In what looks set to be a record year for volume, the Argentine cherry sector is increasingly making of faster shipping services from the Chilean port of Valparaíso to tap into Asian markets. While recent hail may impact next Argentine pome fruit crop in Argentine Patagonia may cause some setbacks for the deciduous fruit sector, it appears the region’s cherry growers have largely been spared thanks to a mix of time and geography.
“Fortunately it didn’t affect us. The Río Negro Valley had some cases of serious hail but for us it didn’t happen. It’s a large and extensive valley, so if there are some isolated weather issues the probability that something happens to us is still quite low”, says Adolfo Storni, Cerezas Argentinas operations director. Cerezas Argentinas, a large grower by Argentinean standards is also linked to blueberry operations Extraberries, is putting anti-hail nets and rain protection covers for new plantings of early varieties. The group is investing US$12 m in a packinghouse and production revamp over the next three years. “The project is to triple the packing capacity which is today quite limited, and plant more cherries as well as more pears and apples”, Storni says adding that an existing Unitec sorting machine is being extended to add more lines along with the reading technology “Cherry Vision”,
“Today we have 170 ha of cherries and 50 ha of apples and pear. What we’ll do in this project is 150 new hectares of cherries and the same areas for apples and pears.” Companies like Storni’s are emboldened not just by the booming cherry market in Asia that neighbours in Chile have been capitalizing on in recent years but also an economy in recovery with an outward-looking government.
Vista Alegre’s Managing Director Carlos Enriquez compares his country to a patient in intense therapy, still in recovery after years of economic crisis and protectionism. “Maybe the results can’t be seen yet, but we have a state that is opening up to the world and wants to insert itself into the global economy”, Enriquez says. He highlights this can be seen in the Government’s renewed push to seal trade agreements with Europe and China, and in the fruit industry Argentina is closer than ever to getting blueberries and cherries into the Chinese market.
And for producers like Enriquez in rural Argentina, more international flights from regional centers will also be a big help as a bridge to global markets. “In fact we have a flight with Latam from Neuquén to Santiago and it’s only 1 ½ hours. So this year we’ve had visitors from China and from American origins go to see their grower partners in Chile and then come straight here”, Enriquez says. “Connectivity makes commerce multiply because it is much easier to reach different places. We are encouraging expansion at thje Neuquén airport because of the cherry volume that will be rising in the coming years.Last year we did trials wich were fantastic with planes taking loads of chewrries to Miami and Hong Kong but not with the regularity we should have when the China mainland market opens.”
However, Association of Integrated Producers of Argentinean Cherries (CPCI) executive manager Annibal Caminiti, says that existing flights out of Neuquén to Santiago are not so well designed for highly perishable cargo. Caminiti is in accordance with Enriquez’s views on the enormous potential of charger flights from Neuquèn to varkous global destinations. “This year the provincial Government of Neuquén has been working on a readjustment project for the airport through the development of a new air cargo terminal with adequate transit halls and refrigeration to guarantee good quality. From Neuquén we are interested in charter flights to Asian markets, mostly to China, which can absorb a charter of 100-110 t and not generate a negative market impact.”
Air freight is a key component for the Argentina cherry industry to harness market windows when global supplies are scarce, whether it is early in the season in late October or November or from the latest varieties from the southern provinces as Chubut and Santa Cruz. But when supply is abundant, maritime shipment is essential to maintain profit margins. This is already a common practice from the port of Buenos Aires to markets like North America, Europe and the Middle East, but for Asia another solution is needed. “The advantage of being early here means our fruit arrives before the first volumes from Chile, so the market is totally clean. Now is when the market starts to get complicated, you see prices falling”, says Enriquez and continues: ”We can bring the cherries express to Chile. We clear it with customs here in Neuquén and it goes to China via sea freight. This has been done for the last three years. This year the amount of containers taking that route went up a lot.”
Before delving into season forecasts, Caminiti clarifies that Argentina’s cherry season is always dependant on weather issues and can be quite long, starting in Mendoza in late October and finishing at Lago Buenos Aires in the Santa Cruz province in February. The distance between those extreme production areas is almost 2,000 km.
“There are still harvests to be finished in Río Negro and Neuquén, whereas harvests didn’t start yet in Chubut and Santa Cruz. It’s looking like a record production year with good yields of very good quality fruit in general. We are also facing a season with a record export volume. Look”, Caminiti says, “Compared to other production areas in the Southern cone our volume is small. In 2016-17 we had 4,233 t with rather good prices, due to the high quality of our cherries from Patagonia.
Enriquez expects to finish harvests in the region early December. In Chubut, production is likely to start around Christmas and in Los Antiguos in Santa Cruz they will start in January. “The volumes, especially in Chubut, overlap with the Chilean season. They have to compete with a stronger player in the market. Storni reports that his company is linked to another group in Southern Argentina called Fruta de los Lagos in Colonia Sarmiento, one of the southernmost commercial cherry oeprations in the world.”This fruit is oriented towards later exports and it will be designated for China. The groves are fairly young and there is plenty of room for potential growth.