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<title>Eurofruit Magazine RSS Feed</title><link>http://www.asiafruitmagazine.com/index.html</link><description>Fresh comment from Eurofruit Magazine</description><dc:language>en</dc:language><dc:creator>michael@fruitnet.com</dc:creator><dc:rights>&#xa9; Market Intelligence Ltd</dc:rights><dc:date>2010-05-01T14:23:13+01:00</dc:date><admin:generatorAgent rdf:resource="http://www.realmacsoftware.com/" />
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<lastBuildDate>Tue, 18 May 2010 12:11:34 +0100</lastBuildDate><item><title>Asiafruit Magazine brings you the fresh 10</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2010-05-01T14:23:13+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/asiafruit_brings_you_fresh_10.html#unique-entry-id-24</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/asiafruit_brings_you_fresh_10.html#unique-entry-id-24</guid><content:encoded><![CDATA[John Hey


As you will probably noticed from our front cover, your bimonthly guide to what&rsquo;s happening in Asia&rsquo;s fresh fruit and vegetable business has just become monthly (more or less).   With effect from this May edition, Asiafruit Magazine has moved from its traditional publishing schedule of six times a year to 10 times a year.


It&rsquo;s now almost exactly 15 years since Asiafruit Magazine set out with a mission to provide you with news and information about the fresh fruit and vegetable markets in Asia.   We&rsquo;ve been pleased with how that mission has progressed, and it&rsquo;s a reflection of how far this trade has come and how briskly the region&rsquo;s markets have developed that we find ourselves ready to ramp up our publishing frequency.


The move to 10 editions will enable us to provide you with more regular and more relevant coverage of what&rsquo;s happening in Asian markets and their key supplying sources.   It will also mean more targeted and comprehensive reports on every major product, every major market.   For instance, where previously we ran general features on Southern Hemisphere grapes, we&rsquo;ll now be able to report in turn on prospects for Peru, South Africa, Chile and Australia in editions tailored to these countries&rsquo; seasonal timings.   Similarly, individual markets around the Asian region will benefit from bigger spotlights in specific editions.   To download a full copy of the editorial programme, visit www.asiafruitmagazine.com.


The fact Asiafruit Magazine is also now available online means that you can read the latest issue on the day it is published via our Digital Edition.   At the click of a mouse, you can search for stories you want to read first or get in touch with our advertisers to source the products they&rsquo;re promoting.


You will also see in this edition that we have updated our news and regulars sections to bring you fresher information and comment on what&rsquo;s happening in the Asian business &ndash; and to synchronize Asiafruit Magazine with our online news services Fruitnet.com and Asiafruit Newsline.


We hope that you enjoy the more regular flow of news and information from Asiafruit Magazine, and we look forward to receiving more regular input to our pages from you, our readers.]]></content:encoded></item><item><title>Time to look afresh at Malaysian market</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2010-03-01T15:26:26+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/look_afresh_at_malaysian_market.html#unique-entry-id-23</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/look_afresh_at_malaysian_market.html#unique-entry-id-23</guid><content:encoded><![CDATA[John Hey


I&rsquo;m looking forward to gaining a deeper understanding of the opportunities and challenges facing Malaysia&rsquo;s fruit and vegetable business at Fresh Produce Malaysia on 15-17 March, but what is already apparent from our special report in the March/April of Asiafruit Magazine is that this market has evolved to a point where the spotlight is timely.


Only a few years ago, Malaysia&rsquo;s fruit import market was often disparaged as a &lsquo;dumping ground&rsquo; by suppliers who bemoaned buyers&rsquo; obsession with getting the lowest price.   While still noting the need to trade with caution, those same suppliers are now identifying interesting opportunities for higher-quality lines in the upper end of the market.   A few forces appear to be driving this change.   Malaysia&rsquo;s solid economic foundations have given rise to one of Asia&rsquo;s most affluent populations, which, while not large, is nevertheless young, health-conscious and keen to try new imported products.   Meanwhile, a phalanx of foreign-invested retail chains is reaching out to these consumers, and this &lsquo;modern trade&rsquo; has the infrastructure and interest to bring in a broader range of produce.


As such, those suppliers who are prepared to make a concerted effort to develop the market and promote their produce are now reaping the benefits.   For instance, the retail training seminars run last year by the Washington Apple Commission revealed the scope to partner with the emerging modern retail trade.   Kiwifruit marketer Zespri has also made inroads over the past year with a programme of in-store and above-the-line activities, while Korean strawberries have scored similar success.


Malaysia&rsquo;s own position as a supplier of fruit and vegetables to global markets also warrants fresh attention.   Factors like lack of suitable farmland and higher labour costs compared with neighbouring tropical fruit-producing nations such as the Philippines or Thailand may have traditionally led big corporates to overlook Malaysia as an investment opportunity, but the growing support from government agencies for the sector has boosted prospects.   Innovative new products like the Paiola papaya and premium varieties of greenhouse vegetables are putting suppliers on the right path to tap into high-end markets at home and overseas, and with the proper supply chain systems and marketing strategies in place, Malaysian produce can gain greater recognition worldwide.   Fresh Produce Malaysia is a good platform to provide just that!
]]></content:encoded></item><item><title>Reasons for cheers ahead of Chinese New Year</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2010-01-01T11:31:09+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/ca41b86657ac310e87d1942231f4bb88-22.html#unique-entry-id-22</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/ca41b86657ac310e87d1942231f4bb88-22.html#unique-entry-id-22</guid><content:encoded><![CDATA[John Hey


Asia&rsquo;s fruit import trade is gearing up for Chinese New Year (CNY) on 14 February, but as our in-depth preview reveals (Asiafruit Magazine January/February 2010), the year of the tiger looks likely to be ushered in with more of &ldquo;a low growl than a triumphant roar&rdquo;.   Indeed, while it remains the high point of the fresh produce sales calendar in Asia, CNY these days fails to raise the same excitement levels among the trade that it once did.   In certain more mature markets, such as Taiwan, there&rsquo;s even a nostalgic tone among wholesale importers who reflect on how sales that once leapt 10-fold now increase only two-fold.   Some of them attribute the decline to a generational shift, noting that younger people prefer to spend their money on other luxuries or on travelling abroad during CNY rather than the traditional custom of spending time at home with the family, and money on gifting fresh fruits. 

While there is some credence to this argument, which is echoed in other places like Singapore, it also reflects a broader loss of lustre for those markets, and it does not hold true for every country in Asia.   With a region so complex and diverse, the question of whether CNY is growing or depreciating in importance depends on the perspective.   In mainland China for instance, consumers are more traditional in observing this major event.   Trade of imported fruits into China is expanding at a healthy clip, and the gift-giving market is an integral part of this growth.   It&rsquo;s a similar story in Vietnam. 

The timing of CNY, which can vary significantly from year to year, adds another twist to this difference of perspective.   This year, it falls later than usual, and the longer build up may help to explain the current sedate mood among buyers.   The variable timing conversely keeps a keen sense of anticipation among suppliers, some years falling favourably for their products, other years not.   CNY happens to coincide with Valentine&rsquo;s Day this year, and that could provide a further boost to sales of items like cherries and berries, at least for those who can supply product late enough.   Interestingly it&rsquo;s these kind of high-value products that have been enjoying increased demand in Asia, not just for gift-giving but for general consumption.   And those in the trade who lament the lack of a spike in demand for CNY nowadays should also take heart from the way imported fruits have become more of a year-round purchase in Asian markets, not least for younger consumers. 
]]></content:encoded></item><item><title>How to deny the fickle finger of exchange rates?</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2009-11-01T12:38:58+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/62629d4083b20348ba1e9c27714619a3-21.html#unique-entry-id-21</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/62629d4083b20348ba1e9c27714619a3-21.html#unique-entry-id-21</guid><content:encoded><![CDATA[John Hey


The fickle finger of exchange rates has rocked the produce trade over recent months, turning the tables for global suppliers.   This time last year, Southern Hemisphere exporters such as Australia and New Zealand were buoyed by a slump in their currencies against the surging US dollar.   With most deals in Asia done in US dollars, or in local currencies that mirror its movement, the strong greenback made these suppliers much more competitive in the region.   Alas, such exchange rate relief appears to have been a short-lived result of the financial crisis, which saw the hot money flee to the relative safety of the US dollar.


The greenback has since reversed course, leaving these Southern Hemisphere suppliers to watch in dismay as their currencies climb again.   The contrasting fortunes are underlined in the November/December edition of Eurofruit Magazine, with the weaker US dollar boding well for shippers of California navels or Washington apples, but signalling a tough season for key Southern Hemisphere exporters getting into stonefruit or grapes.


It&rsquo;s easy for exporters to get despondent about exchange rate volatility.   After all, there&rsquo;s little they can do to mitigate the impact, but global suppliers should draw consolation from the more steady trends in Asia&rsquo;s produce trade that stand out in this issue.   The growing purchasing power of Asia&rsquo;s twin engines of economic growth &ndash; India and China &ndash; is becoming clear.   If we take apples, for instance, domestic shortages in India are fuelling impressive import growth, while China&rsquo;s hungry domestic market is pushing up prices and hitting its exports.   Although China&rsquo;s supply footprint across South East Asia remains large, its internal demand and rising prices are creating opportunities for other global suppliers to the region&rsquo;s markets where consumers are broadening their horizons.


In another encouraging trend, suppliers and buyers are now responding to these  opportunities by building partnerships to ensure products are effectively promoted to the consumer.   The modern retail trade is a good platform to introduce new items, but Asian retailers need supplier-support to realise the benefits to their bottom line of selling a high-value product like cherries for instance.   Whether it be Zespri&rsquo;s kiwifruit push in Malaysia, Australian stonefruit promotions in Thailand or a generic campaign for US fruits in Indonesia, a little supplier push can trigger the consumer pull that takes the game beyond a price contest decided by the fickle finger of exchange rates.]]></content:encoded></item><item><title>Research key to China&#x27;s development</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2009-09-01T12:40:12+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/research_key_to_chinas_development.html#unique-entry-id-20</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/research_key_to_chinas_development.html#unique-entry-id-20</guid><content:encoded><![CDATA[John Hey


These are tough times for China&rsquo;s fruit export sector.   Much of the pressure is coming from a hungry domestic market, which has in certain cases driven up prices to the point where export hardly seems like a risk worth taking.   Throw in rising production and compliance costs, more price-conscious export markets and a strong currency that is squeezing returns &ndash; and you can see why fewer suppliers are taking that risk nowadays.   It&rsquo;s a far cry from a decade ago when China was leveraging its labour cost advantage to foray into some of the world&rsquo;s most demanding markets, notably with its bagged Fuji apples to Europe.   Back then, the export sector enjoyed strong government support, but the funding focus now appears to have switched to spurring domestic consumption. 


Or has it?   Just as China&rsquo;s role in the international marketplace appears to be receding amid rising costs and lack of innovation, there&rsquo;s a vast amount of work going on in research institutes across the country on plant genomics and varietal development that could redefine its direction as a supplier in the future. 


With its diverse climate, low production costs and large agricultural base, China is often seen by international plant breeders as an opportunity to introduce their new and/or superior varieties to produce higher value products, but the most exciting varietal developments appear to focus on what could come out of China itself, rather than what might be brought in.   China&rsquo;s huge biodiversity and rich repository of germplasm make it an Aladdin&rsquo;s cave for finding and developing new products.   And China is ploughing remarkable resources into breeding and selection that are well funded, managed and targeted, reflecting the government&rsquo;s policy to boost rural wealth.   


At a time when varietal development in many parts of the world is stunted by lack of funding or resources, China&rsquo;s major focus on this field, and the opportunity for commercialisation of new varieties, present good scope for foreign entities to engage with these research bodies for mutual benefit.   Government support for initiatives that involve foreign funding tends to be strong, particularly when they&rsquo;re designed to lift rural incomes.   With their capacity to create wealth, new varieties fit the bill, and could replace low labour costs as one of China&rsquo;s next great competitive advantages.]]></content:encoded></item><item><title>Asian markets packed with promise</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2009-07-01T11:20:39+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/asian_markets_packed_with_promise.html#unique-entry-id-19</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/asian_markets_packed_with_promise.html#unique-entry-id-19</guid><content:encoded><![CDATA[John Hey


This month marks the biggest-ever edition of Asiafruit Magazine &ndash; a bumper issue to mark what promises to be another bumper show for ASIA FRUIT LOGISTICA and Asiafruit Congress.   It may seem like a daunting task producing a magazine of such large proportions, but we had no problems filling the pages, so great is the volume of news pouring forth from the world&rsquo;s fastest growing market for fresh fruit and vegetables, and so strong is the interest among global suppliers and buyers vying for a share of the trade.


Many of them will be out in force at ASIA FRUIT LOGISTICA and Asiafruit Congress.   Australia, whose exports have enjoyed a strong showing in Asia this year, has expanded its pavilion by a third.   Other key trading nations such as the US, China, France and Holland have also beefed up their presence while Chile and Brazil are making their debut appearances &ndash; and our TRADE CHILE Special brings you in-depth coverage of the country&rsquo;s growing focus on Asia.   These are just a few of the 30 nations that will be represented among the 200-plus exhibitors.   They will meet with trade visitors from across the world looking to source new products, meet new customers and find out where the market is moving.


Visitors to the show will find plenty on offer.   From a consumer market perspective, most Asian nations have weathered the economic crisis well and present excellent marketing opportunities.   China and Vietnam are two good examples profiled in the magazine.   Asia&rsquo;s aspirational consumers are trading up in their produce purchases, a trend revealed by the rising demand for products such as seedless grapes, cherries and organics.   And the region&rsquo;s growing modern retail trade is a great place to capture these shoppers &ndash; as our interviews with senior buyers from ParknShop, Tops and NTUC Fairprice show.   Asia also holds big sourcing potential, and this edition provides a flavour of the myriad of products on offer, from staples like Chinese apples through Thai exotics and Vietnamese dragon fruit to newer lines like pomegranate arils from India.   Indeed, opportunities abound on both sides.   Of course there are challenges to overcome and there is a lot to learn, and the Asiafruit Congress plays a key role as a forum to debate the big issues.


Asia is vast, vibrant and diverse &ndash; a bit like the latest edition of Asiafruit Magazine &ndash; so part of the challenge is knowing where to start.   I hope I&rsquo;ve given you some guidance on the edition, and that the trade show provides you with the pathway to the markets &ndash; those that commit to them are bound to reap the benefits. ]]></content:encoded></item><item><title>Wake up and smell the bananas</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2009-05-01T13:01:54+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/wake_up_and_smell_bananas.html#unique-entry-id-18</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/wake_up_and_smell_bananas.html#unique-entry-id-18</guid><content:encoded><![CDATA[John Hey


Japan&rsquo;s morning banana diet craze (page 30 of this month's Asiafruit Magazine) which has seen the fruit flying off retail shelves for eight months now is an intriguing story.   While there is something uniquely Japanese about the phenomenon, it has a broader relevance when it comes to marketing to consumers in Asia.   The diet craze shows the extent to which fruit is part of people&rsquo;s lifestyles in Asia and how consumers are more engaged with dietary concerns.   Clearly if marketers can identify specific health benefits in their product that respond to these concerns and can promote them effectively, there are major gains to be achieved with this receptive audience.


Having said that, the banana diet craze occurred more due to luck than design.   And it was via Japanese social networking site &lsquo;Mixi&rsquo; that the word spread so fast.   Copycat diets launched for other fruits have yet to achieve the same impact, and engineering such a craze is a hit and miss business.


Other methods of marketing to consumers in Asia have a more consistent success rate, such as training retail store managers on how to handle, display and promote your product or in-store tastings.   This is the type of work the California Table Grape Commission conducts in many Asian markets, and a case example is with the Indonesian retail chain AlfaMart, which saw a substantial growth in California grape sales last year (page 19 of this month's Asiafruit Magazine).


AlfaMart operates convenience stores, and is adding new ones at a rapid rate, with more and more of them stocking California grapes.   Indeed, with a profusion of convenience stores opening across Asia and many carrying produce in their range, there are opportunities for suppliers to extend their consumer reach by working with such chains.


Without doubt the Asian markets offer important growth opportunities for global suppliers, particularly in the current economic climate.   And there is significant latent consumer demand in the region to be tapped through marketing and promotion.   Alas, this is a much-neglected area for most suppliers and supply countries to Asia.


A fragmented supply base and budgetary constraints are the often-cited reasons for this lack of activity.   The reality is that all too often suppliers show no interest in following their product through the supply chain, and prefer to divest ownership at port of arrival.   With a more structured approach, they would begin to open up a whole new market that comes from getting closer to the consumer.   But first they must find the right trade partners and understand the market.   Events like ASIA FRUIT LOGISTICA and Asiafruit Congress are the best place to start.]]></content:encoded></item><item><title>Complex India calls for customised services</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2009-03-01T12:25:36+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/complex_india_customised_services.html#unique-entry-id-17</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/complex_india_customised_services.html#unique-entry-id-17</guid><content:encoded><![CDATA[John Hey


On a recent visit to India, I was struck by an innovative cold chain solution for fresh produce retailing.   It consists of a refrigerated push-cart for the street vendors that dominate fruit and vegetable sales in the country.   Based on a thermal management system using passive cooling, these modernised trolleys are fitted with battery-charged refrigerated plates designed to help the street vendor deliver the best produce to the consumer, often to their doorsteps.


Here was a cost-effective cold chain service tailored to Indian conditions, something that has eluded the big corporates at the other end of the retail scale who, until lately, had been throwing up supermarkets at a dizzying rate across the country.   When these players burst onto the scene two years ago, they were going to become the panacea for the problems that plague India&rsquo;s fruit and vegetable sector.   With their grand plans to develop supply chains, they would forge a direct &ldquo;farm-to-fork&rdquo; model that would slash huge wastage levels, raise farmer incomes and close the &ldquo;service&rdquo; gap for the Indian consumer.   Pundits confidently predicted that India&rsquo;s &ldquo;unorganised&rdquo; retail market was about to be transformed by the &ldquo;modern trade&rdquo;. 


After all the hype and the hoopla, the dream seems to have turned sour, with many big players in retreat.   Managing fresh produce supply chains has proven to be a lot more tricky than they bargained for.   With India&rsquo;s fragmented production base, buying direct from the farmer is fraught with difficulty, forcing retailers to rely on the intermediaries they sought to remove.   The realisation has dawned that these middlemen often add value, not cost, and can perform tasks far more nimbly and cheaply than they can.   The so-called organised retail sector is now in disarray, and must go back to the drawing board to find a cost-efficient sourcing model tailored to India&rsquo;s complex conditions.   For instance, the cost of eliminating wastage through forging an integrated cold chain, as many players set out to do, outstrips that of alleviating wastage levels through just-in-time supply chain management &ndash; surely a more realistic model for retailers. 


In failing to master the supply chain, organised retail has failed to win over Indian consumers, who continue to cross the road to buy their fresh fruit and vegetables from the street vendor.   Indeed, rather than India&rsquo;s retail sector learning lessons from Western-style supermarkets, it appears that India has a lesson for the rest of the world &ndash; one that is particularly pertinent to produce &ndash; about the role the little man can play along the supply chain, not least in servicing the consumer.]]></content:encoded></item><item><title>Forget the speculation&#x2c; watch the specifications</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2009-01-01T12:40:13+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/forget_speculation_watch_specifications.html#unique-entry-id-16</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/forget_speculation_watch_specifications.html#unique-entry-id-16</guid><content:encoded><![CDATA[John Hey


Any notion that Asia was immune to the credit crunch has been blown away in recent months as the region&rsquo;s export-led economies suffer the &ldquo;lag-effect&rdquo; of the global slowdown.   With many companies not paying end-of-year bonuses and the threat of layoffs becoming real, Asian consumers are entering this year in a very different frame of mind to 2008.    


What the financial crisis means for Asia&rsquo;s fresh produce markets is a subject of much speculation right now.   On a global level, there is an argument the produce business is less exposed, since fruit and vegetables are part of the food chain and people will keep eating them.   When it comes to Asia&rsquo;s consumer markets, however, we must not forget that imported fruits are often a pricier purchase amid the plentiful locally-grown options, and that people tend to save money at the hint of any insecurity.   Our survey of Asian importers produced a bleak prognosis for Chinese New Year, with talk of consumers trading down and tightening their belts, but then such gloom has become the norm in recent years. 


Aside from consumer behaviour, the impact of the financial turmoil may well be felt more by the trade in terms of exchange rate volatility.   The strengthening of the US dollar, while encumbering US exporters, is making Asia&rsquo;s dollar-linked markets more attractive to Southern Hemisphere suppliers, especially as they explore alternatives to their recession-hit mainstays in the US and Europe.   In China, where the yuan has actually appreciated against the US dollar, this is worrying some importers, who warn the market cannot afford to become a dumping ground at a time when demand appears to be slowing down. 


Amid the gloom, however, we can expect to see some positives come out of the slowdown.   Securing bank credit will grow tougher for Asian buyers, but there will be more caution on the part of importers, and  fewer fly-by-nights and speculators ready to &ldquo;take a punt&rdquo;.   This can only help market stability.   Indeed, in many ways, the financial crisis will only serve to underline the core principles of doing business in the Asian markets; not least having sound business relationships and supplying product at the right time to the right specifications.   Those exporters who send product speculatively that fails to make the grade can expect to get punished severely by these markets, as buyers and consumers become more selective in their purchasing.
]]></content:encoded></item><item><title>Rural reforms hold key to China&#x27;s future growth</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2008-11-01T12:34:40+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/reforms_key_chinas_growth.html#unique-entry-id-15</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/reforms_key_chinas_growth.html#unique-entry-id-15</guid><content:encoded><![CDATA[John Hey


China's fragmented farm units have long been cited as the core stumbling block in the country&rsquo;s efforts to supply safe food and meet export market demands for consistent quality.   Under the existing system, each of China&rsquo;s 800m farmers is allocated their own patch of land by local authorities under 30-year leases, but they have no legal title and they cannot transfer the land, even if they move away.   This has given rise to a patchwork of tiny plots across the country.   The miniscule size of these land-holdings, often less than 0.67ha, means farmers can only grow a very small volume of product, making it hard to run them profitability.   To maximise production, farmers must swap chunks of land to be held in common by the village, meaning there are fewer incentives for them to make improvements.   The system also renders it very challenging to source consistent lines of produce for export, since product for one container load may come from scores of farmers.   And it certainly helps to explain the food safety problems that continue to plague China&rsquo;s international image, most recently with the scandal over melamine in infant formula.


In this context, the Communist Party&rsquo;s October announcement that it will give rural residents the right to transfer or lease their land seems like a radical and timely overhaul.   While stopping short of privatisation, it enables farmers to convert their 30-year land leases into money, which can be invested into new businesses.   Supporters of the move suggest it will spur investment in rural areas and foster the development of large-scale and efficient farming.


As ever, though, such a transformation is not as straightforward as it sounds.   Some pundits note that the latest announcement essentially marks a re-statement of previous reforms unveiled in 2003, and that many farmers are already informally renting or swapping their land.   These observations suggest the move would have a negligible impact, but other analysts predict that it would spur a mass migration to cities as farmers sell off their plots to seek better-paying work in the cities.   From that point of view, the reforms could actually threaten food security and put pressure on urban infrastructure.   The government has, however, stipulated conditions on land use rights to prevent this urban influx.   Either way, there are valid concerns that the move towards a privatised system exposes uneducated farmers to exploitation by a landlord class, and could leave them to drift into the cities rootless and impoverished.   Such complications hint at the huge challenges to implementing the plan, which are only exacerbated by internal discord in the Communist Party over the extent of the reforms.   Indeed, a big question mark hangs over whether the government will go ahead with the plan at all.


The fact remains, however, that China must do something radical to enrich the countryside in order to close the massive income gap between the rural and urban populace, and to stimulate an economy that is coming under pressure from the global downturn.   With two-thirds of the population living in rural areas, getting these farmers to spend a little more money could go a long way to making up for the loss of manufacturing export trade into the US and Europe.   Indeed, the potential to grow internal consumption, coupled with the modernisation that may result from the rural reforms, underlines China&rsquo;s untapped potential for the global fresh produce trade, both in terms of procurement and market opportunities.  ]]></content:encoded></item><item><title>Asia&#x27;s trade convention offers food for thought</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2008-09-01T12:06:14+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/asia_convention_food_for_thought.html#unique-entry-id-14</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/asia_convention_food_for_thought.html#unique-entry-id-14</guid><content:encoded><![CDATA[John Hey


Walking the floor of this year&rsquo;s ASIA FRUIT LOGISTICA trade fair in Hong Kong, it was impressive to see so many different countries represented among the exhibitors and visitors.   And the substantial growth recorded by this year&rsquo;s event certainly reflects the global interest in Asia&rsquo;s fruit and vegetable market. 


Such massive appeal is no doubt fuelled by Asia&rsquo;s huge population and by its examples of spectacular economic growth.   Some of the region&rsquo;s rising stars, like India and Vietnam, came under the spotlight in the conference hall at the Asiafruit Congress, but there were words of caution from certain speakers for those eyeing the Asian markets.   Des O&rsquo;Rourke of Belrose Inc warned against overenthusiasm, stressing that Asia is a complex and multi-faceted market that cannot be approached with simple marketing models.   He also cast an air of economic realism on proceedings, pointing out that only one country in Asia has a big population AND large Western income levels &ndash; and that is Japan.  


The results of a recent survey of Asian buyers conducted by Asiafruit Magazine, which were presented at the Asiafruit Congress, revealed that the region&rsquo;s markets are &ldquo;under-serviced&ldquo; in terms of imported fruits, with global suppliers lacking local understanding and still tending to prioritise other destinations.   An expert panel of global suppliers to Asia also testified to the difficulties of servicing the diverse demands of these markets. 


The message was clear; the Asian markets require long-term commitment, but the final day of the Asiafruit Congress, which highlighted China&rsquo;s rise as a consumer market, provided an incentive to &ldquo;hang in there&rdquo;.   With pressures building on land and resources and some 200m people set to relocate from rural to urban areas over the next 10-15 years, China will struggle to feed itself, delegates heard.   As John Chapple of Sino Analytica noted, China is already a net importer of agricultural products in cash terms &ndash; and he tipped it to become a domestic market supplier and an importer when it comes to fresh produce too, thus challenging traditional threat perceptions over China&rsquo;s role as an exporter.   The multiple Chinese companies promoting their products at ASIA FRUIT LOGISTICA seemed to counter his assertion.   Indeed, other conference speakers noted that &ldquo;a battle for acres&rdquo; in China&rsquo;s agriculture sector might prompt a shift in production towards higher value crops, such as fruit and vegetables.   And with its huge diversity of native fruit species, China has great potential to offer new and unique products to the world market. 


But it&rsquo;s an interesting notion, and key retail executives speaking at the Asiafruit Congress revealed how a trend among several countries to consume more food than they can produce is encouraging big multinational retailers to pursue global sourcing strategies in order to secure consistent, safe and high-quality supplies.   This move is sure to have a major impact on fresh produce suppliers in Asia and beyond over the coming years.]]></content:encoded></item><item><title>Asian markets on brink of major changes </title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2008-07-01T14:25:48+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/asian_markets_brink_of_changes.html#unique-entry-id-13</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/asian_markets_brink_of_changes.html#unique-entry-id-13</guid><content:encoded><![CDATA[John Hey


Hong Kong is often described as one of Asia's most international cities, so as we gear up for the Asiafruit Congress there, it's worthwhile glancing at what impact some of the major &ldquo;global&rdquo; issues of the day &ndash; from the credit crunch to rising food costs &ndash; are having on Asia's fresh produce business. 

The global food &ldquo;crisis&rdquo; has been keenly felt across Asia, where soaring prices of staples like rice and wheat are driving inflation rates.   Rising living standards in India and China are often cited as one of the key factors in upsetting the food supply/demand equation, and the produce trade has also begun to witness their power as consumer markets &ldquo;kick in&rdquo;.   Over recent years, global fresh produce suppliers have been casting nervous glances towards China and India, anxious that these powerhouses of production would become marauding export giants, but the latest signs are that both countries will have their work cut out to meet internal demand for fruit and vegetables in the future. 

While the rising cost of staple foods such as rice stands to affect spending on high-value fruits across Asia, recent trends reveal that many consumers are &ldquo;trading up&rdquo; in their produce purchases, as the rising sales of seedless versus seeded grapes bear testimony.   Further evidence of more sophisticated consumer demands can be found in the nascent interest in organic produce across the region.   Traditionally, 'organic' has barely registered on consumers' radars, and significant hurdles remain to market development.   However, food safety concerns and health trends are spawning interest in the concept.   The environment too could become more of a factor in people's purchasing decisions in the future, as events like the Beijing Olympics, branded by the local government as &ldquo;a clean-air event&rdquo;, raise awareness of the dire problems at stake. 

As for the credit crunch, Asia has weathered the impact of soaring inflation to shrug off the worst effects of this global malaise to date, but surging fuel and energy prices pose a serious economic threat.   Low energy and shipping costs have underpinned the growth of China and Asia's other export-based economies, so the recent price hikes, coupled with weakening global demand, could very easily undermine the region&rsquo;s manufacturing models.   When it comes to the fresh produce trade, rising transport costs may render more distant origins of imported fruits, such as Latin America, a less attractive option for Asian buyers, while making the increasingly affluent domestic market a more attractive option for producers in China and India. 

Clearly, the Asian markets are on the cusp of some profound changes that challenge many of the &ldquo;received&rdquo; ideas about the region.   And such rapid evolution is sure to generate much lively debate at the Asiafruit Congress in Hong Kong.]]></content:encoded></item><item><title>Can Japan&#x2019;s &#x2018;designer&#x2019; fruit ride the Cool wave?</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2008-05-01T12:43:39+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/can_japan_ride_cool_wave.html#unique-entry-id-12</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/can_japan_ride_cool_wave.html#unique-entry-id-12</guid><content:encoded><![CDATA[John Hey


In his first speech to the Diet (parliament), Japan&rsquo;s former PM Shinzo Abe pledged to formulate the Japanese Cultural Industry Strategy, which would &ldquo;boost the competitiveness of areas that represent the good traits and uniqueness of Japan and present them to the world&rdquo;.   It&rsquo;s more likely he was thinking of &ldquo;areas&rdquo; like film, fashion, art or animation rather than fruit.   For the country&rsquo;s role as a cultural exporter and global trendsetter has flourished in recent times.   The leading manufacturer of goods like cars, cameras or stereos is now fast becoming the world&rsquo;s foremost creator of &ldquo;Cool&rdquo; &ndash; from Pok&eacute;mon to Issey Miyake. 

But Mr Abe&rsquo;s words might easily be applied to the country&rsquo;s fresh fruits, which represent a form of art and are certainly  &ldquo;unique&rdquo;.   In fact the Japanese government is now on a mission to &ldquo;present its fruits to the world&rdquo; through trade fairs and other promotional vehicles.   This push forms part of its broader multi-million dollar campaign to double the country&rsquo;s food &ndash; and fruit &ndash; exports within five years.  

It&rsquo;s an ambitious target, and sceptics have singled out the sky-high prices of Japanese fruits as a sticking point to their catching on in world markets.   But these exceptional prices reflect the exceptional methods used in growing the fruit, which often result in products with exceptional appearance and flavour.    Japanese growers spend considerable time and energy creating better and better varieties, as well as carefully nurturing each piece of fruit on the tree or vine.   The result is a luxury product like no other, which explains why it is so often presented as a gift. 

With the growing purchasing power of Asian economies, and consumers elsewhere in the world increasingly seeking out something unique in a commodity-led market, people may well be ready to pay the premium for this delicious &lsquo;designer&rsquo; fruit. 

Indeed, the major challenge is unlikely to lie so much in market acceptance as in the operational and logistical issues of getting this fruit to market.   The industry has to establish an efficient supply chain to service new markets beyond the tried and tested destinations like Taiwan and Hong Kong.   For all the money the government is ploughing into the export push, it is unlikely to achieve its goals unless the actual growers and exporters can be engaged in a coordinated strategy.   With their traditional focus on the domestic market where consumers still pay a premium for their prized locally-grown fruits, few growers are geared up for export, so a change in mentality is required.  

Interestingly, a key driver of the government&rsquo;s campaign is to revitalise rural Japan, where an ageing population of farmers is threatening the country&rsquo;s ability to supply consumer demand for local produce.   Even if the campaign falls short of its export target, it may well succeed in lifting local supplies at a time when anxieties about the safety and integrity of imported products appear to be as strong as ever. ]]></content:encoded></item><item><title>Rise in costs signal change in China&#x27;s role</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2008-01-01T16:53:14+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/rising_costs_chinas_role.html#unique-entry-id-11</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/rising_costs_chinas_role.html#unique-entry-id-11</guid><content:encoded><![CDATA[John Hey


Is cheap Chinese produce set to become a thing of the past?   Is the country losing its competitive advantage as an exporter?   Certainly, a sharp increase in the country&rsquo;s fresh produce prices over the past year has led people to wonder. 


The farm-gate price of Chinese Fuji apples, which have come to symbolise the country&rsquo;s rapid rise as a produce exporter, is up by around 30 per this year.   When combined with a jump in seafreight costs, this is leading to market prices in Europe that are 50 per cent higher than last year, and resulting in limited demand.   While a drop in this season's apple production partly explains the price hike, there are other forces at work here, and apples are not an isolated case. 

Soaring food prices drove Chinese inflation to its highest level in more than a decade in October, with fresh vegetable prices leaping 30 per cent from a year earlier.   As the consumer price index keeps climbing, suppliers note that the cost of everything is going up in China, including that of key inputs like fertilisers and packaging.   In particular, the cost of labour is rising at double-digit rates.   The appreciation of the Chinese currency, the yuan, and sharp increases in shipping costs are further eroding the country&rsquo;s competitive edge in export markets, while the government&rsquo;s move to tighten quarantine export controls has caused complications for shippers.   At the same time, domestic demand is taking off as Chinese incomes rise.   And speculation among traders is only bumping up prices as they store fruit in anticipation of a hot local market for the upcoming Olympic games.

  

So what does this all mean for China's role as a fresh produce exporter?   While a slowdown in growth rates appears inevitable, the country's supply role is also changing.   China has made inroads into export markets on  a low-cost strategy, often gaining "share of throat" without increasing "share of wallet".   But recent figures show that total fruit export volumes plateaued in 2006, while values increased 22 per cent, reflecting rising costs and a greater focus on quality and value-adding.  

From the perspective of fruit imports to China, the rising cost of domestic fruit should have a positive impact in maintaining overall market prices at high levels.   However, this is likely to spur more Chinese producers to explore the domestic market and to raise their quality standards, ultimately intensifying competition.   As a result, we can expect to see a hardening of the trend whereby imported fruit boasting outstanding quality commands a handsome premium, but any product that is slightly "off-top" takes a big step down on price, as many suppliers have found out to their cost over recent months. ]]></content:encoded></item><item><title>New varieties to spice up kiwifruit category</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2007-11-01T15:22:00+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/new_varieties_kiwifruit_category.html#unique-entry-id-10</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/new_varieties_kiwifruit_category.html#unique-entry-id-10</guid><content:encoded><![CDATA[John Hey


TURN to our kiwifruit feature this month and you will read about some of the new varieties that are generating excitement in the category.   Zespri Gold excepted, the global kiwifruit market has been something of a &lsquo;monoculture&rsquo; up until today, with green-fleshed Hayward by far the dominant variety.   But the sector looks set for a burst of innovation and major diversification over the next decade as new varieties with gold/yellow, red and other coloured flesh emerge onto the scene to rival or compliment Hayward.

Many of these varieties are originating from China, where multiple strains grow naturally in the mountains and are brought to horticultural institutes for development.   Major foreign interest and investment in nurturing and commercialising such cultivars is now beginning to produce results with the launch of varieties bearing interesting points of difference to those currently on the market, whether it be a striking appearance when cut open, higher sugar levels or enhanced health benefits. 

While they still only account for a fraction of  total production, the big commercialisation plans for these varieties mean it will be interesting to see what influence they have on the global market.   In China itself, securing adequate protection of privately-owned varieties to ensure controlled market development is always going to be a challenge, particularly where cultivars have already been accessible to growers before plant variety rights were secured.   On a broader scale, such new varieties must also live up to expectation levels in the competitive international market, especially in terms of factors such as shelf life.

As Zespri notes, the investment in research, development and commercialisation of a new variety is hefty.   Indeed, it took several years for the New Zealand kiwifruit marketer to come up with Zespri Gold.   Despite rumours that it is well on its way to developing a red kiwifruit variety, Zespri remains conspicuously quiet on its plans, and it may be waiting for the right time to launch such a cultivar while Gold continues to ride high in the marketplace. 

Zespri does, however, sound a note of concern that there will be new varieties that do not have the characteristics to satisfy the trade or consumers in the short-term.   While the recent burst of innovation should expand the kiwifruit category, it could also destabilise it.   After all, variable eating quality remains one of the key hurdles to realising the great growth potential that exists for kiwifruit consumption.   Before Hayward is branded a tired, commodity variety, we should also take heed of the distinct quality grades within the Hayward market, the difficulties consumers have discerning them when fruit &lsquo;looks&rsquo; so similar, and the room for improvement that this reveals.       ]]></content:encoded></item><item><title>Quality at what price?</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2007-09-01T10:37:46+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/quality_at_what_price.html#unique-entry-id-9</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/quality_at_what_price.html#unique-entry-id-9</guid><content:encoded><![CDATA[John Hey


ONE of my personal highlights from the recent ASIA FRUIT LOGISTICA trade fair in Bangkok was sampling the delectable array of fruits in the Japanese pavilion.   Not only did these items look amazing, they set the taste buds racing, whether it be muskmelons with a melting sweetness or purplish-black, perfectly-formed Pione grapes bursting with  a rich flavour.   If only all fruits tasted this good, I thought, the industry might not be facing such a challenge to boost global consumption!   I was even more blown away, however, when told that the melon I was munching would cost me upwards of US$100 in Japan, or the pretty peach US$10 each.   Makes five-a-day a bit of a challenge! 

Those Japanese fruits are notoriously expensive, largely due to the extraordinary lengths that growers go to in nurturing their crops.   Back in the conference room, the issues of price and quality kept cropping up at the Asiafruit Congress.   Will Japanese consumers still pay a premium for fresh produce?   Some thought so; others not.   Are the expanding supermarket retailers in Asia prepared to share in the cost of programmes to promote socially responsible management practices or food safety by paying more for the produce they buy?   Has China&rsquo;s method of winning market share on low price forced it into a commodity trap or is it shifting to more value addition?   And what is more important to the Asian consumer: quality or price?

&ldquo;Price, price, price&rdquo; was the answer from one respondent in a survey of Asia&rsquo;s fresh produce business conducted by Asiafruit Magazine, the results of which were presented at the Asiafruit Congress by Rabobank.   But some delegates countered that Asian consumers are actually value-conscious in general, which is not surprising when they often have an abundance of inexpensive, good quality local fruits at their disposal. 

Delegates could find an answer to this question of price or quality in Bangkok itself on a tour of the city&rsquo;s diverse range of retail outlets.   At the upmarket Central Food Hall visited by delegates, there were premium-quality fruits selling at prices to match.   And while this store obviously appeals to the top tier of society, it nevertheless reflects the segmentation that is increasingly being seen in Asian markets as affluence grows in the region.   Thailand is a market where low-priced, &ldquo;acceptable&rdquo; quality Chinese fruit has made major inroads, but it is also one where high-quality fruits from sources worldwide are finding favour by offering new flavours to the aspiring consumer.]]></content:encoded></item><item><title>World waking up to Asia&#x27;s potential</title><dc:creator>michael@fruitnet.com</dc:creator><dc:subject>Home</dc:subject><dc:date>2007-07-01T15:15:36+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/world_waking_up.html#unique-entry-id-8</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/world_waking_up.html#unique-entry-id-8</guid><content:encoded><![CDATA[John Hey

&lsquo;Fast moving&rsquo; and &lsquo;fast growing&rsquo; are terms often used to describe the Asian fresh produce market, and the news and developments that pack the pages of this bumper edition of Asiafruit Magazine  bear testimony to such rapid evolution.   With so much of the world&rsquo;s population and economic growth concentrated in Asia, the region&rsquo;s consumer market is set to become the largest in the world.   China and India may be the drivers of this development, but other countries  such as Vietnam (see p140-145) are also emerging fast. 

Meanwhile, a wave of consolidation is sweeping the produce trade in Australia and New Zealand (see p62-83), which has recently witnessed a flurry of mergers and acquisitions as well as the rise of production initiatives with a focus on scale and efficiency.   Such consolidation is being driven by the demands of the local retail chains.   But it also reflects a push to compete more effectively in export markets amid difficult trading conditions characterised by strong currencies.   At production level, Australasia has seen a growth in corporate farming, while major marketers are partnering with private equity firms to fund strategic growth.  

China&rsquo;s food safety record has hit the headlines globally over recent months, following a string of health scares (see p120-121).   The most high-profile cases involved tainted food exports to the US, where media reaction has been somewhat sensational, but there is no doubt that food safety is a thorny issue for many Asian countries.   Certainly, Asian consumers are becoming more concerned about food safety and responsive to branding.   Our Organics Asia special (p117-128) shows  that shoppers are warming to the concept that once left them cold.   However, the organic sector still faces many hurdles in Asia, ranging from a lack of genuine supply to poor certification systems.  These issues are linked to the broader problems of regulating production and achieving food safety assurances in Asia, which in turn stem from the fragmented supply base and a lack of supply chain management.   However, the development of initiatives such as ThaiGAP (see p30-34) and Metro&rsquo;s sourcing project in Vietnam (see p144-145) are helping to tackle such issues. 

Indeed, growing interest among international companies in Asia&rsquo;s fresh produce sector is set to inject impetus to the bid to address these problems.   As this year&rsquo;s wide-ranging Asiafruit Congress programme reveals, big-brand fruit  marketers, multinational retailers, major market research companies and world-leading breeding and R&D organisations are all stepping up their focus on the region.   The launch of ASIA FRUIT LOGISTICA, Asia&rsquo;s first produce trade fair, this year provides the platform to bring the world trade together and promote further progress.  ]]></content:encoded></item><item><title>Feeling the heat from climate change</title><dc:creator>michael@fruitnet.com</dc:creator><category>Asia Pacific</category><dc:date>2007-05-01T15:11:37+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/feeling_the_heat.html#unique-entry-id-7</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/feeling_the_heat.html#unique-entry-id-7</guid><content:encoded><![CDATA[John Hey

On a recent world trip, I visited  a UK basking in its warmest April on record and a New York nipped by cold wind and rain (no spring in sight), before returning to a drought-stricken Australia via Beijing, which was enjoying the earliest arrival of summer in 35 years.   While &lsquo;global warming&rsquo; is all too easily cited today when we experience weird weather patterns, there is  a growing body of evidence to link the unsettling meteorological scenes of the modern age with climate change. 

The fresh produce trade in Asia has been affected by a series of extreme weather events in recent years, ranging from a record number of typhoons in Japan in 2004 to the hard freezes that hit citrus growers in Australia and California in 2006/07. 

While such weather events look set to strike more frequently as the world gets warmer, another mounting issue facing farmers is that of water shortages.   Australia&rsquo;s devastating drought now heralds a crisis for its fresh produce growers, who may not have water to irrigate their crops in the coming months (see p8).   Such dry conditions, while part of an El Ni&ntilde;o weather pattern, are set to become more common with global warming  &ndash; and other countries should pay heed.   China&rsquo;s Yangtze River is running at record-low levels for instance, with drought hitting the country&rsquo;s citrus crop in 2006/07.   Indeed, a recent major Chinese government report on climate change predicts that the Yellow and Yangtze rivers, which support the  country&rsquo;s richest agricultural regions ,will initially experience floods and then drought as the Tibetan glaciers melt over this century.   It adds that water scarcity and extreme weather events are likely to slash national crop production in the  decades ahead.   Despite these dire warnings, the Chinese government has declared that economic growth must take priority over cuts in its huge greenhouse gas emissions.   China&rsquo;s economic growth is keenly watched by produce suppliers worldwide, and some may be encouraged by the government&rsquo;s priorities, eyeing the rise of a huge market with a shortage of domestic crops.   But there may be no China market left in the long-term, if, as looks possible, cities like Shanghai and Beijing are submerged by a one-metre rise in sea levels caused by the melting of parts of Antarctica!

Climate change is becoming  a very real issue for  the global fresh produce trade.   Growers must address the threat to their existing production systems, adopt greener practices and lobby their governments on the issue.   As the environment becomes an increasingly important factor in consumers&rsquo; purchasing decisions, marketers also need to adapt &ndash; not only  to meet increased demand for organic produce, but to correct misinformation and misconceptions about &lsquo;food miles&rsquo; and the impact of global fresh produce sourcing on the environment. ]]></content:encoded></item><item><title>Convenience is king but consumer is confused</title><dc:creator>michael@fruitnet.com</dc:creator><category>Global</category><dc:date>2006-09-10T12:01:51+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/convenience_confusion.html#unique-entry-id-6</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/convenience_confusion.html#unique-entry-id-6</guid><content:encoded><![CDATA[John Hey

The UK and the US are often said to lead the world in supermarket retailing, and supermarkets have become the mainstay of grocery shopping for their cash-rich, time-poor consumers.   Yet for all the convenience of the one-stop shop, consumers appear to be more confused than ever when it comes to buying fresh produce in these markets.    

Food safety is now a major concern for consumers worldwide, who are constantly bombarded with mixed media messages on the issue.   In the absence of clear information at point of sale on the origin of produce and what&rsquo;s been sprayed on it, more US and UK shoppers are plumping for &lsquo;organic&rsquo;.   But even this category suffered a blow recently when a Dallas Morning News investigation in the US found serious breaches of national organic standards among USDA-certified products (see Americafruit Magazine, Aug/Sep 06).   If the USDA isn&rsquo;t protecting its own organic label, then who can consumers trust if they want organic products? 

In the UK, meanwhile, consumers are receiving media messages that local produce is &lsquo;greener&rsquo; than organic.   This is all part of the ethical eating movement with its injunction to &lsquo;buy local&rsquo; to cut food miles, which are harming the environment.   Supermarkets have been stirred into action, running big promotions for local produce, but it is their centralised systems that have largely replaced local markets.   These are the same retailers that have long been touting to consumers the notion of buying any fruit you want at any time of the year from all corners of the globe, which is one reason why finding produce grown in your region in the UK can now present a challenge &ndash; and may only yield a stick of rhubarb! 

Working out what&rsquo;s the &lsquo;best buy&rsquo; on fresh produce can also be confusing for shoppers in today&rsquo;s UK supermarket.   Entering the produce aisles, you&rsquo;re likely to be presented with dozens of &lsquo;offers&rsquo;.   But once you&rsquo;re looking at particular items, price comparisons may be difficult.   &lsquo;Buy one, get one free&rsquo; (bogof) is especially common, and a big draw, but when you stop to analyse the &lsquo;offer&rsquo;, it often turns out that it&rsquo;s not such a good deal after all, and you feel like telling the vendor to &lsquo;bogof&rsquo;!   Of course, the lure is you don&rsquo;t have to work it out &ndash; you&rsquo;re told you&rsquo;re getting a good deal.   Just like all the pre-packs, which save you having to pick your own produce; it&rsquo;s all done for your convenience.  

The drive for convenience has benefited the fresh produce industry in many ways, prompting innovation, technological advancements and better consistency and availability.   But in markets where &lsquo;convenience is king&rsquo;, other factors have clearly been compromised in the process.   UK consumers often complain that supermarket produce looks flawless, but lacks flavour; they bemoan the dearth of alternatives to supermarkets; and even if they found one, they may not know how to select a piece of fruit.   Meanwhile, supermarket suppliers complain of poor returns and difficult trading terms.   It&rsquo;s easy to understand why farmers&rsquo; markets are gaining ground in the UK and the US.]]></content:encoded></item><item><title>Asian produce trade develops apace in 2006</title><dc:creator>michael@fruitnet.com</dc:creator><category>Asia Pacific</category><dc:date>2006-11-10T11:58:14+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/asian_trade_develops_apace.html#unique-entry-id-5</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/asian_trade_develops_apace.html#unique-entry-id-5</guid><content:encoded><![CDATA[John Hey

As 2006 draws to a close, it&rsquo;s worth reflecting on a year in the Asian fresh produce trade that has thrown up some interesting developments.

Unsurprisingly, China remains the driving force in the region.   Fruit and vegetable prices in China have shown a double-digit upturn during 2006 over the previous year, reflecting both rising production costs and increasing consumer demand (and incomes).   In particular, an &ldquo;off-year&rdquo; for Chinese apple crops in 2005/06 saw domestic prices scale heights that made export a far less attractive option.   In contrast to the familiar image of China as a marauding, low-cost exporter, such examples signal that the country may struggle to satisfy demand from its own consumers in the future.   Indeed, while low prices continue to drive China&rsquo;s export expansion, volume growth has slowed down this year, while values have risen.   Its export mix is also changing &ndash; traditional bulk likes such as garlic remain important, but new speciality lines are coming to the fore as China turns its labour-cost advantage to value-adding and innovation.   China&rsquo;s increasing production costs should not be overlooked however, and rising fuel prices are a key issue, especially as so many of the country&rsquo;s best growing-regions are located some distance into the interior.  

Food safety issues also continue to trouble China&rsquo;s export trade, with Japan&rsquo;s Positive List System (PLS) for maximum chemical residue levels (MRLs) impacting heavily on the vegetable industry.   While the PLS has caused confusion and upheaval for Japan&rsquo;s import trade, it could benefit consumers in the long-term as it brings Japan&rsquo;s MRLs into line with EU and US standards.

Meanwhile, South East Asian countries have been facing an influx of low-priced Chinese produce under regional free trade deals, with farmers in Thailand and Vietnam feeling the heat.   Nevertheless, some good opportunities are clearly developing for high-value items in these markets. 

The shift from tariff- to quarantine-based import restrictions in Asia has continued, with Indonesia introducing new rules, Taiwan toughening its stance on pests and Thailand mulling a move towards market regulation.

  

The modern retail trade has also made further inroads across the region.   Even India, the final frontier for global retailing, now appears to be poised for a retail revolution led by local corporate giant Reliance.   This market will be &lsquo;one to watch&rsquo; in 2007, as will Vietnam, whose entry to the WTO is set to create new opportunities for retailers and the fresh produce trade alike.]]></content:encoded></item><item><title>Big freeze shakes up Asian markets</title><dc:creator>michael@fruitnet.com</dc:creator><category>Asia Pacific</category><dc:date>2007-01-07T11:56:46+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/big_freeze.html#unique-entry-id-4</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/big_freeze.html#unique-entry-id-4</guid><content:encoded><![CDATA[John Hey

Barely is 2007 underway and fruit import markets across Asia have already been rocked by a major event in the form of the California freeze, which has reportedly ruined most of the state&rsquo;s citrus crop.  While initial estimates of 70 per cent crop damage may prove to be exaggerated, the domestic market looks set to absorb most of the remaining crop at high prices, leaving very little fruit for export destinations in Asia.   By the end of January, navel orange prices had soared in several Asian markets as buyers scrambled to find alternative sources of fruit, with Egypt, Spain, Cyprus, Turkey and Israel all being explored. 

The implications of the event are perhaps most serious for Korea, the top export market for California navels.   Before the freeze, it was  forecast to take 135,000 tonnes, but the import deal may now be over before it had really begun.   The problem for Korea is that its quarantine restrictions are so tough that the alternative supply options are very limited.   Spain is the only other source of citrus with market access at this time of year, but the import protocol, with its requirement for fruit to be cold-treated, is likely to deter most suppliers.   In reality, Korean retailers will be forced to stock their shelves with other fruits like Philippine bananas and pineapples and Chilean grapes.  The same kind of products are set to profit in Japan, where alternative citrus suppliers such as Israel and Florida are unlikely to make up the shortfall in US orange imports. 

In China, meanwhile, local navels may just meet demand for the upcoming Lunar New Year festival, but supplies were already becoming tight in late January as the season approached its end.


Clearly, the big freeze is set to create a range of opportunities for suppliers of citrus&nbsp;&ndash; and indeed other fruits &ndash; to Asia.   But the event is something of a mixed blessing for the citrus category as a whole.   Southern Hemisphere citrus suppliers are no doubt looking forward to entering an undersupplied market by the time their season begins, but they may also face the challenge of winning back retail shelf space lost to other products.   Equally, a little bit of fruit from every alternative citrus source could quickly add up to an oversupply situation in some Asian markets.  

As for Asian buyers, the freeze is only likely to compound the difficulties of sourcing consistent lines of good-quality fruit that they&rsquo;ve been facing in recent times, what with a freeze-bitten Australian citrus crop in 2006, a rained out US grape deal and generally disappointing performances from many other products.   Asia&rsquo;s burgeoning consumer markets are being underserved by the fruit trade &ndash; and the weather is a key factor. ]]></content:encoded></item><item><title>India trade gains fresh momentum</title><dc:creator>michael@fruitnet.com</dc:creator><category>Asia Pacific</category><dc:date>2007-03-01T11:56:11+00:00</dc:date><link>http://www.asiafruitmagazine.com/files/india_gains_fresh_momentum.html#unique-entry-id-3</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/india_gains_fresh_momentum.html#unique-entry-id-3</guid><content:encoded><![CDATA[John Hey

The roving microphone, wielded by conference moderator Chris White, was really doing the rounds at Fresh Produce India (see p24-29).  The lively discussion and keen audience participation underlined the fact that in India &lsquo;there&rsquo;s always another opinion&rsquo;, but they also  reflected the buzz being generated by the big changes afoot in the country and its fresh produce industry.

It&rsquo;s four years since Market Intelligence  last hosted a conference in India, with the Asiafruit Congress meeting in Mumbai in 2003.   While that event generated plenty of debate, it was imbued with more of a sense of fatalism than excitement &ndash; a feeling that India was a land of huge potential, and always would be.   It was a mood of resignation captured by the comment of one speaker who predicted that modern forms of food retailing would never take off in India during his lifetime.

Skip to 2007 and you can&rsquo;t open a newspaper in India without reading about the latest major corporate to announce its entry to the country&rsquo;s burgeoning modern retail sector.   It is this retail &lsquo;revolution&rsquo;, coupled with the economic boom, that looks set to provide the impetus for India&rsquo;s fresh produce sector to make real strides.   Yet the speakers at Fresh Produce India were swift to counter some of the commonly-held notions about the Indian food retail sector and the market at large.   Everyone singles out the supply chain challenge, resulting from a chronic lack of infrastructure, as the key hurdle to the modern retailers that are setting up shop in India, but Rajan Chhibba of Intrim Business Associates pointed out that the real challenge will be at the front-end rather than the back-end, where they must change the way fresh produce is marketed as well as the mindset and tastes of the Indian consumer.   For instance, the Indian consumer &lsquo;eats curry, not vegetables&rsquo;, making fresh produce a value-driven purchase.   He revealed that fruit and vegetable retail in India is low margin, high cost, not the other way around.   Traditional small vendors with few overheads thrive in this climate, offering consumers a service that inspires loyalty.

Changing consumers&rsquo; behaviour may be the main hurdle for India&rsquo;s modern retail sector, but there are plenty of others to overcome  - poor infrastructure, shortage of expertise, high real estate costs to name a few.   Indeed, it&rsquo;s possible that the fledgling retail revolution will falter and fizzle out, given the size of the challenges ahead.   But this looks unlikely, as major corporates are driving the push and the momentum has already been gained.   Indeed, delegates to Fresh Produce India would have departed with a sense of the challenges and complexity of the Indian market, but a genuine optimism that the country is finally on track to deliver on the huge potential it offers. ]]></content:encoded></item><item><title>India begins to deliver on vast potential</title><dc:creator>michael@fruitnet.com</dc:creator><category>Asia Pacific</category><dc:date>2006-07-15T14:08:01+01:00</dc:date><link>http://www.asiafruitmagazine.com/files/india_begins_to_deliver.html#unique-entry-id-2</link><guid isPermaLink="true">http://www.asiafruitmagazine.com/files/india_begins_to_deliver.html#unique-entry-id-2</guid><content:encoded><![CDATA[John Hey

&ldquo;India is a land of huge potential... and always will be.&rdquo;   So a delegate once told me at a conference in Kolkata focused on the opportunity for Indian horticulture in world markets.   He was referring to the snail-like progress of the country&rsquo;s fruit and vegetable industry in addressing fundamental issues such as lack of infrastructure, fragmented production and poor quality standards.   But recent developments in India&rsquo;s fresh produce sector and food retail industry are enough to persuade even long-term sceptics that the worm has turned.

Most notably, Indian business conglomerate Reliance has unveiled plans for a US$5.6bn foray into the retail sector (see p10).   Its move serves as an example of the kind of money that is being invested by domestic companies into retailing  and agribusiness &ndash; sums that are unprecedented and more usually associated with global retail giants.   Reliance has several major issues to overcome to live up to its media billing as the &lsquo;Indian Wal-Mart&rsquo;, but if it can pull off its plans, it will improve the country&rsquo;s entire retail and horticulture sectors.   For Reliance&rsquo;s project calls for the creation of a whole new supply chain, including coldstorage facilities and contract farming.   And it is not alone, with other local retailers such as Big Bazaar, Subikhsha, Hypercity, Spencer&rsquo;s and FoodWorld seeking to form similar systems.   While the debate rumbles on as to if and when the government will open its market to multi-brand global retail groups like Wal-Mart and Tesco, local chains are already transforming India&rsquo;s chaotic retail industry. 

Meanwhile, big-hitters in the global fresh produce trade are now taking the opportunity to capitalise on India&rsquo;s vast procurement potential.   Capespan and Fyffes recently set up joint ventures for grapes and &lsquo;high-altitude fruits&rsquo; respectively, while Field Fresh, the alliance between Bharti Enterprises and European equity firm Rothschild, is also ploughing substantial investment into the horticulture sector. 

India&rsquo;s own market for high quality fruit and vegetables is also growing strongly as its middle-class expands.   Moreover, this growth is not confined to the top four or five mega-cities.   Rather, India&rsquo;s burgeoning middle-class, unlike China&rsquo;s, spans the length and breadth of the country, with studies showing that the smaller cities actually boast the largest increase in millionaire households.   Such &lsquo;B&rsquo; cities are driving demand for imported fruits, and while suppliers must deal with a restrictive import system and bottlenecks in distribution to reach their market, things are improving as the import trade has consolidated and the government&rsquo;s threat perceptions over foreign fruits have diminished. 

In short, India is beginning to deliver on its huge potential, and the time is ripe for an international conference that enables the fresh produce trade to build on this progress.   Fresh Produce India 2007, which will take place in Hyderabad on 22-24 February 2007, provides that very opportunity.


For more information on Fresh Produce India 2007, email: info@freshproduceindia.com]]></content:encoded></item></channel>
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