While Chile's blueberry industry has been able to overcome the heightened requirements for some fruit growing regions, one major producer says the most dramatic consequence is the negative effect on organic production.

Ruy Barbosa (left) and the North Bay Produce team at PMA Fruittrade Latin America.

In December last year, the U.S. Department of Agriculture (USDA) announced blueberry exports from three important growing regions in the South American country would need to be fumigated at origin, due to detections of European Grapevine Moth (Lobesia botrana).

At last week's Produce Marketing Association (PMA) Fruittrade Latin America event, a representative of international grower-owned company North Bay Produce told www.freshfruitportal.com the new requirements meant growing organic was no longer worth it for some.

"There are many producers for whom organic production is more costly and less productive than conventional, and the new costs these measures imply mean profitability for them has really gone down," Chile manger Ruy Barbosa said.

"Today they have to work with higher costs but end up with the same prices of the conventional fruit - I would say that's the worst aspect of the Lobesia Botrana issue."

He added the biggest concentration of organic fruit was in the VI (O'Higgins), VII (Maule) and VIII (Bio Bio) regions, all of which were affected by the fumigation measures.

Chilean exporters in these areas can still send their fresh blueberries to Europe and Asia without the need for fumigation.

While the fresh organic sector is experiencing some challenges, Barbosa said the organic processed sector was faced with no such problems, and growers were in fact receiving more than double the price paid for conventional processed blueberries.

A positive aspect coming from the USDA's fumigation requirements, however, is that it now takes less time for the fruit to arrive in the U.S. after being harvested.

Barbosa explained that previously, samples needed to be taken in the warehouses and sent off for evaluation - a process which could take up to three days. Nowadays, the fruit could be shipped immediately after fumigation.

A lot of effort into Asia

North Bay Produce also exports Chilean blueberries to Europe, and company representatives said the strict supermarket rules compared to the U.S. regarding minimum residue levels meant the organization's supply chain and production had reached new levels of sophistication and dynamism.

Chilean blueberries are also shipped to Asia via the company's distribution center next to the St. Louis airport in Missouri.

Although Asia-bound blueberry exports are relatively low, Barbosa said one of North Bay's key points of focus was on ramping up trade.

"We're putting a lot of work into Asia, and especially the likes of China and South Korea," he said.

"We have someone in the company who is specifically in charge of that market. They travel four times a year for a month to Asia visiting clients, looking for new distribution channels and getting to know the market better."

Lack of Chilean uniformity

The U.S. remains the company's strongest market for North Bay's Chilean blueberries, and 95% of the fruit is sold to supermarkets.

With around 15% growth in export volume forecast for this season, Barbosa said a lot of energy was being put into optimizing quality.

Retail chains selling the Chilean blueberries include Walmart, Kroger, Safeway and Supervalu.

"Selling such a high percentage to supermarkets means we have a big responsibility with regards to the quality of our fruit, and the fruit that our exporters send to them," Barbosa said.

"We need to be careful about the market prices - Chile is producing a lot of fruit and it's clear there's a lot of fruit being sent to the United States, and it is all of varying quality.

"Therefore whoever can achieve a really good fruit quality is going to be way ahead of the rest. Because of that this year we're being as responsible as possible with our fruit and really looking after that quality."

North Bay Produce has a significant operation in Chile working with 23 exporters to fulfill its Asian, U.S and European programs, but the Chile manager mentioned it was at times challenging to achieve blueberry uniformity due to the large number of producers growing and packing their own fruit.

"What this means is every producer can apply their own criteria," Barbosa said.

"Supposedly everyone operates under the same rules regarding packaging and quality so everyone's more or less similar, but the fact that growers pack their own fruit means there are almost as many different qualities as there are producers.

"This is a bit of a problem so we have to be careful and make everyone conscious of this."

www.freshfruitportal.com