Stone Fruit Annual 2012

An Expert's View about Pome Fruits (such as apples or pears) and Stone Fruits (such as peaches, cherries, etc.) in Chile

Posted on: 31 Aug 2012

Chile’s production estimates for peaches and nectarines are expected to fall, while cherry production will continue to expand.

THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY Required Report - public distribution Date: 8/22/2012 GAIN Report Number: CI1223 Chile Stone Fruit Annual Peaches & Nectarines and Cherry Annual Approved By: Rachel Bickford, Agricultural Attaché Prepared By: Luis Hennicke, Agricultural Specialist Report Highlights: Chile’s production estimates for peaches and nectarines are expected to fall, while cherry production will continue to expand as large areas of new planted orchards are coming into production. Executive Summary: Chilean cherry production increased in MY2011/2012 when compared to the previous year as a result of an increased harvesting area together with good weather conditions during the harvest period. Peach and nectarine production and exports fell as planted area continued to decrease mainly as a result falling economic returns. A revaluation of the Chilean peso against the dollar and increasing production costs encouraged farmers to uproot low producing orchards. This is not the case for cherries as producers still obtain good economic returns in spite of the deterioration of the exchange rate; this encourages farmers to increase cherry plantings. During the last few years planted areas to cherries have increased significantly. For MY2012/2013 the industry is forecasting a slight decrease in production for peaches and nectarines as weather during last winter has not been favorable and planted and production area continues to fall. For cherries a further expansion of production can be expected as additional planted area is coming into production and a still large area is in the incremental stage of production. Post uses trade data published by the Ministry of Agriculture and their source is Chilean Customs. This data could be different from that obtained from the Global Trade data because most fruit exports go on consignment and are initially registered with an estimated figure. Later once it is traded the initial data is corrected with a real figure. These corrections are done sometimes a year later. Figures published in the Global Trade Atlas normally take the first figure published by Customs and are not corrected later on. Commodities: Fresh Peaches & Nectarines Production: Total planted area of peaches and nectarines continues to decrease when compared with previous years as some old orchards are not replaced. Total production does not show a corresponding significant reduction as many farmers update their older orchards with new more productive varieties. As new varieties develop, most producers have been replacing old, less acceptable varieties, especially with the nectarines. As peaches have a shorter shelf life and are less attractive to consumers, planted area to this fruit has decreased proportionally more during the last few years. Additionally, declining economic returns during the last few years has also contributed in uprooting peach orchards in a larger than previously estimated area. However, in general output variations are mainly the result of changing weather conditions. Some varieties also are affected by yearly alternate bearing effect. There are over 36 peach varieties for fresh consumption and another 36 varieties of nectarines grown and exported from Chile. Peach and nectarine varieties often become obsolete because of changing consumer tastes, even sometimes before trees begin bearing fruit. This situation, coupled with high price fluctuations during the last few seasons and diminishing returns have resulted in further reduction in total planted area in the coming years as was indicated by the industry. MY2011/12 brought a smaller than previously predicted harvest for both peaches and nectarines. For the MY2012/13 production season it is still too early for a good prediction, but industry sources have indicated that as a result of higher temperatures during this winter, some production areas will probably not accumulate enough cold hours for a for a good budding which will result in a lower production volume of peaches and nectarines when compared to last season. The quality of the production could also be affected which will reduce next season’s export volumes and returns. Consumption: A large percentage of the total peach and nectarine production is consumed as fresh fruit (40%). There is no breakdown on the volume of clingstone versus freestone production or consumption in Chile. Like most fresh fruit consumption in Chile, domestic consumption of peaches and nectarines is mainly lower quality fruit that does not make it to the export market. Trade: Close to 50 percent of Chile’s total peach and nectarine exports are bound for the United States. Latin America is the second largest export market with a 23 percent of total exports, followed by deliveries to Europe with roughly 15 percent. The relatively short shelf life of peaches and nectarines and is the major factor influencing the search for nearby markets. Some stone fruits are imported; these come mainly from the United States. Among them, peaches and nectarines have been arriving during offseason and are successfully marketed in large supermarket chains. Over 95 percent of peaches and nectarines are exported from December through April with largest amounts during the month of February when almost 30 percent of the total volume is delivered yearly. Production, Supply and Demand Data Statistics: Fresh Peaches & Nectarines Chile 2010/2011 2011/2012 2012/2013 Market Year Begin: Nov 2010 Market Year Begin: Nov 2011 Market Year Begin: Nov 2012 USDA Official New Post USDA Official New Post USDA Official New Post Area Planted 8,920 8,920 8,622 8,622 8,600 Area Harvested 8,470 8,470 8,190 8,190 8,165 Bearing Trees 5,720 5,720 5,531 5,531 5,514 Non-Bearing Trees 301 301 289 289 291 Total Trees 6,021 6,021 5,820 5,820 5,805 Commercial Production 160,300 160,300 157,900 152,300 150,250 Non-Comm. Production 1,000 1,000 1,000 1,000 1,000 Production 161,300 161,300 158,900 153,300 151,250 Imports 62 148 100 29 30 Total Supply 161,362 161,448 159,000 153,329 151,280 Fresh Dom. Consumption 58,200 58,200 58,500 54,446 54,280 Exports 99,700 99,765 98,000 95,683 93,800 For Processing 3,462 3,483 2,500 3,200 3,200 Withdrawal From Market 0 0 Total Distribution 161,362 161,448 159,000 153,329 151,280 HA, 1000 TREES, MT Export Trade Matrix Country Chile Commodity Fresh Peaches & Nectarines Exports for: 2010 2011 Time Period Nov10-Oct11 Units: M.T. Nov11-Oct12 Units: Volume Value Volume Value U.S. 50,763 58,146 U.S. 41,245 44,837 Others Others México 8,272 10,784 Brazil 10,437 11,911 Netherlands 7,948 11,673 Mexico 8,986 11,322 Brazil 6,631 6,447 Netherlands 7,808 8,121 Taiwan 4,682 8,764 Hong-Kong 5,901 8,267 Hong-Kong 4,434 7,837 Taiwan 4,876 6,783 U.K. 3,127 4,158 U.K. 3,122 3,399 Colombia 2,522 3,188 Colombia 2,822 3,685 Spain 2,482 3,289 Ecuador 1,900 2,173 Ecuador 1,922 2,040 Spain 1,273 1,514 Russia 1,085 1,220 Peru 1,122 1,139 Total for Others 43,105 48,247 Others not Listed 5,896 6,190 Grand Total 99,764 127,630 95,682 109,525 Note: 2011 data is from Nov 2011 through June 2012 only. Commodities: Fresh Cherries,(Sweet&Sour) Production: The cherry production area has expanded significantly in the last few years. Industry sources have indicated that during last few years between 1,500 to 2,500 hectares yearly have been planted, totaling today over 16,000 hectares. Close to 40 percent of the total planted area is still not in production or is in the incremental stage of production. As a result, cherry production should increase during the next few years. Cherries is one of the few fruits that producers are increasing their planted area significantly in spite of the continues fall of the dollar value against the peso which is hurting the fresh fruit industry in general by increasing production costs which are in pesos and falling returns which are in dollars. Producers have expanded the production period by introducing more weather resistant varieties and planting these further south. The main varieties planted are Bing, Sweet Heart and Santina which together represent over 88 percent of the total cherries exported. Among the main new-planted varieties are Lapins, Van, Stella and Summit. A total of over 70 varieties are planted in Chile. Although Chile has great potential for cherry production, every year the total output is affected by both climatic factors and/or the extreme delicacy of the fruit. A pre-harvest rain or other adverse weather conditions can damage the delicate skin of the fruit. These factors make the fruit production very expensive, as it requires extreme care and specialized labor. The harvest can only be done by hand; there is no mechanization. Chile has great potential because it is one of the few countries that can produce off season in the southern hemisphere for the large quantity of consumers of the northern hemisphere. Chile has an advantage over other countries like South Africa where there is cheap labor, but average temperatures are too high. New Zealand does not have enough suitable land for cherry production and Australia has water problems. Chile produces 2 percent of total world production but it meets almost 80 percent of the off-season demand. Weather has been favorable last year, as a result total cherry production in MY2011/2012 increased significantly when compared to both, our previous estimates and last year’s output. For MY2012/2013, a significant area is coming into production, as a result another production expansion is forecasted, although it is still too early for a good prediction. Nevertheless industry sources are skeptical and worried as weather predictions have indicated that there are indications that an El Niño weather phenomenon is apparently developing for late spring and summer which calls for unusual rain during the harvesting season. This could affect the quality and quantity of production seriously. Trade: As for other stone fruit, the U.S. is one of Chile’s most important fresh cherry export markets. As production expands in the coming years, industry expects to increase exports to the EU, Japan and especially China. Since 2007 Chile has exported cherries duty free to the EU and the agreement with Japan will lower the current 8.5 percent duty over six years to zero. The agreement with China calls for a duty reduction in 3 years of the present 10 percent duty. Although cherries are exported from early November through February, over 90 percent are exported during the months of December and January of each year. Production, Supply and Demand Data Statistics: Fresh Cherries,(Sweet&Sour) Chile 2010/2011 2011/2012 2012/2013 Market Year Begin: Nov 2010 Market Year Begin: Nov 2011 Market Year Begin: Nov 2012 USDA Official New Post USDA Official New Post USDA Official New Post Area Planted 13,143 13,143 14,143 14,928 16,428 Area Harvested 10,280 10,280 10,480 11,047 12,151 Bearing Trees 5,456 5,456 5,562 5,863 6,449 Non-Bearing Trees 2,430 2,430 2,924 3,094 3,412 Total Trees 7,886 7,886 8,486 8,957 9,861 Commercial Production 76,120 76,120 82,000 84,793 91,272 Non-Comm. Production 1,000 1,000 1,000 1,000 1,000 Production 77,120 77,120 83,000 85,793 92,272 Imports 8 2 8 2 2 Total Supply 77,128 77,122 83,008 85,795 92,274 Fresh Dom. Consumption 10,525 11,500 11,808 12,000 12,000 Exports 57,600 57,566 62,000 70,227 75,774 For Processing 9,003 8,056 9,200 3,568 4,500 Withdrawal From Market 0 0 Total Distribution 77,128 77,122 83,008 85,795 92,274 HA, 1000 TREES, MT Export Trade Matrix Country Chile Commodity Fresh Cherries,(Sweet&Sour) Exports for: 2010 2011 Time Period Nov10-Oct11 Units: M.T. Nov11-Oct12 Units: Volume Value Volume Value U.S. 20,132 66,794 U.S. 15,630 57,584 Others Others Hong-Kong 13,098 74,778 China 24,926 139,150 China 9,120 57,733 Hong-Kong 12,876 70,658 Taiwan 3,889 23,314 Taiwan 4,018 22,508 Brazil 2,558 9,900 Brazil 3,116 13,839 U.K. 2,392 9,741 U.K. 2,804 12,276 Spain 1,291 5,930 Netherlands 1,399 6,005 Netherlands 1,085 3,812 Ecuador 1,224 2,497 Canada 628 2,108 Spain 968 4,593 Ecuador 594 1,318 France 320 2,032 France 289 1,675 India 293 1,927 Total for Others 34,944 51,944 Others not Listed 2,490 2,653 Grand Total 57,566 269,968 70,227 347,992 Note: 2011 data is from Nov 2011 through June 2012 only.
Posted: 31 August 2012

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