Chilean blueberry importers expect strong demand

10/27/2010 04:51:48 PM
Andy Nelson

Despite a crop expected to be in the 65,000-ton range, 30% more than last season, importers of Chilean blueberries expect strong demand and brisk movement.

“Demand should be strong, because the increase in promotable volumes should drive sales at retail,” said Joe Barsi, director of business development for Watsonville, Calif.-based California Giant Inc.

Blueberry prices will likely stay high through October before volume shipments begin arriving in time for the holidays, Barsi said.

“There should be decent volumes out of Argentina for Thanksgiving and out of Chile for Christmas,” he said. “There will be opportunities to promote during those holidays, and barring any weather issues, there should be no major supply gaps between Argentina and Chile.”

Despite China opening its doors to Chilean blueberries for the first time this season, Barsi does not expect a significant chunk normally slated for the U.S. to wind up in export markets other than the U.S.

“Due to the increase in volumes, I don’t think exports to China and other countries will cannibalize the U.S. volumes,” he said. “The United States is still the most important market for the Chilean blueberry industry.”

Demand grows with supplies

Expected higher volumes and an early start should mean that Vancouver, British Columbia-based The Oppenheimer Group will be able to take full advantage of winter holiday promotional opportunities in late December, said Nolan Quinn, the company’s berry category director.

“There should be promotable product from late December to mid-February,” Quinn said.

Oppenheimer expects its first shipments of blueberries from Chile the first week of December, a week or two earlier than usual, he said.

Quinn expects demand for Chilean blues to be “fair to good” all season, despite expected larger volumes not only from Chile but from Argentina, which overlaps Chile for a significant chunk of its deal.

Consumer demand for blueberries, Quinn said, continues to grow right along with supplies.

One factor that won’t likely affect demand for Chilean blueberries this year, but could in the future, is increased blueberry acreage in Mexico, Quinn said.

“Production is up a lot in Mexico,” he said. “They’re definitely still a small player, and it’s not enough to make an impact this year, but in maybe three to five years, they definitely could be a bigger player.”

A delay in the Chilean deal could wind up being a good thing for markets, said Jim Roberts, vice president of sales for Naples, Fla.-based Naturipe Farms LLC.

“Just as Argentina and Uruguay are finishing up, Chile will start peaking,” he said. “It will be more of a seamless flow.”

Roberts also expected a 25% to 30% increase in volumes industrywide, an increase that would likely be mirrored by Naturipe’s volumes from Chile.

A late start to the Chilean deal due to cool weather — all three regions were set to begin about seven to 10 days later than normal — could mean that at some point in the deal, volumes could surge to catch up, said Bob Ritchart, vice president of sales for Tampa, Fla.-based Sun Valley International.

That scenario is more likely than another, in which the deal would last beyond its typical mid-January end date, Ritchart said.

That said, Ritchart doesn’t expect a glut that will slow demand for Chilean blueberries this season.

In fact, volume shipments could still begin arriving in time to take advantage of Thanksgiving pull, Ritchart said, though he’s not banking on it.

“It will be close,” he said. “It’s like strawberries out of Florida for Christmas. You either hit it or you don’t.”

Fall import blueberry prices would likely hold up through the week of Oct. 18, then start to come down by the first week of November to levels where chains could begin promoting, Ritchart predicted.

The beginning of the Chilean season overlaps with the middle to end of the Argentina season in November, said John Johnston, director of blueberry product management for Watsonville-based Driscoll Strawberry Associates Inc.

However, he said, Chilean volumes aren’t likely to ramp up until early to mid-December, so the chances of a substantial overlap are slim.

As a result, Driscoll anticipates brisk movement.

“We expect strong demand throughout the Chile season and especially during the peak in January,” Johnston said.

Higher volumes

Chilean volumes will likely be up significantly this season, as much as 15%, said Dave Bowe, owner of Coral Springs, Fla.-based Dave's Specialty Imports Inc.

Although growers in Argentina, whose November-January deal largely overlaps Chile’s, have been cutting acreage in recent years because of low margins, production in Argentina should be up this year.

But blueberry demand has continued strong, and despite those expected higher volumes, Bowe doesn’t anticipate anything other than brisk movement.

“If the weather’s good, they should have an excellent time for their period,” he said.

Prices for boxes of pint-size containers could go as low $19 f.o.b. for shippers with particularly heavy volumes, but for the most part, Bowe expected prices for Chilean blues in the $22-23 range this season.

Washington, D.C.-based Sun Belle Inc. expects a possible volume increase of 90% from Chile this season, but the company’s president, Janice Honigberg, isn’t worried about finding the demand to meet that supply.

With peak volumes not expected until January because of cool fall weather in Chile, Honigberg said vessel shipments, for the most part, would miss the winter holidays.

But Sun Belle plans to import heavily by air in December to meet holiday demand.

In the future, Mexico will likely play more of a role in demand for Chilean and other import berries during the winter months, Honigberg said.

Sun Belle is working with researchers at the University of Georgia on varieties for planting in Mexico, Honigberg said.

“There’s quite a bit of acreage planned for Mexico,” she said.

The Mexican deal this year is expected to begin in mid-November and end about the beginning of May, Honigberg said.



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