Indian development, global expansion and new varieties: Grapa talks plans for ARRA grapes
ARRA table grapes have established a strong presence around the world since the first variety launched a decade ago. With Grapa's recent announcement of an exclusive growing and marketing deal in India, the company is now making inroads into one of the biggest grape production countries of the globe, where proprietary cultivars are almost inexistent. FreshFruitPortal.com caught up with Grapa CEO Rafi Karniel to hear about what the future holds for ARRA grapes in India, expansion plans into other regions and new varieties in the pipeline.
"The potential in India is huge," says Karniel.
He noted that the world's second-largest table grape grower - with around 2.5 million metric tons annually - exports less than 10% of its total production. "We think that ARRA varieties will affect the Indian grape market in terms of quality."
In late-February Grapa announced a deal with U.K.-based Jupiter Group to begin commercial production of the grapes in India, in what was described as an "unprecedented move". Through a joint venture with a local grower cooperative, Jupiter has been trialing a couple of varieties over recent years in the country and will now carry out much larger scale plantings.
The first phase is of 2,000 hectares with the first fruit to be harvested in 2020, Karniel says. The white seedless variety ARRA 15 and red seedless ARRA 19, named ARRA Sweeties and ARRA Passion Glow, respectively, will be the first two to undergo commercial production, in parallel with further trials of other white, red and black varieties when the plant material is approved for entry.
Karniel noted that those two varieties have an uncommon trait which makes them resistant to rain - one reason why the ARRA varieties have fared well in Brazil, allowing growers there to produce two high-quality crops annually despite the wet weather, and why he expects them to prove a success in India where summer rains are common in some regions.
Grapa is a family business that commercializes the ARRA varieties worldwide except for in North America, which is the home of variety owner Agricultural Research & Development (ARD), a subsidiary of California-based grower-marketer Giumarra Vineyards Company (GVC). ARD was formed in 1999 through a partnership between GVC and Karniel's father, Shachar Karniel, who earlier that decade bred the Early Sweet variety, which is owned by Grapa.
Since the launch of the first ARRA variety in 2009, Grapa has licensed over 10,000 hectares around the world, with a focus on Chile, Peru and Brazil, but with production now in around two dozen countries including South Africa, Australia and Italy, as well as many other important regions.
While all the aforementioned countries have been popular places for the world's major table grape breeders to license their varieties, India has largely been avoided over fears of keeping their intellectual property under control. But Karniel is confident that the plant breeders' rights will be protected under the deal with Jupiter.
"We signed a licensing deal with Jupiter for India more than two years ago, but it was an unexclusive license, and over the last two years Jupiter was very keen to work with us exclusively in India," he says.
"We have been visiting India and talking to some players there to see what is the best structure we can work with, and then several months ago we reached the conclusion that in order for us to protect our varieties it's necessary to work with one strong partner and let them have exclusive marketing rights to help us better control the varieties."
Karniel says the majority of the fruit will likely be sent to the European and U.K. markets, helping to improve the varietal mix and quality of the Indian supply. But he noted there were also opportunities in other markets like China, which doesn't have an appetite for the predominant variety in India - Thompson seedless.
"China is looking for grapes during its off-season in India but is not willing to accept Thompson. This is why today the imports into China from India are very low, but we believe that with our varieties we will see that growing by the year," he says, adding that he had recently returned from China where he had learned a lot about Chinese preferences and is confident the ARRA varieties will be well received there.
"We are very excited about the future," he says.
Global growth and other expansion plans
China is not just a target growth market for Grapa, but also a target production area. It is the world's largest table grape producer, with annual volumes several times higher than India, but has faced similar challenges with introducing newer varieties.
Karniel is optimistic that ARRA grapes will be grown in China as well, in the not-too-distant future.
Turkey, the world's third-largest producer, is also in Grapa's sights for transformation into a significant supplier. "We've been working with very small volume - just one company with 40 hectares, which is nothing compared to the potential of this country," he says.
"So we're looking to extend our plantations in Turkey, as well as Central Asia. In this area there are also very challenging countries for us in terms of producing the grapes, and we first need to find the right partner and structure," he says, adding that the company is also looking into production in Eastern Europe.
Production in these areas will help achieve year-round supplies for ARRA varieties to service world markets, where their presence has been increasing over recent years. In Europe, the world's top table grape market, Karniel says that the grapes got off to a slow start but are now gaining a strong foothold.
"At the beginning, we faced some issues with quality because the varieties were new to growers so it took some time to adjust the protocol and have growers following the growing protocols, as well as export quality standards," he says. "But as time went by we improved on that, we gave growers more tools and support to increase quality production, and we've seen improvements now."
Grapa's commercialization structure includes having a local agent in almost every country where ARRA grapes are produced who also provides technical support for growers and ensures that growing, storage and export protocols are adhered to.
In addition, the company is in touch with importers to ensure that they understand about the characteristics and quality standards of each variety and also invites them to participate in the field days in California every summer to see the ideal fruit quality and learn more about what varieties are in the pipeline.
Varietal pipeline: Classic flavors and advantages for growers
There are already several seedless ARRA grapes in each color category, around half possessing trademark names, and the program at ARD is busy working on new varieties every year.
Karniel says that a large part of the program is focused on the classic Muscat flavor of grapes, noting that his father succeded in creating a new line of Muscat grapes that address the main problem they had faced in the past - browning in the white seedless grapes.
Taste is an important factor in the breeding program, but he says that another key aspect is how grower-friendly they are.
"We focus on the Muscat flavor more and more nowadays, but we also focus on what we've always been focused on - mass production varieties," he says. "While we see the added value of certain niche varieties, growers tell us frequently that they cannot make a living on niche varieties alone.”
He asserts that growers need highly productive and grower-friendly cultivars to help them cut costs and remain profitable.
"There is not as much of a premium price in many markets as there was in the past, and it seems like everyone is making money except for the growers. The only way for them to make money today is if they save money on production costs," he says.
"One of the biggest expenses that growers have is of course the manpower. If we give them varieties that require less work during the season, the grower really appreciates them because this is the only way for them to survive and make money."
He adds that most customers don't talk about different varieties, but rather different grape colors, and growers therefore need new and better varieties to replace old ones that are in declining popularity globally like Thompson, Flame and Red Globe. The ability to supply grape varieties year-round is also important to be sustainable, he added.
"ARRA 15 is now growing in significant volumes in South America and North America, which allows Giumarra to supply year-round," he says, noting the ARRA 15 variety has the most established 12-month portfolio in the ARRA line, but additional ARRA varieties would also achieve this soon.
"It's coming with the next generation like the ARRA 29, ARRA 30 and ARRA 32 varieties - we have more and more of them, especially ARRA 29 which has come to replace Flame, which growers have suffered from.
"ARRA 29 is a fantastic variety in terms of growing and market performance - great taste, simple to grow, very cost-effective. More and more growers are eager to replace their massive Flame plantations with ARRA 29, so we see great demand. In addition, the ARRA 30 has come to replace the old early white varieties and again is very productive, easy to grow, costs less and has a good market appreciation."
Overall, Karniel says that 2019 has been a "great year for the ARRA program" so far and he expects a strong future.
“There are a lot of positive new developments which are the outcome of the solid reputation of the ARRA varieties and the resulting trust that both the growers and marketers have in the varieties,” he says.
“We are very excited about what the future has in store for us and no matter how big the growth of the ARRA program is globally, we will always keep the family atmosphere and core values together with our partners and technical support.”
You will be able to find more information on topics such as this at the inaugural Global Grape Summit, which will take place alongside the London Produce Show and Conference on June 5th, 2019. Please visit www.globalgrapesummit.