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Bananas from Ecuador in Asia to stay?

Asian consumers really like Ecuadorian bananas, which is why the country’s exporters forecast that these quantities will be repeated for 2015 and 2016, or even increased slightly up to 17 million boxes.

Weather problems in the Philippines in 2014 created opportunities in the Asian market that Ecuador’s banana exporters hope will endure.

Ecuador has always exported to Asia. But until now, only insignificant volumes were being shipped, because even though the quality of Ecuadorian produce was better than the local supply, the shippers could easily be priced out of business. Year-end figures for 2013 showed exports of just 3 million crates. But in 2014, the Philippines had weather problems and was unable to supply its market share, leaving the window open for Ecuadorian operators to export an impressive 16 million boxes.

Asian consumers really like Ecuadorian bananas, which is why the country’s exporters forecast that these quantities will be repeated for 2015 and 2016, or even increased slightly up to 17 million boxes. Even when Philippine fruit comes back onto the market, it seems likely that Asian consumers will continue to appreciate the good prices and high quality of bananas from Ecuador. But this all remains to be seen, depending on market stability.

For Ecuador, last year 2015 was unusual, with constantly low prices. Historically, the campaign is split into two periods: high prices and low prices. Annual report graphs outlined how one season and the high-priced period minimised the losses that occurred during the low price periods. When doing the books, it was usually considered a “good” season. Nevertheless, in 2015 the price of Ecuadorian banana suffered no periods of variation, and instead remained stable. This new model gave rise to concern and uncertainty in the sector, with exports to Asia most likely to suffer.

LH

This article appeared on page 80 in the News section of edition 141, Jan/Feb 2016, of Eurofresh Distribution magazine. Read that issue online here.

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US exhibitors report $6.8 million in projected sales from Asia Fruit Logistica

13 U.S. exhibitors reported over $1 million in onsite sales and $6.8 million in projected sales following a successful Asia Fruit Logistica 2015 in Hong Kong.

Over $1 million in onsite sales and $6.8 million in projected sales have been reported by the 13 US exhibitors at this year’s Asia Fruit Logistica, held September 2-4 in Hong Kong.

The USDA said the event, a USDA-endorsed show, is Hong Kong’s largest specialised trade show for agricultural produce. “This year, more than 570 companies from 40 countries/regions exhibited products to over 9,200 Hong Kong based and regional buyers.”

Among the support provided to leverage US exhibitors’ market opportunities, the US Agricultural Trade Office (ATO) Hong Kong organised a market tour, provided a market briefing and hosted a trade reception for more than 80 invitees . “As a result, U.S. exhibitors secured excellent export opportunities, achieving on-site sales of over US$1 million and projected sales in the next 12 months of over US$6.8 million,” the USDA has reported.

In 2014, the US was the largest supplier of fruit, vegetable and tree nut products to Hong Kong, with exports valued over $485 million, $30 million and $889 million, respectively. Hong Kong also serves as a gateway for the flow of products to regional markets with strong logistical access to Asian-based buyers and markets, it said.

Image of Hong Kong night skyline by Base64, retouched by CarolSpears (Own work) [CC BY-SA 3.0 (http://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia Commons

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Asia: Still much greater things to come

Asia will be the standout growth opportunity for the global fresh produce trade in the next decade, and its ever-increasing demand is set to have a much greater influence on world suppliers and markets.

Asia’s impressive rise as a fresh fruit importer has been impressive over the last two decades, as highlighted at the latest Asiafruit Congress.

Asia will be the standout growth opportunity for the global fresh produce trade in the next decade, and its ever-increasing demand is set to have a much greater influence on world suppliers and markets.

That was one of the key messages left ringing in the ears of delegates to the last Asiafruit Congress in Hong Kong, which attracted close to 350 industry decision makers from 34 different countries, celebrating its 20th Anniversary.

Panelist John Piper, founder of Hong Kong-based Food Asia Marketing, agreed, suggesting the fruit trade would continue to grow despite recent concerns about an economic slowdown in Asia. “Despite previous global economic dips, Asia has seemed to sail through,” he said. “In Asia, fruit imports are a luxury, but they’re a little luxury that people can afford and will continue to pay for.”

Nick Kukulan, president of Paramount Export Co, was also upbeat, noting that appreciation of fruit and vegetables in Asia, particularly for their taste and aesthetic qualities, was “unmatched” in any other part of the world. “Asian consumers have been a driving force for development of varieties in the US, whether it be with white-flesh peaches or grapes; it’s an incredible place to do business if you follow what consumers want in terms of taste and texture.”

More stimuli for growth, despite recent financial “correction”

Geoff Green, head of Capespan Global Procurement, shared his first-hand insights into the impact on the global supply base, particularly for Southern Hemisphere suppliers who have been shipping much more of their produce to Asia to meet counter-seasonal demand.

“Asia seems to be the only thing on growers’ minds now, whether it’s in Peru, Chile, South Africa or India,” said Green. “With everything being planted, the only thing on the growers’ minds is the Asian markets. They’re no longer planting varieties as they did before for Europe and the UK.”

While acknowledging that China’s economy was undergoing “a long overdue correction”, Piper urged everyone to keep ‘the bigger picture’ in sight. Looking to the next ten years, he said the challenge would not be to grow the market for fresh produce imports in Asia, but rather to keep pace with demand.

Marketing health: a ‘capitalist’ opportunity

Clint Smith of The Silk Initiative and Zhongxing Zhang of McCann Health explained how marketing the health and nutritional benefits of fresh produce in Asia could deliver sales growth.

Smith said Chinese consumers are very conscious about the heating and cooling properties of foods as well as their natural medicinal properties. “It’s about keeping a balance between heating and cooling properties,” he explained. “There’s also much work to be done to educate consumers on less familiar fruit and vegetables.” “Most of us know avocados are very nutritious but when they first came to China, people didn’t like them,” said Smith.

Zhang followed on from Smith’s advice, urging delegates not to be so modest when it comes to promoting the health benefits of fruit. “Let consumers see the link between fruit and its health benefits,” Zhang said. “Communication needs to be changed; nobody has told consumers the health aspects of each specific fruit.”

China’s banana market: opportunities in Southeast Asia

Goodfarmer’s Liu Zijie painted a picture of the opportunity to develop China’s banana market with perspectives for domestic production. Vanessa Perez of Austrade Philippines and Edgar Fernandez from the Philippines retailer Rustan Supercenters outlined the market opportunities in this rapidly emerging South East Asian economy. James Christie of US-based market development agency Bryant Christie also led a breakout session on the changing landscape in terms of maximum residue levels across Asian countries, with expert insights from colleague Matt Lantz and from John Chapple of Hunter Food and Agriculture Services.

China & Taiwan: huge markets for NZ cherries

Taiwan and China are the main two markets for NZ Cherry Corp with approximately 60% of its volume going to these two markets. Chinese customers seek big, red, firm and juicy cherries, it reports. “We believe we have the best quality from NZ and are in a good position to provide the size, quality and packing the customers need. We harvested 510 tons this year and we expect a better season for the coming year, thanks to an increasing number of growers in our company. We are currently working on some projects to increase our production quantity.”

Asia: a growing opportunity for Indian produce too

Asia is also giving growing market opportunities for Indian produce. One of its top 7 exporters, Seven Stars Fruit, confirms they are already exporting to Hong Kong, Malaysia, Singapore and the ME market too, though their main export market is Europe, especially the UK and Germany. “This is our 2nd time at AFL. We are here to find new opportunities for grapes, pomegranates and onions in South East Asia. This year, we have also started a banana plantation of 35 ha to get year-round production and we expect the first harvest in April 2016,” say their managers.

Seven Stars Fruit is a major exporter of Indian fruit, especially pomegranates, table grapes, mangoes and bananas, and they are looking for opportunities in onions and potatoes in the Far East and Russian. Last year, Seven Stars Fruit exported table grapes from a total production area of 1,200 ha, and pomegranates from an area of 200 ha. Seven Stars works closely with growers and has developed the web app “Farm View” for growers, the production team and their customers, which will help to monitor production on the farms, packing operations and traceability for their customers. This will ensure monitoring of pesticide residues and food safety, which are major concerns for the EU market.

SM

This interview first appeared on p38-39 of edition 139 (Sept/Oct 2015) of Eurofresh Distribution magazine. Read more of that issue online by clicking on the image of it here:

 

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Japan plans fully robotic lettuce farm by 2017

Capable of supplying 30,000 heads of lettuce a day, Japanes company Spread says its 4,800m2 ‘large-scale vegetable factory’ will be “fully automated from seeding to harvest.”

Kyoto-based firm Spread plans to open what has been dubbed the world’s first fully robotic farm.

Capable of supplying 30,000 heads of lettuce a day, the company says its 4,800m2 ‘large-scale vegetable factory’ will be “fully automated from seeding to harvest.” This complete automation of the cultivation process will slash labour costs in half, it said in a press release.

Focused on global expansion, Spread hopes to extend its production to 500,000 heads of lettuce per day in five years “and will continue to expand our vegetable factory business domestically and internationally.”

Founded in 2006, in Kameoka in Kyoto, Spread already operates what it calls the world’s largest vegetable factory using artificial lighting, which grows four types of lettuce for a total 21,000 heads per day. It provides year-round supply to about 2,000 stores in the Tokyo metropolitan area and the Kansai region via the brand “Vegetus”.

Spread produces several types of lettuce under the brand name “Vegetus” (its brand for vegetables cultivated in its vegetable factories) and says it sells them to department stores, major grocery stores, hotels, restaurant, and amusement parks around Japan.

Construction of the vertical farm – at a full investment of up to about 2 million yen (€14.6m) – is due to start in Kizugawa, Kyoto, next spring with the first shipments in summer 2017. From the estimated production capacity of 10 million heads of lettuce a year, Spread estimates annual sales of about 1 million yen.

Environmentally friendly features of the ‘next-generation’ factory are to include recycling of 98% of the water used for cultivation and a system of environmental control making the factory extremely energy efficient.

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Record attendance at Asia Fruit Logistica

More than 9,200 trade visitors from 70 different countries attended Asia Fruit Logistica at Hong Kong’s AsiaWorld-Expo Center from September 2-4. Organisers said a significant increase in visitors from Asia drove the record attendance at the International Trade Fair for Fruit and Vegetable Marketing in Asia. Total visitor numbers rose by 14% on last year’s event, and 66% of those visitors came from Asia, up from 58% in 2014.

More than 9,200 trade visitors from 70 different countries attended Asia Fruit Logistica at Hong Kong’s AsiaWorld-Expo Center from September 2-4.

Organisers said a significant increase in visitors from Asia drove the record attendance at the International Trade Fair for Fruit and Vegetable Marketing in Asia. Total visitor numbers rose by 14% on last year’s event, and 66% of those visitors came from Asia, up from 58% in 2014.

“These results demonstrate the further strong interest and engagement in Asia Fruit Logistica from trade professionals across Asia,” said Gérald Lamusse, managing director of Global Produce Events (GPE).

“They underline Asia Fruit Logistica’s position as the unique pan-Asian event for this business, which also attracts unparalleled attention globally from leading buyers and suppliers.”

China was by far the biggest country represented in terms of attendance, accounting for more than a third of total visitor numbers. Australia and the US ranked second and third respectively, and they were joined by India, Taiwan, Malaysia and Singapore as the strongest of the 70 visiting nations.

The exhibition space for this year’s show expanded by a third. More than 570 companies from 40 different countries showcased their products and services at the event, up 20% on 2014.

China was also the single largest country in terms of exhibitor numbers, with 105 companies exhibiting. Lamusse said Italy cemented its position as second-largest exhibiting country, with 54 companies taking part,  up 39% on last year. Egypt moved up into third place with 36 exhibitors, the US edged into fourth (31 exhibitors), while Australia and the Netherlands shared fifth spot with 30 exhibitors each.

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Italian exporters strengthen their ties in Asia

Italian fruit exports to China, Indonesia, Taiwan, India, Hong Kong, Singapore and Malaysia are on the rise.

Italian fruit exports to China, Indonesia, Taiwan, India, Hong Kong, Singapore and Malaysia are on the rise.

Italian apples, pears and kiwis have an increasingly bigger share in far Eastern countries. In apples, the 2014 campaign ended with 3,733 tons exported to these markets, 50% more than in 2013. Exports to India also rose significantly, totalling 2,520 tons in December 2014, 45% more than the previous campaign. Similar results were reported for Hong Kong, which quadrupled the volume of apples imported from Italy, and Singapore, which ended 2014 with an increase of 45%, equivalent to 444 and 489 tons, respectively. Pear exports, although less important in terms of volume, reached 105 tons this January, up 200% on the previous campaign, specifically to Indonesia and Singapore.

Finally, Italian kiwi exported to Asian markets totalled 19,787 tons in early 2015, a slight drop compared to the 2013 campaign. Although the most representative country is China, with 8,230 tons, the most striking figure is the increase in the kiwifruit share in Taiwan, which grew by almost 50%. The third largest market is India, followed by Hong Kong, Singapore and Malaysia. For apples and kiwis, an upward trend is highlighted in the Indian market, which is emerging as a great prospect for Italian fruit.

Source: CSO

GO

(Image: By Fred the Oyster (Own work) [CC BY-SA 3.0 (http://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia Commons)

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How Australia is tapping fresh produce opportunities in China

"Australia is in quite a nice position to be able to segment the market by focussing on being a niche market player rather than getting caught up against the big volume suppliers."

The importance of suppliers building long term trade relationships with China and adapting to its customers’ tastes was recently stressed by Loren Zhao, co-founder of the country’s rapidly-expanding online fruit retailer, Fruitday.

Speaking as part of the London Produce Show breakfast panel, Zhao singled out Australia and New Zealand as countries doing a good job in this regard. He said that in the future, China “will be consuming most of the global produce” and he said it is looking to these suppliers, which he said are already focusing on India and China. “It’s very important to grow products with the Chinese customer in mind.”

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Zhao said the US and Australia are spending a lot of money in order to change their fruit varieties and grow newer ones in response to demand from Chinese customers. “We see that they also want to invest for the market for us.”

“A lot of exporters just want to trade and they want to sell everything to China but other exporters want to cooperate…like Zespri and Sunkist,” he added.

Promising export future: Australian table grapes and citrus

Speaking to ED at the London show, PMA Australia-New Zealand CEO Michael Worthington said table grapes are a good example of where Australian growers are adapting to Chinese tastes.

“Australia is producing a lot of very good quality red and black grapes which the Chinese love. Crimson seedless has been a very successful variety, because it’s obviously seedless but it also has good Brix. There are some black grapes coming on to the market that have got a very high brix, so very much going for sweetness, which suits the Chinese palate,” he said

The Chinese very much buy on colour and a sweet taste, so I think Australia is in quite a nice position to be able to segment the market by focussing on being a niche market player rather than getting caught up against the big volume suppliers such as Chile” he said.

“On the citrus side, the Australian navel quality is very good – probably the best in the market – and well-recognised in China, and some of the mandarins that Australia is now producing also fit in very well with Chinese consumers because of their good colour and flavour.”

Screenshot 2015-07-07 at 12.28.29.png

“Another real positive is that grapes and citrus fit very well with online sales – you can make nice convenience packs of table grapes. And with online sales booming in China, this is a great area for a niche marketer such as Australia to supply.”

Aussie Cherries also popular in China

Tasmanian cherries provide another example of Australian fresh produce fitting very well with Chinese tastes, Worthington said. “Tasmanian cherries tend to be larger size, very high quality and coming from grower-marketers of a small enough scale that they can go very niche as opposed to being a mass supplier that’s always trying to shift big volumes.”

Hopes FTA will see new protocols expedited

Worthington said it’s hoped the recently signed free trade agreement between China and Australia will speed up quarantine protocols allowing more fruit varieties to be traded between the countries.

“There’s a number in the pipeline both ways, such as stonefruit from mainland Australia and I am confident that as direct trade builds up (as opposed to the traditional “grey channel” supply into China via Hong Kong), we will see more vegetable lines, such as broccoli and carrots, and products such as mangoes and avocadoes exported out of Australia.”

Efficient distribution: key to success in e-retail

On online sales, he said China is doing very well in its ability to get the produce to consumers. “I think in a lot of other countries, particularly western ones, that last mile of logistics is the biggest challenge to growing online sales, whereas in China they’ve got these multiple small distributors on motorbikes and bikes and everything else that can get the product to the consumer.

“It’s a mixture of finding the right product, that is of a high enough value, matched with a distribution system that’s very much more efficient, as opposed to trying to look at it just purely as a price point and keeping the cost of an online sale at or below what you’d pay if buying in a supermarket,” he said.

 

Relief map of Australia by Hans Braxmeier (http://www.maps-for-free.com/) [CC BY-SA 2.5 (http://creativecommons.org/licenses/by-sa/2.5)], via Wikimedia Commons

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Opening new Asian markets a priority for Spanish exporters

Entering new markets in China and other Asian countries such as Thailand, Taiwan, Vietnam and South Korea a priorities for Spanish fresh produce exporters.

China and other Asian countries such as Thailand, Taiwan, Vietnam and South Korea are priorities for negotiations to open up new markets, says Spain’s exporter federation Fepex.

But at a meeting of its Working Group on Fruit and Vegetables in Madrid this week – to discuss an Internationalization plan – product-country specific protocols with contain very strict phytosanitary requirements were identified as the main barrier faced by fruit and vegetable producers and exporters.

Meanwhile, attendees were informed that that a proposed protocol with China for the export of peaches and plums from Spain is currently being assessed by the Chinese authorities.

 

Read Fepex’s report on the meeting in Spanish.