Manuel Yzaga Dibós: "There are going to be casualties"

President of Peru’s Provid: "There are going to be casualties"

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President of Peru’s Provid:

Peruvian table grapes have reached historic records this past season, with over 65 million boxes exported. 

The sector generates employment and helps to boost the economy, but what is behind this growth in volume? What are the dangers? What role do the new varieties play? Manuel Yzaga Dibós, president of the Peruvian Association of Table Grape Producers (Provid) and general manager of Vanguard Peru, answers these and other questions.

In a press release, Provid announced the following: "We have shipped more than 30,100 containers of table grapes of the highest quality to more than 60 destinations around the world".

For Yzaga Dibós this is indeed a record for the sector, but it is a record "that scares and worries" him.

What are your concerns? 

Historically, Chile exported 100 million cases, but over the years it has been going down and down. This year Chile exported 56 million cases. 

Peru, on the other hand, exported 6 million boxes in 2002 and now exports almost 72 million boxes. 

So, of course, if today we add those almost 72 million boxes from Peru plus the 56 million boxes from Chile, we are facing an enormous growth in grape supply, and there are going to be casualties. 

Who will be these casualties? 

Those who are not financially sound, those who cannot withstand the problems that always arise. I applaud this historic record for Peru, I applaud the volumes, the labor supply, the dynamics of the macroeconomy... but, companies are worried.

Peru is the leading exporter of fresh grapes in the world. Isn't it contradictory for such a politically precarious country? Do businessmen know how to do things well in Peru?

There are businessmen who do things well, and we are the ones who, with passion, effort and risk, make our country, 'we put Peru into it', that is why we have reached where we have reached.

The businessmen who do things wrong add more volume to the market, generating claims to the industry; they cause problems that should not exist. For example, how can an area with a water ban grow agriculturally? This is adding problems to the area and kilograms to the market.

Of course, the positive side of this is that it provides work, but the workers are also settlers, who then go to complain about the lack of water, while at the same time they are grateful for the work that is given to them, it is a complicated matter.

When you put all this in the balance you realize that someone is not doing things right, I do not know if it is the state or some bad businessmen, or both, but the fact is that Peru has grown against a background of unfair competition; there are people who get on the bus without paying, they get around the system.

What is the evolution of the new varieties in Peru versus the traditional ones? 

The new varieties have given us the opportunity to reinvent the business and live up to date, otherwise we would have gone bankrupt. The new varieties are more attractive, they produce more, they are friendlier. They have challenges, of course, but they have allowed us to absorb the ever-increasing costs. 

Such as? 

Environmental costs have been increasing over the years. I am all for environmental certifications and permits, but they cost more and more money.

Let me explain. Sometimes, two different supermarket chains ask you for very similar certifications, and one, as a company, must carry out all the processes to obtain each of these certifications.

Ultimately, a company ends up spending twice as much on certifications; there should be a transversal certification that translates into only one expense for the company. Well, the new varieties have allowed us to absorb these types of costs.

Can it be said that grapes are already a commodity?  

The supply of grapes is varied, there are different brands, but the volumes are such that there are times when no brand can support it and the price is 'commoditized'. 

We have entered a business where supposedly there was not going to be so much fruit, but something else happened; the commitment, on the part of the geneticists, was a different one.

What was the commitment? 

To not saturate the markets with fruit. 

How are prices? 

Prices now are lower than when we entered the business. 

So, is the grape business still profitable?

For the efficient ones, yes, but, as I said, there are going to be casualties. It is already known that there are grape companies in Ica that are not going to pay profits to their workers this year, as has been announced by the companies themselves. 

What will be the impact of climatic phenomena on Peruvian grapes? 

The risk is greater, but we have been doing planning work focused on mitigating the impact of the rains, such as keeping the riverbeds clean, the riverbeds of the intakes clean, making a fungus control plan, we must review the ways of cooling in the packing, with adequate humidity... From Provid, we have called the attention of the companies to take these precautions, these protocols against the rains that are announced.

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