Agronometrics in Charts: Peru Reels From The Debilitating Impact of El Niño As Blueberry Prices Soar
By
| 28 September 2023
In this installment of the ‘Agronometrics In Charts’ series, Sarah Ilyas studies the state of the Peruvian blueberry season. Each week the series looks at a different horticultural commodity, focusing on a specific origin or topic visualizing the market factors that are driving change.
The heat brought on by the El Niño weather phenomenon is choking the Peruvian blueberry supply. Abnormally high temperatures in Peruvian growing regions have delayed production by 5-6 weeks, leading to a gaping hole in supply. “The drop in volume for the 2023/2024 season will be much greater than the 10% or 15% predicted by Proarándanos; the drop will be around 30% or 35% in volume, depending on how it develops up to December. I believe that what some agribusiness companies are going to do is extend the campaign until January, February, and March, taking advantage of this last cold period that we have left. In this way, they will try to get into the Chilean window, which ends in April, ” says Alfredo Lira Chirif, general manager of Agrícola Cerro Prieto, one of the main blueberry exporters in Peru. Lira notes, “This, which some agribusinesses in Peru have already been doing, could mean recovering a little volume, in order to finish the campaign with 20% or 25% less volume in April, as long as there are no further rains due to the El Niño phenomenon.”
Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)
Since Peru has established itself as the predominant supplier to the United States, the substantial decline in production this year carries significant repercussions. The US is expected to be devoid of real supply until at least week 41. Subsequently, the supply chain is anticipated to gradually ameliorate. Blueberry production in the Pacific Northwest and Michigan has already concluded, while imports from South America remain sporadic and unpredictable. Stepping into October, a gradual improvement in volume originating from Mexico and Peru is expected while prices are expected to remain elevated for at least a few more weeks. High prices are turning consumers off blueberries and demand is down as a result. “While the price is expected to be high for the next five to six weeks, we need to transition to lower prices as soon as the supply situation improves. It is important to get the consumer back to buying blueberries,” says Evan Pence with Always Fresh Farms.
Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)
Despite the significant reduction in supplies, the prevailing shortage is primarily driven by the pack size. Over the years, the industry has shifted towards larger pack sizes, with 18 oz. clamshells becoming the standard, compared to 10 to 15 years ago when 4.4 oz. packaging was customary. “While we are trying to get product into small clamshells, it appears to be extremely difficult for Peru to transition to smaller packaging. Since we can’t get product into small clamshells fast enough, some retailers won’t have any supply until the situation starts to ease in about five to six weeks,” remarked Pence. In contrast, Mexico exhibits greater flexibility and a readiness to accommodate 6 oz. packaging, thereby positioning itself as a pivotal player in the provision of blueberry supplies to the United States market for this year.
Last season posed significant challenges for Mexico, as the robust supplies coming in from Peru were accompanied by aggressively competitive pricing, which had a disorienting effect on Mexican suppliers at the beginning of the season. This year, Mexico finds itself in a better situation. Another noteworthy development involves the entry of Argentina into the arena. Despite the exorbitantly high shipping costs attributable to air transit, Argentina has spotted an opportunity to export higher volumes to the United States during this season.
Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)
In our ‘In Charts’ series, we work to tell some of the stories that are moving the industry. Feel free to take a look at the other articles by clicking here.
All pricing for domestic US produce represents the spot market at Shipping Point (i.e. packing house/climate controlled warehouse, etc.). For imported fruit, the pricing data represents the spot market at Port of Entry.
You can keep track of the markets daily through Agronometrics, a data visualization tool built to help the industry make sense of the huge amounts of data that professionals need to access to make informed decisions. If you found the information and the charts from this article useful, feel free to visit us at www.agronometrics.com where you can easily access these same graphs, or explore the other 21 commodities we currently track.
Written by: Sarah Ilyas
Related Stories
