The season for Indian grapes has started strong, despite months of above-average temperatures, according to one major exporter.
Paresh Bhayani, director of grape exporter Panacea Energizers, said this year’s crop began early.
“We started in mid-December, almost fifteen days earlier than usual,” he said. “We will probably end two weeks earlier as well. However, production volumes are expected to increase 20% year-on-year.”
So far, he said the quality of the fruit and the production volume have been better than in past years.
Indian grapes are exported mainly to Europe, the U.K. and Russia. Bhayani is confident that Indian grapes will continue supplying the European market until the end of March.
The crisis in the Red Sea has forced shipments to divert around the Cape of Good Hope in South Africa, leading to much longer transit times.
“This means the fruit is traveling 41 days, instead of 21 days when shipments go through the Suez Canal,” Bhayani said.
“There could be some arrival problems with dehydration particularly because of moisture loss during transit. But overall, the season looks promising. The only negative part has been freight rates.”
Before the Red Sea crisis started in November, he says freight rates to Europe were between $1,100 to $1,200. Now with the longer shipping times, freight rates have risen to almost $4,500.
The majority of the Indian volume travels to Rotterdam, Netherlands or to the United Kingdom.
In week 6, Bhayani said 1,027 containers were shipped to Rotterdam, the highest volume so far in the 2023-24 season.
With the Indian season ending early, Bhayani believes that there could be a shortfall in the European market later this year.
“Right now, price in the market is at around €12- €15. It could come down to around €10 depending on the volumes from South Africa, as well as how Easter promotions work, because it is earlier this year,” Bhayani said.
Bhayani says a challenge during peak season is saturation of the European market. The market has the capacity to receive about 670-700 containers per week, which means limited growth opportunities.
“We might have to look at the Far East Asian market, maybe China. However, I personally think the Far East Asian market is highly demanding in terms of quality, and very volatile,” he said. “I've tried in the past, but everything is customer-driven. Therefore, if there is too much fruit available, you might lose money.”
The Far East Asian market, while large and closer in distance to India, comes with its limitations as well.
“The main shipping lines are not offering many refrigerated containers, and prices can reach up to $9,000,” Bhayani said.
Freight rates to the Far East and Russia are higher than the price exporters will get paid for their shipments, he said, which is why Indian exporters are shipping very small volumes to the region.
“India used to export around 125 grape containers per week to Russia. This year, there have only been around 50-60,” Bhayani said.
Bhayani has begun testing plantations of five new varieties from the SNFL group and two varieties from IFG.
“This year, I am exporting two containers of Allison and Timco to U.K. supermarkets like Tesco. New varieties will play an important role in the near future,” Bhayani said.
“What I have understood after 20 years [in the industry] is that market demand for new varieties is growing more and more. In India, awareness of this demand has increased, and more farmers are interested in them.”
After seeing the first crop of Timco and Allison, Bhayani says he is more confident about the quality and genetic strength of these new varieties.
Regarding the future of Indian production, Bhayani said, “The solution to all the problems for Indian growers is having good pre-season farming, having a better understanding of plant physiology, and varietal replacement.”
