The cherry season in Chile has been marked by a significant increase in production and a drop in prices. There has been an oversupply in the Chinese market, the destination of 95% of Chilean cherry production, which strongly impacted the sector's profitability.
"This year, Chilean cherry production was estimated to increase by 50-60% at the industry level, which could partly explain the complex situation that the Asian market is currently experiencing," stated Pablo Bravo, Frusan's market manager.
"In addition to this, there was a critical logistical issue as a ship with 1,300 containers of cherries wasn't able to arrive in time for the Chinese New Year, which could lead to huge losses. We are still evaluating what to do. We have already notified the insurers, but it is a challenge because cherries have a limited shelf life," Bravo stated. The fruit should have arrived on January 20, but its delay could further affect an already saturated market."
"To face this situation, we have been exploring new markets to avoid excessive dependence on China. This is a turning point for the industry. We are now looking at India, the Middle East, Europe, and the US as alternatives," Bravo stated. However, he acknowledged that the transition won't be easy, as these markets currently can't absorb so much volume.
"The European market, for example, traditionally consumes cherries before Christmas and New Year in a limited way. If we even try to redirect 5% of our production to this region, we could collapse the market," he warned.
With more than 45 years in the sector, Frusan also exports apples, kiwis, grapes, plums, blueberries, asparagus, and mandarins, with production in Chile and Peru. They grow approximately 50% of the products they market, while the rest comes from allied producers.
"There is constant work to maintain quality standards throughout the entire production chain, seeking to optimize resource management, such as water use and the products we apply." In addition, the company maintains long-term business relationships with customers in different markets, betting on trust and consistency in product quality," Bravo stressed.
"We must adapt to new market conditions and diversify our destinations. It won't be easy, but it's what we must do," Bravo concluded.
For more information:
Pablo Bravo
Frusan
Av. Presidente Riesco 5561, of. 1301. Las Condes
Santiago de Chile
Tel.: +56 2 2657 3300
Email: frusan@frusan.cl
www.frusan.cl