well as internationally. We feel that the industry is evolving very fast, and we need to keep up with the new trends, alternative distribution channels and the healthy eating habits; that is one of the reasons why we have chosen two super foods as our core products. The goal is to supply our main clients with quality produce and to be in much closer contact with the end consumer; the story is too good, not to be told: We are a social and environmentally conscious company, delivering quality produce year-round to households around the world.”
Bustamante and the team from Cerro Prieto are looking forward to attending Fruit Attraction in Madrid early next month. The company has their sights set on growing in Europe as well as in Asian markets.
“Fruit Attraction is extremely important for our company, because 55% of our avocados are sold in Europe, and the timing of the show happens when our Peruvian shipping season is over. It is the perfect moment to settle any differences and take note of lessons learned for next season. We have a very special relationship with most of our clients, we foster a partnership feeling with our clients because this is a long-term business. Europe is a market where we still have a lot of room to grow, and we will be more present throughout the year. Asia, as a whole, is the market which holds the highest potential growth for our products, but the logistics are very challenging due to extremely long transit times. It is also a very demanding market, which puts up a high barrier of entry, with which we are comfortable to compete,” concludes Bustamante.