Mexican blueberries gain share in the US market
Seeing that 2021 is being billed as the year of fruits and vegetables, it is logical that we start the year with a kind of dispute.
Domestic blueberry carriers are increasingly concerned about the increasing level of imported blueberries being used. The problem revolves around the fall of the markets due to the overlap of domestic and imported products. While the majority of imported blueberries come from Chile and Peru, Mexico is the country currently in the sights of growers.
Blue Book has partnered with Agtools Inc., BB #: 355102, the data analysis service for the produce industry, to see what the data shows for a fruit or vegetable in 2021.
Let's take a look at the blueberry season as a whole to start, to better understand how the season works between the domestic and imported markets.
Below is the total volume of US blueberries for the past 5 years.
Volume has increased more than 16 percent since the 2016 season and has grown steadily over the past four years. Breaking it down even further, we can see the main producing regions that blueberries come from in 2020:
At first glance, it would appear that there is very little overlap between the domestic and import seasons. However, when we start looking at market share, a different story emerges. Look at the chart below.
Domestic market share has dropped a few percentage points compared to imports during the peak growing season, yet lions still hold market share (almost 80 percent).
In combination with the import season, the domestic volume has remained very constant, while the import season has captured most of the volume needs based on the changing frequency of consumer purchases.
So where does the concern lie? Mexico While Chile and Peru continue to meet most of the import season needs, Mexico is beginning to move into the national growing season.
The impact is lower prices and lower returns to farmers, causing many long-time blueberry growers to worry about their ability to survive if Mexico continues to drive the market south.
Look below the 10 regions with the highest volume of production in 2010, 2015 and 2020. Mexico does not appear until 2020, when it ranks third among all regions that bring volume to the US.
In 2010, Mexico accounted for 4.7 percent of the total volume used in the U.S. By 2020, that number had risen to 17.1 percent, but look a bit more at what the statistics don't show.
Watch the moment the volume drops below 1 million pounds at the start of the national season. Each year it comes back later and later, intruding even more on the national season.
Five years ago, it fell below the May 1 mark, while last year's volume topped the mark through mid-June.
Now look later in the year as the national season is winding down, Mexico is breaking the 1 million pound mark in early October (2020) rather than early December, as it did in 2015.
In the Report on Seasonal and Perishable Products in the US Trade, Charles Hall of the Georgia Fruit and Vegetable Growers Association testified: “In the last twenty years, imports of fresh produce from Mexico have grown tremendously. … The pattern has now shifted from undermining our producers to "financial and competitive health, threatening the very survival of our industry."
Bill Brim of Lewis Taylor Farms, a blueberry grower in Georgia said in the same report: “In 2015, when we started to see changes in markets and prices due to… the increase in Mexican imports, for 2018, pressure from imports was so strong that it almost had to close. We are barely holding on today.
Look at the volume of Georgia in 2015 compared to Mexico:
Now watch it in 2020:
A suggested article in the same report calls for more retail support during the national season. However, when we look at retail prices for blueberries in 4 main regions, the domestic season is the most aggressive time of the year with the exception of the Northeast.
So where is the answer?
Like most arguments, somewhere in the middle. While the argument can certainly be made in favor of domestic producers, the bottom line is that they cannot handle the growing consumer demand for supplies throughout the year, and imports will continue to play an important role in the solution.
However, as Mexico continues to squeeze the national season from both extremes, it will certainly be something to watch out for this fruit and vegetable year.
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