New Zealand's largest fruit and vegetable exporter is gearing up for its first harvest of Peruvian table grapes, marking a milestone for the long-established company that has until now been solely focused on trading the fruit from partner growers.

T&G Global, formally known as Turners and Growers, will next month begin harvesting and exporting table grapes grown in Peru's Piura region, following the purchase of 340 hectares of farmland in 2013. 

The purchase forms part of its new strategy centered on becoming a vertically integrated grower, marketer and exporter in key produce categories.

Predominantly seedless varieties are due to be planted over 200 hectares by the end of 2017, after which T&G will assess whether to plant more grapes on the remaining hectarage or even trial another crop.

Speaking to www.freshfruitportal.com, grape category general manager Nick Fitzpatrick said T&G had been operating out of Peru for more than a decade, and after opening an office in Lima in 2007 it became clear there was an opportunity in the industry.

"What we felt was not being fully realized was the opportunity around seedless grapes. For the growers and packers in Peru growing seedless their fruit was four or five times oversold," he said.

"We also realized we’re not going to be able to grow unless we have some underpinning volume to our own trading business.

"BayWa became majority shareholders in 2012 there was a change of strategy and a new international focus to the business. They were very supportive of our South America focus and after pitching the business case the board shared our vision to develop our own farm in a country that continues to see strong investment in agriculture."

T&G had teamed up with Chile's Unifrutti to work on the Peruvian operation, but the joint-venture was later discontinued. Fitzpatrick explained it had not been the right time for Unifrutti, partly as it was having to rebuild a farm in northern Chile following flooding in the region.

"They had to reprioritize their capital expenditure, but we maintain a very good relationship and continue to work with Unifrutti as a trading business," he said.

While T&G sources grapes from many key growing regions, including Australia, Chile, Peru, South Africa and California, Fitzpatrick said this was very much its 'virgin production project' outside of New Zealand.

"This project in Peru is our first foray into being growers and packers outside New Zealand, so that volume will go into our global trading business and hopefully this will open the doors to look at new projects as well," Fitzpatrick said.

He said while the company could have invested in production in a more developed country such as the U.S. or Australia, T&G recognized the potential an emerging market like Peru offered long-term.

"We felt that there was a bigger opportunity there. It's newer, it's a little bit more exciting, and we felt comfortable investing in Peru as we've had operations there for years," he said.

Club variety focus

The harvest on the first production phase of 48 hectares planted last year will kick off in mid-November, with a total of 100 hectares of farmland to be harvested next season. Volumes this campaign will be small and it will be treated very much as a trial year. 

When all 200 hectares have been planted around 80-90% of the volumes will likely be seedless, according to Fitzpatrick. While some Red Globes are being planted, he said there was no desperate need for more as it was already the dominant variety in the industry.

"We have a bit of Red Globe and some Crimson Seedless, then later this year we're planting three new varieties from the Sheehan series - ones called Timco, Allison and Ivory, so those all come from clubs," he said.

"Next year, in the third phase of planting we’re looking to plant another two or three new varieties from one of the other clubs, and we’re just in negotiations with other club owners to become a licensee of their varieties.

"So we’re moving away from the open varieties. We have a good base of Crimson Seedless and Red Globe, then all others will be newer that have been developed by breeders."

While T&G's trading business is largely focused on Asian markets, Fitzpatrick said exports would be orientated initially toward countries where consumers favored seedless grapes like North America, Europe and the U.K.

"One of the main reasons that we wanted to plant and be involved is that we wanted to have fruit to offer to our customers in the U.S., the U.K., Europe, and even Latin America that have been crying out for good seedless," he said.

"We will absolutely be focused to those markets which are the big seedless markets, together with supplying some volume into Asia, which is a growing market for seedless grapes, particularly the likes of Korea.

"We will go where the market trends are, not just to serve the interests of a few customers, and we will probably follow a natural split of where Peruvian table grapes go today."

Fitzpatrick also emphasized the company was eager to reduce the environmental footprint of the project, including water and chemical usage minimization, and to treat workers fairly and equitably.

"We are trying to be good corporate citizens, working hard with our staff, giving them training and sending them overseas so they can learn from other operations," he said.

"We also working with the local community and have a strong sustainability focus, in line with our corporate strategy of having sustainability as a central pillar of our operations.

New Zealand Minister for Primary Industries Nathan Guy (center) and other guests.

"We’re going to have to build a packhouse in the next couple of years and we want to look at being right at the cutting edge of technology, sustainability, renewable energy, etcetera. BayWa, our parent company, have a large and growing renewable energy and smart farming division and our intention is to work closely with them on our farming operations."

Other investments on the cards

If everything proves successful with this project, Fitzpatrick said T&G would 'absolutely' consider investing in production elsewhere around the world.

"We’ve still got a couple of years to go before we really can say if this project has been successful or not, but nothing’s off the table," he said.

"The board at T&G are open to new investment and ideas, and grapes are one of our three or four key categories. Fundamentally, as well, we have demand from our customer base, so ticks it a lot of boxes for us strategically."

In Peru it is not just grapes that could be planted on the rest of the farmland, but potentially other crops like blueberries.

"What we’ve seen in Peru is that it seems to have an incredible ability to grow crops that we thought traditionally wouldn’t be able to grow there," he said.

"I think the example that most comes to mind is blueberries - five years ago Peru didn’t have a place in the industry and now it's rapidly becoming a strong player. They have an excellent window, so we would be very open to looking at trials of blueberries and to see if we were able to find varieties that work in the climate where we are."

"So that is probably first option, but we would be interested to look at any new product that was exciting and that has good prospects in the region. We still have more land to develop after we finish those 200 hectares. It may be table grapes and we may look at something else."

Photos: Courtesy of T&G Global

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