Peru’s fresh produce exporters are increasingly staking a claim to a share of the UK and European markets, thanks to shrewd planning and investment in new production areas and improving both product quality and packaging. But what opportunities are there for non-traditional produce exports from Peru to follow in the successful footsteps of the likes of asparagus, avocados and grapes? Produce Business UK takes a look
The Andean nation’s development as a major fresh produce exporter has come about through a range of factors, from having the right product at the right time to identifying gaps in the supply chain that are open to being exploited by a new source.
Total Exotics, a branch of the Total Produce Group, is a major importer of Peruvian fruits and vegetables into the UK; sourcing largely avocados, asparagus and mangoes. The company’s head of commercial, Nick Bainbridge, says exports of avocados in particular have taken off, largely thanks to the UK moving from a green skinned avocado market to almost entirely Hass.
“Peru has put an enormous amount of land into Hass production because the UK market demands it,” says Bainbridge. At the same time, Total Exotics is also sourcing from Peru substantial volumes of mangetout, sugar snap peas and butternut squash – products not automatically associated with the South American nation.
The fact that Peru is such a large country means it can grow all sorts of products, points out Bainbridge. “A lot of investment has gone into Peru and they have identified that they are able to fill gaps in the global supply chain,” he explains.
As such, Bainbridge says Peru is developing an increasing presence in the UK for an ever-wider range of produce, following success in mainland Europe. The country has been quick to pick up on emerging trends, such as the market for butternut squash, which is growing fast, as reported recently by Produce Business UK in an opinion piece by Tommy Leighton.
Alongside the evolution of mainstream supply, the development of a new generation of products with worldwide potential is set to contribute to the ongoing growth of Peru’s fresh produce trade, according to Agap (the association of Peru’s agrarian exporter guilds).
That range includes items Peru is less well-known for producing such as blueberries and pomegranates, plus passion fruit, granadilla, lúcuma, cherimoya, prickly pear (also known as cactus fig), golden berries (or physalis) and chillies.
Indeed, there are a vast number of Amazonian fruits grown in Peru – the most recognised of course is the açaí berry, which is largely sourced from Brazil, but there are hundreds of similar products in Peru that are not yet grown on a commercial scale.
Ana María Deustua, executive director at Agap, believes Peru-grown exotics could do well in a market like the UK. “We have exotics like granadilla, cherimoya and pomegranates, which could be very good for the UK,” she says. “The UK loves starfruit and golden berries and Peru grows those too.”
Another major factor in the development of Peru as a more diverse fruit and vegetable exporter, says Bainbridge, has been its willingness to invest in the creation of new acres of agricultural land in semi-arid regions, “I visited Peru in 2005 and I remember looking to the left and there was green and to the right and there were sand dunes,” he says. “Peru has been able to turn a lot of those dunes into productive land given its ability to tap into the mountain ranges.”
The reopening of exports to the US has also allowed Peruvian growers to plant far greater amounts of fruits and vegetables than ever before, according to Bainbridge. But future growth in Peruvian exports will depend, Bainbridge argues, on how much will continue to be invested in the sector. And that figure, he says, will depend on whether growers and importers are willing to establish further partnerships.
New production: pomegranates
Among the list of Peruvian firms already exporting to the UK and committing to investment in further production is Valle y Pampa, a relatively new business which grows asparagus, pomegranates and blueberries in the unlikely location of the ‘Pampa California’ desert in Pisco province, 240 kilometres south of Lima.
Until the company set up business five years ago, no agricultural operation existed within a 10-kilometre radius of the site in a region that had suffered considerable economic hardship, explains Valle y Pampa’s managing director Miguel Bentín.
Although most of the asparagus it produces goes to the US, Valle y Pampa exports significant volumes of pomegranates and now blueberries to the UK.
Having built up a stable pomegranate export business to the UK, Bentín expects to ship around 340 tonnes of the fruit to the British market this year, out of the 1,000t that the company anticipates exporting in total.
Although to date, blueberry supplies have been minimal (around 3-4t), a new site that is coming into production will raise to 250t the total shipment for the UK market this year, and up to an expected 600t within the next three years.
Having maintained steady exports of pomegranates to the UK for several years, Bentín is confident that similar success can be achieved for the company’s blueberries, particularly given the level of British consumer interest in so-called ‘superfoods’.
“The UK is a very interesting market for both products,” he says. “Obviously it’s a very demanding market, but we believe it is a market which sets consumption trends for healthy products and is one which, despite being mature, is in growth.”
In pomegranates, Bentín says Valle y Pampa has seen moderate, but good growth in the UK, despite the fact that it’s not always the easiest product to consume. “It’s a fruit which is far removed from the concept of convenience, eating it is a bit of a ritual,” he laughs.
Nonetheless, Peru’s global exports of pomegranates almost doubled to US$26m in FOB value last year and 10,000t in volume terms, up from US$17m or 6,000t in 2013, according to Agap. The association forecasts supply will almost triple to 28,000t by 2020.
Another value that Bentín sees in the UK market is the interest among consumers in how food they eat is produced and whether it complies with environmental and social standards.
In this area, he says Valle y Pampa is well-prepared having already achieved a considerable level of international recognition for its work, including Rainforest Alliance’s Sustainable Agriculture certification. The firm is also looking to attain the Fairtrade seal of approval.
The company has also received certification from the UK’s Sustainable Water Industry Group (SWIG), which recognises sustainable practices regarding water use, and is currently participating in a Life Cycle Assessment (LCA) project for its asparagus and pomegranate production in collaboration with the Department of Environmental Science of the Pontificia Universidad Católica del Perú. In fact, Bentín says one area of the study has already been peer-reviewed and is due to be published shortly in the Journal of Cleaner Production.
All of these studies, he says, have together become an important asset for Valle y Pampa, with the ultimate aim being that the information eventually reaches consumers and acts as a means of differentiating its offer.
“We’re a medium-sized company, but we believe that in the long-term this will provide us with a significant sustainable business because it’s costly to maintain it from one day to the next,” explains Bentín.
Investment in innovation
Like Valle y Pampa, Ica-based AgroVictoria, is a major exporter of pomegranates to the UK. The company, which also produces table grapes, avocados and frozen asparagus, focuses on marketing Wonderful-branded Golden Pom pomegranate fruit and arils.
According to the company’s Arturo Zaldívar, AgroVictoria’s pomegranate exports have proven to be dynamic in overseas markets, singling out the UK, Europe and Canada as having strong demand for the product, followed to a lesser extent by Russia and South East Asia, which he views as having great potential for the coming years.
Last year, AgroVictoria produced an estimated 2,500t of pomegranates and Zaldívar forecasts that this will rise to 300 containers (5,000t) for the 2015/16 season. He is also confident of further growth in volumes in the future.
In spite of what he describes as difficult market conditions and the El Niño weather phenomenon that threatens to make its impact felt, Zaldívar is confident AgroVictoria will continue to increase its supply and is investing accordingly.
“We are in the midst of investment in our facilities – harvesting and preparing more than 650 containers of fresh grapes in four months, followed by more than 300 containers of pomegranates – it’s not an easy task,” he admits.
This investment is being backed by work to develop new varieties and Zaldívar says AgroVictoria’s mission going forward is to become one of the most innovative companies of its kind in the fresh produce sector.
Fresh pepper promise
Much like its southern counterpart, Gandules is a company, based in the northern Peruvian region of Lambayeque, which has been developed specifically with exports in mind. The company’s main production plant in the region focuses on a full range of products, from fresh to frozen and processed, with bell peppers and table grapes among its strongest export products, according to Gandules’ executive president, Juan Varilias.
“We’re the largest exporter, I would guess in the whole of Latin America, of bell peppers among a range of 12 products,” he explains.
“To date, we have focused on processed peppers, but we are investing in new areas of production for the fresh market.”
The company also ships significant volumes of grapes (Flame, Red Globe, Crimson, Superior and Thompson) to countries across Europe, as well as the US and Canada. Although Gandules is not yet present in the UK, Varilias is confident that entry to the market can be achieved in the near future.
Other products supplied by Gandules include Galia melons, mangoes (fresh and frozen) and avocados to 200 markets worldwide. In the latter case, the products are marketed and distributed on behalf of smaller growers rather than being produced by Gandules itself.
Looking further forward, Varilias says the company is working as a partner in the development of new quinoa-based products, with a particular focus on new, ready-to-eat solutions.
“The agricultural industry is one of the most innovative industries in the world – the products that are developed are in keeping with the demands of consumers and what they want to have are products that are easier to consume, which means we have to keep innovating in order to have products that are ready to eat,” he says.
Introducing new technology in its facilities, packhouses and in the fields with a view to having available new production and packaging options is designed to make the business more competitive in overseas markets.
“We continue to look for modern solutions, such as packaging, as a means of improving our competitiveness as that will enable us to enter markets like the UK and the rest of Europe,” Varilias concludes.