World blueberry production and consumption/production et consommation mondiale du bleuet Rémy Lambert, Ph.D. George K. Criner, Ph.D.

Transcription

1 World blueberry production and consumption/production et consommation mondiale du bleuet Rémy Lambert, Ph.D. George K. Criner, Ph.D. Wild Blueberry Producers Association Nova Scotia, 2014

2 World blueberry production and consumption La production et consommation mondiale du bleuet Lambert and Forest Lavoie s study. Factors influencing market price in Québec Prices in Maine affect the prices in Québec Highbush prices affect wild blueberry prices Inventories of (all) blueberries have an important impact on the wild blueberries prices. Level of production in Québec?? Temperature (frost.) Markets are connected / Substitutes (Wild-Highbush)

3 World blueberry production and consumption La production et consommation mondiale du bleuet q Main economic forces that shape all industries, including blueberry industry: Supply (producers) Demand (consumers) Market structure (ex: pure comp, monopoly, etc) Structural adjustments (ex: Cnd-US agreement, Korea-Canada, new technologies, etc )

4 Forces économiques: l offre / Economic forces: Supply Production Large producing totale des countries principaux Total pays Blueberry producteurs Production (TM) (MT) In 1990: 10 producing countries In 2008: 20 producing countries In 2012: 24 producing countries US +6,07% Can +5,65% ROW +4,44% Chile États-Unis d'amérique Canada Chili ROW

5 Forces économiques: l offre / Economic forces: Supply Small Production countries totale blueberry des pays Production petits producteurs (MT) (TM) Allemagne Mexique Pays-Bas Espagne Sources: (FAO)

6 Forces économiques: l offre / Economic forces: Supply International Blueberry Exports (TM) 7 years X 9 14 years X 1.75

7 Forces économiques: l offre / Economic forces: Supply Index of export and production volume of blueberry on the international market 1990 =

8 Forces économiques: l offre / Economic forces: Supply Blueberry export on the international market without Chile (MT) ÉU % Canada 5.41% ROW Sources: (FAO)

9 Forces économiques: l offre / Economic forces: Supply Blueberry Exportations export on des the principaux international pays producteurs, market including incluant Chili Chile (Tonnes) (MM) Export Ratio Chile = 83% (cf SimFRUIT) Chile Export Ratio Cdn-US 20-25% (cf FAO) US Can États-Unis d'amérique Canada Chili

10 Conclusion on International Supply / Conclusion sur l offre internationale Since 1990, world production has increased nearly 4 fold; Since 2005, it has almost doubled; Production has exploded in some countries such as Chile; Blueberry exports have increased more rapidly than the world production ; Markets are highly connected; Prices of wild blueberries on the international market are highly influenced by highbush blueberry prices, and the quantities produced ; US + Canada + Chile = 95% of the world production.

11 La demande internationale / International Demand Import volume of main importers (MT) Environ 48 pays (stable)

12 Economic Forces: Supply and Demand / Forces économiques: Offre vs Demande Exportation derived prices (nominal US$) Canada-US Corrélation de 68% Can + 6,7% US+ 5,2% Chili =? International prices have increased due to the development of the demand

13 Economic Forces: Supply and Demand / Forces économiques: Offre vs Demande Index of export prices and CPI (1991 = 100) Export prices CPI

14 La demande internationale / International Demand Consumption per capita, Canada En 2009 US : 0.67 Kg/capita Cdn : 2.04 Kg/capita Cdn Increase : % : % In 2000 US : 0.32 Kg/capita Cdn : 0.97 Kg/capita Elasticity Price : to Income : 1.5 and ++

15 La demande internationale / International Demand Impact of 1% increase in the Gross National Product (GNP) on the increase of blueberry imports Country % US 3.00 France 2.06 Netherlands 2.02 Austria 1.95 Canada 1.68 Germany 0.71

16 La demande internationale / International Demand Typical blueberry consumers (AAC, 2012) 55 years old and older; Asian Income $50,000 and + (70% of blueberry consumers). Cf: AAC May Bureau des marchés internationaux

17 Croissance de la Demande et Segmentation / Increasing Demand and segmentation World Population Age and income distribution: Population will be an important factor for blueberry demand PS: Growth in demand can be achieved by increasing per capita consumption, or by developing new markets

18 Changes in the distribution of major age groups in the world Évolution de la répartition (%) des grands groupes d âges dans le monde Source : Thierry Eggerickx et Dominique Tabutin, Introduction au colloque international de l AIDELF

19 Enjeux actuels et futur immédiat / Current issues and immediate future World demand and supply will continue to increase Which one will increase faster? If demand grows faster: Prices will continue to rise Demand increases can be achieved by increasing the per capita demand (ex US), and also by the development of new markets If supply grows faster: Prices will decrease Growth continues in Canada and the US. However, the growth is very important in other countries (South Am....)? There is a market of older and richer people (Asia, China )

20 Structural Changes and market structure Les changements structuraux et structure de marché Chile: Has increased its production by 20% per year in recent years In 2005, produced 5000 MT, but only 500 MT were sold on the frozen market Today, Chile sells around 30% of its production on the frozen market since margins on the fresh market have decreased; Dole Chile is planning to become one of the country's main blueberry exporters (1M kg in the next 3 years) Argentina: Exports volume will increase (80% of production); Wants to position itself as an export market leader, in a cost increasing and price decreasing environment; Will not be able to compete with Peru on the fresh market; Will position itself on the frozen market. (ComFRUT), FRUITPlaza, Martin Maldonald, category manager

21 Structural Changes and market structure Les changements structuraux et structure de marché Uruguay: Mexico: Peru Increased its production by 40% in 2014 over 2013 (mostly exported) (CF: FreshPlaza) Jalisco positioned itself as a regionally important blueberry producer (FreshPlaza); 2000 ha in production under best agronomic conditions; In 2014, plans to add 2000 ha. Potential competitor on the fresh market (Asparagus growers in Peru switching over to grapes and berries); Camposol has unveiled its plans to become one of the largest suppliers of blueberries to customers in the UK and Europe

22 Structural Changes and market structure Les changements structuraux et structure de marché Australia: COSTA: Construction of a modern freezing facility for berries including blueberries ($3.4 million) Carsol Europe = Cie from Chile located in Europe to be close to its consumers. Wants to increase its sales in Europe and Asia. (cf freshplaza) There is no predicted market saturation in in Europe since the demand continues to increase (Cf: Carsol Europe)

23 Structural Changes and market structure Les changements structuraux et structure de marché Substitutes for wild blueberries == Rubel blueberries. Market strategy: ("wild" "higher antioxidants than other blueberries") Rising labor costs and ease of mechanization (lower harvesting costs) will encourage more and more countries to produce frozen blueberries (highbush), hence an increase in competition for wild blueberries With the prospect of lower prices of highbush blueberries (high output growth) highbush blueberry producing countries may wish to diversify their risk by splitting production between frozen and fresh (Imp: evidence suggest shift from fresh to frozen (impact on prices))

24 Conclusion To remember Blueberry market is evolving rapidly; Highbush blueberries will continue to compete with wild blueberries ; Production is increasing in several countries; These new producers are export oriented; International demand is increasing; The demand for blueberries seems to be inelastic, but income elasticity seems to be high; The future lies in the development of new markets with older and richer consumers; Competitors will position themselves on several markets; It is expected that some countries will shift more berries onto the frozen market to reduce their risk (less likely that both prices be low at the same time ); New competing products (eg. Rubel).

25 Other Concerns and Possible Next Steps Concerns Exponential growth in supply means market can become unstable World demand strong now, but events do not assure continued global economic growth (issues with China, Russia, and economic stagnation in Europe) Key issues: Demand and Supply (Cost vs Price Vs Profit) Possible next steps Continue to improve data availability Monitor growth of supply and demand (highbush as well wild!) Continue to refine demand models to help forecast Seek range of market outlets to expand per capita consumption

26 Vision In the future, we must think outside the box and find optimal coordination of the sector?.. Competitors are certainly there! Think INNOVATION in all its aspects! (New product, Innovative business partnership, Industry coordination (Cnd NAm.?), etc..)

27 Some word on: Forest Lavoie Project - logistics and price differences

28 Forest Lavoie Project - logistics and price differences Overall objective Analyze and document the factors explaining the differences between the prices of wild blueberries in Quebec, New Brunswick, Nova Scotia and Maine

29 Forest Lavoie Project - logistics and price differences Specific objectives Assess the proportion of price differentials that can be explained by the higher transport costs due to the distance between the blueberry and freezing plants Assess the proportion of the differences that can be explained by the difference in the quality of wild blueberries (eg. production without pesticides vs with pesticides during the harvest year) Make recommendations on possible improvements to the supply logistic and to the publication price

30 Forest Lavoie Project - logistics and price differences The project is in working progress Identify and illustrate the geospatial location of production units and processing plants as well as the volumes produced by producing and processing zones within each study area done Collect and compare the price differences observed on the last ten years for the selected regions (Quebec, New Brunswick, Nova Scotia and Maine) almost done Assess the reliability and the accuracy of the published prices (reliability, authenticity and precision) in progress Describe and document the various marketing systems and supply logistics to freezing plants of wild blueberries for the different areas in progress.

31 To reach us: Rémy Lambert, Ph.D Full professor FSAA Université Laval George K. Criner, Ph.D Full professor, School of Economics University of Maine Orono. USA