The sector, which employs 24,000 people, closed 2014 with a slump in sales that made it the worst year of the past three decades. Companies also consider it difficult to replace Russia with other markets in the short term.
In a normal season, Catalonia produces 400,000 tonnes of peaches and nectarines, of which 75% is intended for export. The two countries that bought more peaches in 2013 were Germany and Russia. Russian President Vladimir Putin introduced a ban on fruit imports in August last year as a result of the crisis in Ukraine. The peach campaign was still at about 50% when the borders closed, thus resulting in the worst crisis in decades, since there were no alternative markets. This year, growers are facing the first campaign in which Russia "does not count as a market," because the border will remain closed at least until August. Everyone within the sector agrees that a year with similar results to 2014 would be an unprecedented disaster for the industry.
Pere Roqué, president of the Association of Agricultural Employers of Lleida and the Young Growers Association (AEALL-ASAJA) has almost ruled out the Russian market. "Even if the borders re-opened, the Russians have devalued their currency and the citizenship is unlikely to have the necessary purchasing power to buy our fruit," he laments. Roqué rates 2014 as the worst year in fruit marketing of the past three decades. "The 24,000 jobs normally created, taking into account both the harvesting and processing of the fruit in Lleida, are hanging by a thread. If this year's campaign goes wrong, we can forget about receiving the necessary funding in 2016 and the sector could be touched by death."
Manel Simón, CEO of the Fruit Businesses Association of Catalonia (Afrucat), says that this year the sector is coming in better shape than last season. "In 2014, the harvest was ahead and there was more supply than demand, prices dropped and then the Russian veto made matters worse," he affirms. Simón assures that, for now, the campaign is meeting all prospects.
Replacing Russia with other markets is difficult. "We had been working for nine years to consolidate ourselves in the Russian market and it was taken from us overnight," regrets Simón, adding that trade agreements have been signed with Colombia, Brazil, Saudi Arabia and most recently Singapore, Malaysia and Hong Kong. The latter, he says, are "very distant destinations where we can only ship by air to ensure the fruit arrives in optimal condition, which is expensive."
"Asia is not as accessible as Russia and logistics are very expensive"
Josep Lluis Trilla, commercial director of Actel, one of Lleida's leading cooperatives, agrees with Simón on the fact that this campaign has so far been more positive than last year's. To Trilla, consumption in Europe is essential. "As long as temperatures are high, people will eat fruit, but if there are any considerable drops in demand, things will become difficult," he warns. Actel's commercial director does not believe the Asian market is an alternative, since in his opinion "air travel is too expensive. By sea, ships take 40 days to arrive, and in China, which is the largest country in the area, we have no phytosanitary protocols signed."
The head of the sweet fruit department of the Growers Union, Xavier Gorges, is facing the season with optimism, but aware that "the new markets will never be as accessible as Russia." The head of the sweet fruit department at Jarc-Coag, David Borda, warned that the Russian market may have been lost forever, since "competitors have appeared, like Turkey, which has trade ties with Russia, or countries like Algeria and Morocco, which have preferential agreements with the EU."
