Cooperatives have confirmed the current "strong demand" for summer fruits, driven by high temperatures that boost consumption, although prices have not yet reached the right levels to ensure profitability. This was explained to Efeagro by the President of Cooperativas Agro-Alimentarias, Cirilo Arnandis, after taking part in a meeting with representatives of the Ministry of Agriculture, Food and Environment and of the sector (Asaja, COAG, UPA and Fepex, the Federation of Exporting Producers), where the development of the summer fruit campaign was analysed.
Cirilo Arnandis stressed that "the weather has managed to regulate the market" and "the fruit has arrived in time," allowing for any oversupply issues such as those registered last year, which were only made worse by the introduction of the Russian veto, to be prevented. "Market conditions have remained stable during the first part of the campaign," he highlighted.
"Right now, the weather is causing demand and consumption to increase," so the market is absorbing the entire supply, reports the spokesperson of the cooperatives. The problem, he said, lies in prices, which have not yet recovered and are still burdened by the 15 cold days Europe had recently, which caused a drop in consumption, as well as by Russia's announcement to extend the veto, as Russia was an important destination for stonefruits such as peaches, nectarines and Paraguayo peaches.
At this point, Cooperativas Agro-Alimentarias of Spain has asked the European Commission (EC) to immediately enforce the exceptional withdrawals mechanism once again, but this time including summer fruits.
According to Cirilo Arnandis, the Ministry also "understands" the need to reintroduce this regulation, which would make it possible to reduce the volumes in circulation to use them, for example, for processing and free distribution, as a preventive measure to prevent further declines in market prices.
The president of the horticultural sector at Cooperativas Agro-Alimentarias pointed out that this type of market regulatory mechanisms are not effective if put in place when the market has already collapsed; hence the importance of anticipating to potential problems.
The goal, he stressed, is for the sector to be able to resort to this system "if necessary", i.e. if an excess supply of stonefruit, melon or watermelon occurs in Spain, Italy and/or France, to prevent prices from falling, as this would take a toll on the profitability of producers.
Unjustified price drops
In this line, and talking about the summer fruit campaign, the technical manager of Asaja, José Ugarrio, reported that prices are going down without any valid reason, since production volumes in Spain are similar to or smaller than those registered last year, and there has also been a reduction in the supply from countries like France, Italy or Greece.
Furthermore, Ugarrio stressed that high temperatures have encouraged consumption of summer fruits and the market is absorbing everything that hits the market, which is even leading to product shortages at given times.
This year, the harvest is staggered; nothing to do with last year's situation, when oversupply caused market prices to plunge; consequently, José Ugarrio does not understand the reason for the current price levels, which even fail to cover the growers' production costs.
These pricing issues are affecting peaches, nectarines and melons, for example, and in the case of Paraguayo peaches, for which production volumes have in fact increased, and which are suffering the consequences of the closure of the Russian market, prices "have collapsed."
Watermelons have also registered sharp price drops, with producers receiving only 10 to 15 cents per kilo.
Asaja has asked the Ministry of Agriculture to put pressure on the European Union for the introduction of support measures that can act as a "safety net" and help prevent major problems in the fruit market.
Ugarrio advocates measures such as the withdrawal for processing as part of fruit and vegetable operational programmes to "be ready for what might happen," and a new European regulation to respond to the Russian veto, with new withdrawal limits for professionals, regardless of whether they are members of producer organisations.
