Russia Consolidates its Position as the Main Destination for Argentine Pears

Argentine pear and apple exports experienced a significant increase during the first quarter of 2020, as they grew by 30% and 22% respectively, according to data published by the Nation’s Ministry of Agriculture, Livestock, and Fisheries.

In this period, Russia established itself as the main destination for pears after it imported between January and March more than half of the 81,031 MT it imported throughout all of 2019. As reported by the Ministry in a statement, “shipments of pears to that destination reached 44,867 MT and were worth more than 31 million dollars; which places Russia as the main market for Argentine pears, concentrating 30% of exports.”

Meanwhile, apple exports stood at 3,245 MT of apples worth more than $2 million, i.e. 22% higher than in the same period in 2019.

The Ministry also highlighted that Argentine fruits were benefiting from a 25% tariff reduction granted by the Eurasian Economic Union (UEE), which is formed by the Russian Federation, the Republics of Armenia, Belarus, Kazakhstan, and Kyrgyzstan.

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Rising Price of Imported Pears in Russia

In winter, imported products traditionally prevail in the pear market in Russia, reported EastFruit project analysts. The main countries supplying pears during this period are Argentina, Belgium and the Netherlands. At the same time, it is worth noting that prices for imported pears have always been significantly higher than for domestic products. And today, prices for imported pears continue to rise.

According to market operators, the main reason for the fairly high prices in this segment is the growing demand for these fruits and the low yield of pears in most EU countries and the countries of the Southern Hemisphere this season.

On the Russian market, imported pears are consequently sold for 114-150 rubles / kg ($1.74-2.29/kg), which is on average 14% more expensive than at the end of the previous working week.

According to market participants, several factors explain the price increase. Firstly, the supply in the countries that traditionally deliver these products to the Russian market during the winter is already running out, and therefore it can be difficult to acquire the volumes needed. Secondly, fluctuations in exchange rates continue to have an impact.

It is worth noting that at the moment, imported pears in Russia are already on average 15% more expensive than at the end of February last year. This price increase does not please the suppliers of imported products, since the consumption of pears in Russia will fall rapidly as they rise in price. Importers believe that further appreciation of these fruits may lead to a sharp drop in the volume of pear imports to Russia.

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In Russia, the consumption of apples and pears decreased

According to analysts of Growth Technology company, average consumption of fresh fruit and vegetables per capita fell by 19% for the past 3 years in Russia. During 2016, average consumption of fruits and berries was 52 kg, while in 2013-2014, it was 64 kg. The analysts include fruits bought in shops and markets, as well as grown in private orchards, in the total amount. The amount of fruit and berries from private orchards accounts for 68% of the total amount, but the share is going down due to urbanization of the country.

Pome fruit, and especially apples, have always been the most popular fruit in Russia. Average fresh apple consumption is 25 – 30 kg, and more than half of them are imported. In spring and early summer, the share of imported pome fruits sharply increase due to the lack of a modern storage facilities.

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Steady demand for pears in Russia

According to major Russian retailer, the Dixy Group, pears are one of the most favoured fruits in Russia, enjoying stable sales throughout the year.

The peak season for pears starts at the beginning of spring with the start of supplies from the Southern Hemisphere. The main varieties during that time period are the Vermont and the Packham.

“Before the embargo, Belgium and Holland had been the main supplier for pears. However, we were lucky that we also had contracts with suppliers outside of the EU, once the embargo hit, so we were able to quickly rearrange distribution with a minimal amount of disruption.” said a representative from the retail chain.

The main pear supplier has become Serbia during January-April, in addition to supplies coming from South Africa, Argentina and Chile from April to September.

Despite suffering frost damage in the spring, the retailer said that they had not noticed any supply issues from Serbia and that the prices are at the same level as last year.

“The green pear varieties remain the favourite amongst consumers, and we currently have the Williams and Chinese pear in our assortment.”

As soon as the Russian embargo was introduced back in 2014, Russian suppliers immediately started to develop this category, actively investing in new growing areas and creating their own supply chain, but the production is still not to the level to be able to cover the demands of the major retail chains.

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Russia: pear imports down month-on-month in May

Russia lowered pear imports by 37.5% in May 2014 compared with the previous month, according to the official statistics.

Thus, the import volumes totaled just 31,000 tons, the lowest result over the past 5 years and a decrease of 18% year-on-year.

Russia’s cumulative imports over the period from July 2013 to May 2014 stood at 355,000 tons, an increase of 4% compared with the same period of the previous season. The Netherlands were the main supplier of pears to the Russian market with the share of about 25% in Russia’s total imports. Argentina and Belgium also exported significant volumes, and their shares amounted to 17% each.

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Devaluation of the Rouble hampers fruit export to Russia

Although Crimea no longer dominates the daily news, it has affected fruit export. “I think that the political situation cost volume and also price development,” said fruit exporter Kees Oskam from Vleuten. “But I’m actually happy that we can simply still deliver at these prices. It could be worse.”

“Of course we would have preferred higher prices, but the Rouble has almost halved in value and that plays an important role. There are region’s to which we can no longer export because it is too expensive. In Moscow and the surrounding areas that is not the case because the average income is higher.” Trading company Jan Oskam traditionally export top fruit to The Ukraine, but even there devaluation of the Hryvna has caused problems.

“It is a daily priority to see if we can export. I have to say last week was more difficult than this week, maybe because it was still front page news. Obviously we are talking to receivers who are equally concerned to keep trade moving,” said the trader.

“The fact that the pear price is unstable on the Russian market makes for a tricky situation because the market is and remains unpredictable,” concluded Kees. “Only a few apples go to Russia here and there, because Polish exporters have cornered the market with their lower prices, but they also complain a lot about difficulties they have with supplies from Serbia.”

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Anjou pear sales are up

Anjou pear volumes were 24% higher in the last quarter of 2013 than in the same quarter the year before.

Sales of the variety also were 26% higher, according to Nielsen Perishables Group data analyzed by Wenatchee, Washington-based grower-shipper Stemilt Growers.

Volumes and sales of red anjous, bartletts and boscs also were up in the quarter, according to a Stemilt news release.

More use of ripening programs, value bag offerings and multiple varieties on ad at once are some of the reasons Stemilt has enjoyed a season of brisk pear movement, marketing director Roger Pepperl said in the release.

“Here at Stemilt, our pear program has really benefitted over the past several years from capital investments, new products, and a focus on getting multiple pears on ad every month during the fall and winter season,” Pepperl said in the release. “The increased shelf space for pears during a multi-pear ad often results in 15-20% increases in volume when compared to one item pear ads.”

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Pear production down in Russia

According to WAPA data, pear production in the Russian Federation has significantly gone down in the season 2013/14.

Russia’s pear production amounted just to 43,000 tons, a decrease of 14% compared with the previous season and the lowest result over the past 10 years. For comparison, production totaled 50,000 tons in the season 2012/13.

The highest pear production level was registered in the Russian Federation in the season 2007/08: 96,000 tons.

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NW shippers moving through big pear crop

Northwest pear shippers and officials report robust demand for a big, high-quality crop.

About 72% of Northwest pears had yet to ship as of Nov. 8, up from 69% last year at the same time, said Kevin Moffitt, president and chief executive officer of Pear Bureau Northwest, Milwaukie, Ore. Yet 6.3 million boxes had already shipped as of that date, up from 6 million the year before, Moffitt said.

On Nov. 26, the U.S. Department of Agriculture reported prices of Markets could change when anjous take over the bulk of the deal’s heavy lifting from bartletts. Northwest shippers are on track to ship about 22.2 million boxes of pears this year, which would be the largest on record and 14% more than last season.

Fruit is sizing bigger this year, which has proved attractive to domestic buyers, particularly with the holidays coming up, Moffitt stated. However, bigger is not necessarily better for export markets. Prices should stay stable in general heading into December, but markets for scarcer small fruit could firm up. Northwest shippers should have all varieties on hand to ship for the holidays. In fact, with the big crop this season, most varieties should be available through January.

Quality is good this season, with about 88% of fruit grading out at No. 1-quality, which is normal, Moffitt said. Because of some labor shortages during harvest, some fruit hung on trees longer than usual, which improved its eating quality, he added.

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US: Pear harvest strong in Pacific Northwest

Oregon and Washington’s combined pear harvest will approach a record this year, with growers and packers reporting a heavy yield of large, high-quality fruit.

Estimates made in June, well before picking began, projected a fresh market harvest of 19.8 million 44-pound boxes, the standard measurement unit. The estimate was 4 percent larger than the five-year average, and would have made it the third largest crop grown by the Wenatchee and Yakima regions of Washington and the Mid-Columbia and Medford regions of Oregon.

Some growers were hard-pressed to find enough pickers at peak harvest in mid-September, when the Hood River Valley alone employed about 1,800 pickers a day. The crunch has passed, however. Growers in the upper valley, where fruit comes on later than at lower elevations, will finish picking soon, said Jean Godfrey, executive director of the Columbia Gorge Fruit Growers in Hood River.

“We have a very heavy crop, a beautiful crop, larger than normal,” Godfrey said.
Nathan Duckwall, assistant production manager at Duckwall Fruit in Odell, said his company may pack 10 percent more boxes than last year. “We had really good growing conditions this year, a good hot summer,” he said. “The size of the fruit is really big, too.”

The larger the pears, the fewer it takes to fill a box, which results in increased box production numbers. No matter the final production numbers, the harvest marks another good turn for Oregon and Washington pear growers.

About one-third of the crop that moves through Duckwall is exported. Top export markets include Mexico, Canada, Russia, Brazil, Colombia, Hong Kong and India. The latter is one of the strongest growth market for Northwest growers, according to Pear Bureau Northwest, a non-profit marketing firm that represents about 1,600 growers in Oregon and Washington.

China opened its door to U.S. pears for the first time in February, and is projected to become a top 10 market for Northwest growers within three years, according to the Pear Bureau. Pears packed by Duckwall were the first into China, Nathan Duckwall said. He’s cautious about the future impact of that market, however. “I don’t think it will be that big,” he said. “It’s significant, but it’s not a game changer.”

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