Panama Canal expansion to open Asian opportunities for Brazilian melons
As Brazil seeks to gain access to the Chinese melon market, there is an instrumental development closer to home that could cut transit times by 12 days.
In conversation with www.freshfruitportal.com, Agricola Famosa's director for fresh products, Luiz Roberto Barcelos, said his company currently exported small shipments of melons to Hong Kong and Singapore, but it was a lengthy process.
"We know that in the middle of the year they will finish the Panama Canal extension and then the route will change – now it’s going from the south of Brazil to South Africa and then to Asia," Barcelos said.
"It will change, going from the north of Brazil through the Panama Canal to Asia, so we will reduce our travel time by 12 days – it will be good for us in terms of transit time and price.
"Currently just the cost to go inland from our region in Fortaleza to Sao Paulo costs more than the seafreight to arrive to Hong Kong," he added, emphasizing not only would the new development improve price attractiveness for buyers, but would have a significant impact on shelf life.
The company grows around 300 different genetic varieties of melons every year, choosing two from its research programs to incorporate in commercial fields, in a bid to get a good balance between fruit flavor and the ability to hold up to long journeys.
"Easily you can arrive with 14° Brix with a shelf life of more than 30 days, and that’s genetics," he said.
Barcelos is hopeful the Chinese market will be opened up for Brazilian melons this year.
"To have an idea they grow 550,000 hectares and Brazil only has 20,000 all year round, so 10% of this market in the winter would be a very huge volume for us," he said.
At the same time, the company has the U.S. in its sights, where it has been shipping small trial consignments of five containers per week this season.
"The idea is that next season we’ll do three times more, with 15-20 containers per week to the United States," he said, clarifying this would mainly be a December to March deal.
So why this orientation toward new destinations? For Agricola Famosa, not only does it plan to continue planting 20% more crops every year, but its core market Europe has been under pressure.
"For Famosa, this season that is finishing this month we’ll finish at about 7,500 containers. That’s a very big volume – we grew on 8,000 hectares this season, and 40% is for the local market," he said.
"We are a very big supplier, and on the average we deliver 400 containers per week mainly to Spain, England and Holland, but now we are looking for new markets outside of Europe because we are very concentrated here - we are in the Middle East market, loading about 12 containers per week.
"Here in Europe, it’s suffered a bit with the volume we sent here. Sometimes the price was pressured downwards, and for this reason to maintain our increase we need to open new markets for melons and watermelons."
Brazil's changing export culture
Barcelos is also chairman of the Brazilian Fruit Growers-Exporters Association (ABRAFRUTAS), which is involved in the 'Frutas do Brasil' branding initiative launched at Fruit Attraction in Madrid late last year.
He said it was still early days for the brand, but a decision about what to do with the scheme would be made in March, most likely involving supermarket displays for Brazilian fruit.
In 2015, Brazil's total fresh fruit sales rose by US$100 million to reach US$735 million, while the growth in volume was higher still at 18%.
"Our numbers in terms of the export of fresh fruits is less than 1% of the agribusiness in total, when you put in sugarcane, soybeans, cacao and everything else," he said.
"The idea is to promote this segment of fresh fruit exports more," he said, adding that to date the only crop mostly geared toward export was melons.
"We are creating the culture of export in Brazil for other growers – this year there are a lot of growers who are here [at Fruit Logistica] for the first time."
At the industry level, he highlighted watermelons, grapes, apples and mangoes as some of the fruits that experienced export volume growth in 2015.
"The real has come down so the depreciation of our currency has influenced us; it's helped us to increase, because now we are more competitive.
"It's helped us a lot, but it's also helped other agribusiness products yet they have gone down."