Blueberries are the Peruvian export star
November 30, 2012

By Terra Business SAC chief executive officer and agronomist in international trade and marketing Federico Beltrán Molina

Blueberries are considered the most profitable of the berry family with high growth prospects in international markets due to their nutritional and antioxidant properties that make them a super fruit.

These qualities have encouraged consumption in the U.S., Europe and Asia; markets that demand products that contribute to the quality of life.

The opportunity for Peru’s exportable supply is the possibility of entering in the U.S. and Europe during the counterseason (August-September and April-May).

Although blueberries were introduced to Peru in 2007, it’s estimated there are currently only 300 hectares planted with the fruit. However, it’s expected this area will expand significantly due to the technical and commercial results obtained by the pioneers.

Although competition is dynamic, we can say that the size of Peru’s commercial window (August-September) is equivalent to the cultivation of 5,000 hectares and US$700 million (FOB) worth of exports. According to planting projections, this surface area will be installed in the next five years.

Global blueberry exports are now worth more than US$1 billion with Chile, the U.S., Canada, Argentina and Spain as the most important exporters. On the other hand the main markets are the U.S., England, the Netherlands, Germany and Canada.

The growth of global consumption has transformed the fruit from a niche product to a market product. Demand is not only growing for the fresh product, but through the creation of new applications in the industry. On average 1,500 new applications are developed each year.

In 2011 it was the most profitable item per square meter in the U.S. retail industry. On the other hand, earlier this year McDonald’s began selling fresh blueberries in 15,000 stores, so it’s clear consumption is unstoppable.

In 2010, the consumption per capita of blueberries in the U.S. rose to 0.5kg (1.1lbs), compared to 0.24kg (0.53lbs) in 2004. In Europe, per capita consumption exceeded 150 grams with Asia representing a potential market given the high purchasing power of its inhabitants.

Consumption and prices are increasing despite the economic crises in some markets. Peru could become a leading Southern Hemisphere exporter of all types of berries (blueberries, raspberries, strawberries) and cherries.

This assumption is based on market behavior and the dynamics of competitors in this busines, as well as the results obtained in different private operations; developed in recent years in the regions of Arequipa, Ica, Lima, Cajamarca, Ancash, La Libertad, Lambayeque and Piura have emerged as key growing regions.

The first blueberry harvests in the country showed the plantations developed with high levels of productivity, quality and were cost competitive; they also obtained a trade window of worldwide interest.

Moreover, the results also showed that berries and cherries thrived best in the mountainous regions than in other parts of the country; due to the soil and climate the high Andean areas are ideal for the development of this type of fruit that requires high levels of cold, a wide thermal range and acidic soil.

Blueberries could be a source of wealth in the mountainous regions and could help erradicate poverty. However, it’s clear they will not prosper in all parts of the country.

Five years ago we started the development stage for importing, introducing and testing different genetic varieties; and business promotion. Now we know which cultivars prosper and which don’t. However, we are still learning about cultivation management in Peru.

The challenge now is to shorten the learning process and reduce the failure rate. This goes from genetics to distribution. We need to grow suitable varieties, have quality and safety as keys to our business, and concentrate on commercial crop windows; these are some of the key challenges in this business.

In Peru there have been successful cases both in the mountains and the coast; however, there have also been failures. The causes are basic errors that are still being committed. The main factor of success or failure is the selection of the zones where the crop is planted, and this has to respond to productive factors, not the availability of land.

Our buisness experience shows quality, volume and water availability, connectivity, altitudes, soil quality and climate are the main factors to consider.

In the world there are more than 25 million hectares of potatoes and only 90,000 of blueberries. Evidently, cultivation has its suprises but an income of more than US$80,000 per hectare must be worth the effort.

Peru’s blueberry SWOT analysis

The main strengths are that the harvest coincides with a period of worldwide scarcity of the fruit (September-October) and the ability to enter markets before Uruguayan, Argentine and Chilean production.

Competition is dynamic – Mexico is growing at a significant pace while Uruguay and Argentina are slower. Weaknesses relate to large investment in plants, technology, knowledge and labor; an increasingly scare resource in the country.

Opportunities lie in increasing demand from the U.S., Europe and Asia due to the fruit’s high antioxidant content, international prices and the counter season offering.

The risks relate to cold treatment and the U.S. requirement on methyl bromide to counteract fruit flies. Europe does not require this treatment. Also, Mexico and Uruguay’s blueberry supply development and presence in the U.S. is a concern.

Similarly, the lengthening of local season production in importing countries and exporting countries such as Argentina, Chile and Uruguay is a threat.

Target markets

The U.S. is the largest market of interest for Peru. However, until blueberry producting areas are declared ‘fruit fly free’ , which could take two to six years, fresh produce exports will have to have cold or methyl bromide treatment. Currently, the only regions that have fruit fly free status are Tacna, Moquegua and Arequipa.

Fortunately, Peruvian exports to Europe do not require fruit fly treatment. Considering consumer and competition dynamics, the target markets for export should be the U.K., the Netherlands and Germany, which accounts for 22.3% of world imports.