In this installment of the ‘Agronometrics In Charts’ series, Sarah Ilyas studies the state of the Chilean grape industry. Each week the series looks at a different horticultural commodity, focusing on a specific origin or topic visualizing the market factors that are driving change.
Chile ended its grape season with a notable deviation from the usual timeframe.
“This year due to the heat waves that Chile had across central-south valleys, it was a pretty concentrated season. We had very heavy arrivals through March and that concentration at the end meant the season finished two to three weeks early, factoring in as well the 18-20% less volume compared to last year and the same shortage rate reflected on shipments to the U.S.,” says Franco Pruzzo of Summit Produce Inc.
Incoming volumes this season culminated at 37,100 tons, a 24% decline compared to the highest volume of 48,600 tons recorded in the 2021-22 season.
Source: USDA Market News via Agronometrics.Chile is anticipated to conclude its export season with an approximate shipment of 60 million cartons. The North American market accounted for 32 million cartons, with the United States receiving 30 million. According to Pruzzo, the received product has garnered considerable satisfaction, demonstrating a robust shelf-life that enabled prolongation into the months of March, April, and the initial weeks of May.
This season's outcomes further underscore the significance of Chile as a prominent growing region and supplier of grapes to the Northern Hemisphere during the winter period. Prices this season reached historic levels, climbing as high as $37.69 per package in week 19, a 72% increase over the 2021-22 season.
Source: USDA Market News via Agronometrics.
Source: USDA Market News via Agronometrics.According to industry data, in the last five years, Chilean fruit exports have fallen by 3%. The president of the Association of Fruit Exporters (Asoex), Ivan Marambio claims that while climate change poses significant challenges to the Chilean fruit industry, the primary factor contributing to this decline is the emergence of Peru as a formidable competitor, particularly impacting the grape and blueberry sectors.
Marambio attributed Peru's success to favorable climate conditions, as it benefits from a warmer climate compared to Chile, providing greater adaptability for fruit cultivation.
Source: USDA Market News via Agronometrics.According to the USDA, the downward trend in Chilean table grape production can primarily be attributed to two factors: drought conditions and competition from crops that offer higher profitability. The impact of drought has been particularly evident in recent years, leading to a decline in table grape production.
This issue is deemed a structural problem that is expected to persist in the upcoming marketing years. Notably, rainfall in MY 2022-23 was abundant and may have mitigated more severe declines in grape production; these gains, however, are unlikely to be sustainable in the long term.
The most recent data from the Office of Policy and Studies (ODEPA) under the Chilean Ministry of Agriculture reveals a reduction in the planted area for table grapes across all regions. Notably, the Valparaiso region has witnessed a significant decrease in the planted area for table grapes, as some of it has been replaced by the cultivation of walnuts and citrus crops. Similarly, the O'Higgins region has experienced a decline in planted area, primarily due to the cultivation of more profitable crops such as cherries and walnuts.
In our ‘In Charts’ series, we work to tell some of the stories that are moving the industry. Feel free to take a look at the other articles by clicking here.
All pricing for domestic US produce represents the spot market at Shipping Point (i.e. packing house/climate controlled warehouse, etc.). For imported fruit, the pricing data represents the spot market at Port of Entry.
You can keep track of the markets daily through Agronometrics, a data visualization tool built to help the industry make sense of the huge amounts of data that professionals need to access to make informed decisions. If you found the information and the charts from this article useful, feel free to visit us at www.agronometrics.com where you can easily access these same graphs, or explore the other 21 commodities we currently track.
