Chile: Good results of fruit sector are linked to China

Fruit growing is one of the activities that gives Chile the most benefits. In the last season, the country exported 2.72 million tons of fruit for US $5.283 billion.

Some varieties have managed to seduce markets and recorded important returns. However, other varieties, some of which have a considerable weight in the export mix, are facing difficult moments. One of the best positioned species are the cherries, with sales that are near those of table grapes.

The Minister of Agriculture, Antonio Walker, highlighted the record of the previous season and said that the good results “go hand in hand with a booming economy in China.”

The president of the Association of Fruit Exporters (Asoex), Ronald Bown, said that the country’s cherry production and export would continue to grow. The entity will carry out again the promotion it deployed in the previous season, in which it invested US $ 5 million. Meanwhile, the head of the Federation of Fruit Producers (Fedefruta), Jorge Valenzuela, said that the cherry had already displaced the table grape as the main crop in the Region of O’Higgins.

However, Valenzuela said, “the large-caliber cherry business is different than that of the smaller sizes. The profitability of the first one is important; with the smaller ones do not cover the costs.”

The situation is serious for table grapes. It continues to be the most important exported fruit, but its sales have fallen. Minister Walker said that “the lack of water in the north, the loss of competitiveness of some varieties, which no longer meet the requirements of the destination markets, and the effects of the Lobesia botrana, which forces us to fumigate the fruit at the expense of its quality, are factors that are causing a loss of profitability.”

According to Ronald Bown, there are challenges: “There are varieties that are not giving the results of the past and that can’t find a market, as in the case of the flame variety. In addition, the Chilean advantage, especially for the early grape, practically does not exist, as it now competes with fruits from California and Peru,” he said. Thus, he stressed, varietal replacement is key.

Valenzuela said that the Region of Coquimbo Region, which concentrated 49% of the production in the flame variety, was facing a crisis due to the problems that this variety is facing. He stated that this was one of the greatest examples of why they were promoting the renewal of crops for more attractive varieties by means of a law to promote reconversion.

The importance of the Chinese market
Ronald Bown stressed the importance that China has acquired for their exports. For example, the Chinese market just opened its doors to Chilean nectarines in October 2016 and in the last season Chile exported more than 16 thousand tons of this product to that market. “It’s a fruit and a market that could grow,” he said. He said that the avocado had also had a positive season. Minister Walker also highlighted the results obtained in avocados and nuts.

Meanwhile, Valenzuela stressed that the emergence of southern Chile as a fruit-growing area of ​​berries had helped the blueberry boom. He also said that the avocado had a lot of potential, despite the fact that several hectares of this production have been uprooted in the Region of Coquimbo because of the large amount of water this crop requires. He also said that the “mandarins are emerging as an alternative to the production and marketing problems that obsolete orchards with high cost or old varieties have.”

Other varieties are facing a similar panorama to that of the table grape. Walker said that the quality of the raspberries is not what it used to be. “We need to replace what we have today, and there are alternatives to do it, even with varieties produced in national breeding programs.”

Bown also sees risks in apples and pears. “The trade war between the US and China and the tax increases that China applied on US apples could have consequences on this sector. The US will look for markets where to place its fruit, and those are also the markets where Chile sends its apples.”

He also said that opening the Chinese market to Chilean pears could be positive to have a greater diversification of destinations.

According to Fedefruta, the nuts are facing a difficult situation, as they found high inventories in the destination markets, which would lead to a fall in prices. In turn, as a result of the trade war, India applied reprisals tariff on nuts, which, in practice, prevented their entry into that market.