Zanesco and Eberhöfer: "Apple marketing in the 2021-22 season"
FRUIT LOGISTICA 2022 – VIP AT 360 DEGREES
The marketing of apples in the 2021-22 season is facing a number of developments that reduce accessible market opportunities and negatively impact the profitability of production. Ever since Prognosfruit's forecast in August 2021 and then with the autumn harvest, it was clear that this season would see significant volumes available in Europe, with greater market tension than in the last two years.
This has unfortunately become a reality and the presence of large volumes of small sizes has put pressure on these references for most varieties, a situation progressively aggravated by logistical tensions and persistent export difficulties.
In recent months, a barrage of geopolitical factors has hit the market, once again reducing outlets for European production. The embargo on food products from Belarus from the first of January 2022, followed a few weeks later by the introduction of new payment/exchange methods in Egypt (L/C) had slowed down the decumulation of Eastern European production. The recent war between Russia and Ukraine has caused further severe logistical, price and raw material availability tensions, as well as a lack of consumer confidence in future economic developments, with a consequent reduction in consumption to counterbalance inflationary tension.
In particular, the issue of rising costs is having a strong impact on the sector, and production will not be able to fully absorb the inevitable increases, having to carry them at least partially to distribution and consumption.
So, if the overall picture is unfavourable, sales are in any case proceeding along the lines of the destocking schedule planned by VIP at the beginning of the season, with different dynamics for the various references.
"Regarding conventional fruits – affirms the Commercial Manager Fabio Zanesco – the varietal picture is diversified, considering that the Gala season is now over, with a trend that was generally dynamic. For the rest, we are a couple of weeks behind the original schedule, due to the events of the last few months and less than enthusiastic consumption, but we are confident that we will be able to regain this during the high season and in the coming months. What is certain is that the medium-large sizes have a regular and satisfactory trend for all varieties, while on the small and second-class I am concerned that there will not be sufficient outlets for all the apples that are on the market today. One positive fact is certainly that we expect fewer apples arriving from the Southern Hemisphere in Europe, due to logistical complications and high costs; we notice that our customers are focused on European product at the moment, which can definitely provide some interesting business opportunities. Outside Europe, some destinations are performing well, such as India with Red Delicious, but most markets are stagnant and the very expensive freight often knocks us out of the market or severely reduces the volumes we can load".
"Now we are starting, with April, an interesting two-month period, also in terms of references – points out Fabio Zanesco – mainly destined for the European market, such as Pinova and Bonita, and we will complete the campaign of the main Club apples, namely Envy™, Ambrosia™ and the great novelty Cosmic Crisp®, launched at the end of February and which has covered a first 'test' commercial season on the main markets. Kanzi® will continue to be marketed until mid-June, in line with expectations. Regarding club apples, we can say that the campaign was satisfactory, although it cannot be denied that the market was partly weighed down by an excess of small sizes, which do not find the right value in the premium segment”.
“The consumer in this segment expects a perfect product in terms of size as well – VIP's Commercial Manager emphasises – and as important as it is to focus on taste, we notice that it is difficult to find new commercial space at the top of the price scale. We will certainly have to work better on segmentation and involve our customers and consumers more strongly in varietal innovation projects".
Moving on to the organic market, the picture is partly different, although the events and difficulties impacting on consumption, costs and distribution are the same.
Gerhard Eberhöfer, the Organic Product Manager, emphasises: "For the first time we have exceeded the important threshold of 50,000 tonnes of production and this certainly represents a considerable challenge, but the current specific conditions of the European organic market make me moderately optimistic for the second half of the season. More than half of our production was sold as planned by the end of March, and apart from Golden and Red Delicious (which represent a lower overall share compared to conventional, but currently do not have sufficient outlets in the fresh market), plans for the coming months are higher than expected. It must be said that, also thanks to the reduced harvest in Germany and Switzerland, demand is sustained, and we also note a positive re-orientation of European retailers towards continental organic rather than looking at imports from Southern Hemisphere countries. Since a few days we have started marketing Topaz, Pinova and Bonita, which we are saving for spring-summer in order to guarantee continuity and the right product for the improving climate".
"We are working daily to ensure the best quality up to the new harvest – Eberhöfer points out – in the short but especially in the medium-long term, thanks to the choice of varieties suitable for keeping and storing until August. In this context, it is obvious that the window of business opportunities for organic productions imported by ship from more distant countries will progressively shrink in favour of regional and European products. The organic market is progressively segmenting and therefore we are also introducing innovative apples such as SweeTango®, Kanzi®, envy™, Ambrosia™ and Cosmic Crisp®. The Cosmic Crisp® is an absolute newcomer and the marketing will start at Easter with a portfolio of very few selected customers and will gradually expand in the coming years".