Chile's fruit sector assesses uneven impact of frosts

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Chile's fruit sector assesses uneven impact of frosts

Farmer Antonio Hoces describes frosts as being much like earthquakes - unpredictable events with unpredictable effects.

"Frosts are a strange thing. They are like an earthquake. They jump around. In some sectors, everything is affected and in another, nothing is affected," he says from his farm, Agrícola San Antonio, near Rengo, Chile - a seismic place befitting of the metaphor.

Healthy cherries at Agrícola San Antonio that survived Chile's extensive frosts

Healthy cherries at Agrícola San Antonio that survived Chile's extensive frosts

The O'Higgins Region, where Hoces operates, suffered some of the worst damage of the seven separate frosts that struck Chilean producers from mid-September to early October. Assessments have been worrying for the industry with current estimates placing the nation's fruit exports at almost a quarter loss.

Despite the greater picture, however, Hoces points out that not all hope is lost. Devastation for one crop or one farmer does not necessarily mean devastation for the next, he explains.

Walking through Hoces' 120-hectare property with distributor Terrafrut, the evidence of the frosts' uneven effect becomes clear. Next to a desolate kiwifruit orchard, workers keep busy thinning cherries from trees teeming with fruit.

To see more from our visit of Agrícola San Antonio, visit our photo gallery. For more information on Chile's frosts, visit our tag page, Frostschile2013.

"For cherries, there wasn't any problem. You see that all the fruit is there. One degree below zero for this species, versus that one, the kiwifruit, isn't the same. That species lost everything. You wonder how, when they are right next to each other," he tells www.freshfruitportal.com.

If the season continues well, Hoces will have healthy cherries and nectarines to offer to his buyers in Asia, North America and Europe. Although these crops suffered minor damages as well, their fruit withheld the cold and continue to grow on the trees.

A nectarine pit shows small signs of damage from the frosts

A nectarine pit shows small signs of damage from the frosts

He points out, however, that exporters must have caution and refrain from overwhelming markets with low quality fruit as compensation for poor volume.

"The worst that we can do is think that because we have little fruit that we are going to send everything to market. The market isn't like that. It will punish you anyway. The market wants high quality fruit," he says.

The quality issue comes into play for his remaining kiwifruit and Thompson grapes, both of which suffered extensive damage. Although these crops could come back with a second budding, Hoces must evaluate if the fruit will have the quality or volume to compete internationally.

"We are going to have to play the markets and get a lot of information from exporters to see how the price goes. If Italy comes in with a lot of kiwifruit and New Zealand comes in with a lot of kiwifruit, for us it would be better to stay here and do nothing," he says.

"I think if international markets show drops, we can start to play to see what percentage we could offer. Our competitor is New Zealand. If New Zealand has little kiwifruit, that could be advantageous."

Given low prices on the domestic market, he explains that it will not be worth the price to harvest if the kiwifruit stays local.

Antonio Hoces in a largely devastated kiwifruit orchard

Antonio Hoces in a largely devastated kiwifruit orchard

Either the fruit must meet criteria for export or it will stay on the vine.

Overall, he expects about a 50% drop in the company's kiwifruit export volume.

For his Thompson grapes, the situation is similar. The vines show extensive damage and inconsistent development that will make management difficult. If this plot does not bear significant fruit in the second budding, the remaining fruit will likely go to white wine production.

"Management is going to be very complicated in the sense we have branches at 8, 10 centimeters and others that haven't even sprouted yet. This grape requires a lot hormones for thinning and growth. How are we going to apply those when some grapes are ready for thinning and others are still growing?" he says.

The precarious situation of certain crops shows the value of diversity. As Hoces puts it, the frosts demonstrate the old saying, "don't put all of your eggs in one basket."

"If we’d only had kiwifruit, we’d have the door locked with a key. There’d be nothing left to do," he says.

Hoces will have fruit, however, as noted by his healthy, although diminshed, cherry and nectarine trees.

On the export end

At Terrafrut, the export company that sources Hoces' fruit, the frosts have encouraged the need for diversity as well.

From the company's main office in Rengo, general manager Alvaro Larrondo explains that the company will be developing a number of product categories to supplement volume.

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Nectarines that could form part of Terrafrut's export offer

"Since apples haven't been as damaged, we are going to strengthen our apple program and pears also. We are also developing the topic of frozen products as a new area of business, as well as raisins," Larrondo says.

"We'll also have a lot of fruit for the internal market. We want to take advantage of new opportunities and look at the positive side. We are focused on quality development in the business. That's our mission, to provide quality fruit."

The company expects to have around 60,000 boxes of apples and pears for export.

Commercial manager Alejandro Rojas adds that the company will also look to source greater volumes of non-traditional fruits.

"Along with this development strategy, we also have a line of exotic fruits. These exotic fruits could be persimmon, pomegranates or quince, which for Terrafrut are exotic. These would be mainly for the U.S. market," Rojas says.

For Terrafrut's standard fruit categories, the company says it has observed 10-15% damage for cherries, about 15% damage for nectarines, up to 20% damage for grapes and over 50% damage for kiwifruit.

"In general, we hope to have around 15,000-20,000 boxes of cherries. For nectarines for the Far East, we hope to send 100,000 boxes if the drop is not very large. For yellow-skin nectarines, we hope to send around 40,000 boxes to markets in Europe, the U.S. and Latin America," Larrondo says.

"It's good at the very least, to establish the message that we are going to have this fruit."

Larrondo estimates that the most affected volumes will be for kiwifruit and plums, which will require further assessments to establish volume estimates.

Looking for political answers

A repeated message both on the farm and back in the office is the frustration felt by an industry that feels largely abandoned by its policymakers.

"My only hope as a farmer is that from this tremendous crisis, the Chilean state realizes the magnitude this sector has for the country, the number of people it involves and the millions of dollars that it moves," Hoces says.

"I think the same thing is going to happen as always. Farmers are going to have to fix this ourselves, through the good and the bad. The only thing I ask is that they don't bother me in the good times or the bad times. Since they have never helped me in the bad times, I don't want them to bother me when things are good.

"No one from the state has come to ask me anything [about my farm] and they aren't going to come either."

A major frustration of this industry lies in its natural vulnerability as a provider of perishable goods and the perception that government actors have not provided adequate protection in the past.

"An important message to transmit, including to our nation's authorities, is that in our industry, our producers work all year for one harvest. Our exporters are specialized in shipping to all of the world's markets. We need strong legislation to protect this industry that should be considered an important industry in Chile," Larrondo says.

"It is the top employer of manual labor in Chile and we can't let happen again what happened with the port strike in the middle of the cherry and grape harvest. Last season we had the grapes stored for three weeks in cold storage. These are susceptible fruits and we need protection."

Rojas seconds Larrondo's sentiment, explaining the importance of the fresh sector in Chile's overall economy.

"Fresh fruit is a strategic industry for the country. It is the third largest producer of income but it is very vulnerable. We are tremendously vulnerable due to lack of legislation, lack of government decisions," Rojas says.

"The fresh fruit industry has a large multiplying effect. A producer like Antonio Hoces generates work. There are families that depend on that. We also involve other industries like transport, insurance. A lot of industries move due to the fresh fruit industry. But none of those are properly covered for something like a freeze."

www.freshfruitportal.com

 

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