Chile: Returns for small cherries “far from” covering costs, says Fedefruta

August 20 , 2018

Returns to Chilean cherry growers for small-sized fruit during the recent record season were “far from” sufficient to cover production costs, according to an industry body.

The Chilean Federation of Fruit Producers (Fedefruta) also said that average industry returns had also fallen across the industry for the second consecutive year during the 2017-18 season, during which exports nearly doubled to a little over 180,000 metric tons (MT).

The association’s annual Liquidation Analysis found that the average net per-kilo return for all sizes was US$4.16, which is US$1 lower than the previous season and US$1.5 lower than the 2015-16 campaign.

“With the notable increase in volume exported this year, it was to be expected that we would see returns of this level, or even lower,” said Alfredo García who headed up the Fedefruta study.

“However, the worrying aspect from our latest analysis is that the smaller-sized cherries could cause economic loses for the producer.”

The analysis found that cherries of sizes 22-24mm and 24-26mm returned US$1.08 and US$2.28 per kilo, respectively, while the average annual cost to produce them rose to US$2.93.

In addition, average returns for a kilo of medium sizes (26-28mm) was US$3.70, generating less than one dollar per kilo of profits to the grower for those sizes, said the Fedefruta analysis.

Fedefruta will on Tuesday (August 21) host a regional industry meeting in Rancagua, during which it will also hold an export workshop to help growers maximize returns.

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  1. Jim says:

    As of 2016, Chile produced 123,200 tons of cherries and exported $1.2 billion usd worth of it (according to https://www.tridge.com/intelligences/cherry/CL/export). It is extremely worrying that despite these great figures, the farmers are making a tremendous loss for every cherry they sell.

    1. Jimmy says:

      Your last comment is misleading, and better stated should say that farmers are having losses for every cherry they sell….UNDER 26mm. Avg per kilo return across all sizes is $1.23 per kilo more than avg production cost, so it still a profitable endeavor. So in the end, profitability depends solely on the size distribution of any particular growers crop