The Argentine fruit growing areas of Río Negro and Neuquén have been plagued by rising internal costs and Brazilian trade barriers, leading to lower exports in the first half of this year. These problems took their toll on the region's apple and pear producers.

Integrated Fruit Growers Chamber (CAFI) executive director Marcelo Loyarte, told www.freshfruitportal.com that higher costs meant nearly 30% of proposed exports haven't taken place.

"Also, Brazil's tougher import requirements prompted a fall in exports over a four to eight week period," says Loyarte.

He adds growers were not the only ones hit, with everyone in the chain affected by these measures.

"The entire industry is having problems, from an income point of view and also from a financial standpoint."

He says the industry has not only exported less, but in many cases has not been able to cover costs and there has been insufficient funding aggravated by the lack of export tax refunds.

Loyarte says growers have asked the authorities for action to recover sector competitiveness.

"We have requested for a series of measures to cushion the effects of the crisis, primarly tax measures and new funds that will maintain employment and activity levels."

He explains the export drop during the first half of the year was because they could not realize operating prices at the right level for sales.

"It should be borne in mind that the fundamental difficulty is increased costs and an exchange rate that has moved very little."

Brazil position

Loyarte reports the situation in Brazil is still not fully resolved. He says while licences were issued on pears in blocks, the mechanism is complex, cumbersome and bureaucratic.

"We are seeing a drop in exports to Brazil and this fall is a result of these difficulties and the complex mechanism, which is indeed discouraging importers from buying fruit too."

He adds the sector is working on finding a way where Brazil does not need to implement the licences.

"We know it's a difficult route because the bilateral relationship today is very complicated from the commercial point of view, but hopefully within the next few weeks we will have more fluid trade.

"We are concerned about the rate at which exports are happening in Brazil. It's essential to resolve this situation because you have to remember that in the second half of the year Brazil is the largest market for Argentine apples and pears. If the market is not fully opened up we may have difficulties."

Related stories: South Argentine fruit exports hit 8-year low

www.freshfruitportal.com