Climate change has been a major challenge for Brazil's agricultural production. "Last year we had a drought that lasted more than seven months, the longest in 90 years. Now it's raining too much, which makes it difficult to harvest limes," stated Sérgio Negrão, CEO of Jagrao Brazil, a company that has been marketing Tahiti limes and ginger for almost 14 years. With approximately 100,000 lime trees in the state of São Paulo, the company also works with producers in Mexico. Last year, it exported 430 containers of limes and 40 to 50 containers of ginger.
Producers have had to invest in costly solutions, such as drilling deeper wells to ensure irrigation, to cope with these extreme weather conditions. However, excessive rainfall also complicates harvesting, affecting the quality and availability of the product in international markets.
In addition to climate challenges, the sector is struggling with logistical issues. "Shipping companies are not adhering to agreed delivery times. In the port of London, for example, there are delays of up to 40 days," Negrão stated. These delays increase operational costs and jeopardize the freshness of the products.
When it comes to limes, Mexico is Brazil's biggest competitor. However, Mexico focuses mainly on the US market, which creates opportunities for Brazilian exporters in Europe and other regions. "Phytosanitary restrictions prevent Brazil from exporting limes to the US," Negrão said. However, he suspects that this has more to do with trade interests than with health requirements. "If Brazil were to enter the US market, many people in Mexico could lose their jobs."
"The average price of Brazilian lemon was 8 euros per 4.5 kilo box. This means that, despite the climatic and logistical difficulties, the market remains stable," he added.
The situation is different for ginger. "At the moment, China dominates the ginger market because they are in the middle of their harvest season and can export by sea. In contrast, Brazil is harvesting baby ginger, which can only be transported by plane due to its thin skin. As such, it is an expensive product. Chinese ginger is cheaper, so it's difficult to compete on price," Negrão said.
The price of Brazilian ginger fluctuated between 30 and 40 euros per 14-kilo box, with an average of 32 euros. However, Negrão stressed that, despite the good prices, production costs in Brazil increased significantly, affecting the producers' profitability.
However, Brazil has an important advantage: a strong domestic market. "With 220 million inhabitants, we can select the best products for export. Other countries without such a strong domestic market have less room for maneuver," Negrão said.
"We are working to strengthen our trade relations and adapt to new market trends. Trade shows are not just for doing business, they also help us understand what our customers need and how we can improve. We are used to setbacks. We have weathered COVID-19 and other crises. We are still here, working hard to make everything work," Negrão concluded.
For more information:
Sérgio Negrão
Jagrao Brazil
Tel: +55 169 960 99462
Email: sergio@jagraobrazil.com
www.jagraobrazil.com