A longstanding focus on durability over taste has put raspberries on the back foot in North America, where new labor laws in California are also likely to prompt a shift in production toward Mexico. During the Produce Marketing Association (PMA) Fresh Summit in Orlando recently, www.freshfruitportal.com caught up with Driscoll's Americas executive vice president Soren Bjorn for a raspberry round-up. 

"Raspberries, of the four berries, are certainly the most perishable," says Bjorn, summing up the category's biggest challenge in a nutshell.

In response, he says the trick has been to make raspberries good enough so they can be packed and shipped, but even with good shelf life the trading prospects are limited for fruit that isn't within "trucking distance".

"I think we now do that pretty well, but we’re at a critical juncture in the raspberry business where we have to make them taste better," Bjorn says.

"The other berries have consistently gotten better; we now have great tasting blackberries year-round, blueberries are increasingly tasting good year round, and I think in raspberries as we made them shippable and made the shelf life possible to get in consumers’ homes, we don’t quite have the flavor that we really need to have.

"So our big opportunity in the raspberry business is to really make them better tasting so they’re more appealing to consumers."

Soren Bjorn

Genetics are at the core of that challenge, with Driscoll's aiming to develop varieties that are more appropriate for the demand trends seen in berries.

"Now, if you can go back to some of the original raspberry flavors that were really quite good and get some of those flavors back without giving up shelf life and productivity, we could have a really attractive product that would sell a lot more than what we do today.

"Breeding is a slow process – from the day we make our first selections until we have a new variety is five or six years, so we can’t always change direction and expect to have something new.

"But a couple of years ago we started increasing the pressure on selecting more better-tasting varieties, and that’s what we expect to have in the future. But we don’t have a game-changer on flavor today, and in the meantime the growth in demand I think is going to be quite moderate in raspberries."

So if raspberry growth is moderate while blackberries and blueberries surge ahead, what impact will this have on the shelf space given to to the fruit.

"Usually blackberries got a little space and raspberries got a lot of space. Now blackberries are getting more space, and if the retailer is not just giving more space to berries – which some do –then maybe raspberries are pushed down a little bit," Bjorn said.

"That’s the kind of thing you see happening on the shelf right now, and it’s the same in organic. They’re getting more space in organic as well.

New labor laws to fundamentally change raspberry production origins

Not only does Bjorn see the development of new varieties as necessary for raspberry sector growth, but a more costly wage structure in California could also further push production south of the border into Mexico.

"The other issue in raspberries today is that most of the business is in California and we are about to go through some big changes in the Californian industry in our cost structure," Bjorn says.

"Minimum wage is going up and overtime is kicking in at eight hours and 40 hours a week instead of 10 hours a day and 60 hours a week, and raspberries which are the most labor intensive and can be picked seven days a week is going to be the most impacted.

"I can’t think of any other crop in California that’s going to be as impacted as raspberries."

He says the impending rises in the cost structure "won't be insignificant".

"Historically raspberries grown in the summertime in California are cheaper than the ones grown in the wintertime in Mexico, but that now might be a bit more even.

"So the cost structure comes up in California, and we still have the relatively low productivity in Mexico - now you’re going to be selling at similar prices.

"But where California overlaps with Mexico in terms of timing that production is going to move to Mexico. I don’t think there’s any doubt about that – the differences now are too big."

He says this won't be the case so much with other berries, mainly because raspberries can frequently get two crops per year in a given area.

"That’s not really the case in blackberries today - you usually get one crop. It’s much more isolated," he says, adding northern California's blackberry production goes from the June to August period which is generally too hot and humid in Mexico.

"In strawberries there’s not a lot of overlap either because it’s very difficult to plant early enough for Mexico to have fruit in the fall."

Despite the challenges, Bjorn emphasizes Driscoll's is still expanding its raspberry program.

"That growth for us is all out of Mexico – whether it’s from the fair trade side which we are about to expand, or just in general on conventional or organic, that is expanding quite significantly.

"It is really the California piece that won’t be growing, but that’s two-thirds of it today – so when you’ve got two thirds of the industry being held back, that’s really putting the lid on more growth."

Mexico-based Fresh Kampo sales manager Elimelech Nuñez echoes Bjorn's comments about a shift in production to Mexico, viewing the trend as an opportunity.

"Production in Mexico is increasing as a result of this. What a lot of American companies are doing now is not necessarily growing in land but moving production from California to Mexico," he says

"It brings jobs. I think it's good for Mexico, especially in the states of Jalisco, Michoacan and Guanajuato.

"The surface area of blackberries is very large in Mexico – but in terms of raspberries, strawberries and blueberries, they keep growing."

Nuñez adds a lot of growers are also turning to organic berries as a new opportunity, but the trend is still very much in its infancy.

Southern Hemisphere hangs in the balance

When asked about what part counterseasonal producers like Chile could play in the deal in future, Bjorn emphasizes the berry category really needs deals within trucking distance, with blueberries as more of an exception.

"You see this everywhere. We used to produce raspberries in Chile a long time ago – we don’t do it anymore," he says.

"We produce some in South Africa today, they go to Europe – not so much anymore and probably not at all in the future.

"All the raspberries now are being produced within trucking distance. The same thing is true for blackberries, the same thing is true for strawberries, and increasingly it’s true for blueberries as well."

To adapt, Bjorn believes producers like Chile need to focus on developing the South American market where the berry market is relatively undeveloped.

"Then with South Africa you’re looking at opportunities like Southeast Asia or in the Middle East, which are good raspberry markets – we are flying it in from California and Mexico anyway.

"We are not growing in the Middle East or Southeast Asia, and have no plans to do so, so those markets for South Africa may be a good opportunity. For Chile that’s pretty far away."

While Bjorn's focus is the Americas, he highlights Driscoll's has been focused on developing the Hong Kong market in recent years.

"That has really been part of a strategy to get into China. And we are now in China. We felt that market was the best proxy.

"We have people there on the ground every day and it’s not just an export market for the US. The Australian dollar is more competitive, so we're are actually exporting berries out of Australia under the Driscoll’s label – mostly blueberries now, but raspberries and ultimately strawberries will be part of that portfolio as well.

"We can service that market, whether it be South African raspberries, maybe Australian blueberries, Chilean blueberries, Californian strawberries, and then the local production in China.

"A big part of our growth platform at Driscoll’s is the Asian geography with an everyday presence in China for the Chinese market."

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