Every year Luscious Fresh uses a window of four months in which the company export fresh sugar snaps and snow peas from China to Europe. David, the export manager, explains: “each year we ship 4,000 tons snow peas and sugar snaps to Europe (to export markets including Europe, Australia, Canada). All of these are hand picked at our two farms in Yinan and Gansu Province. After the financial crisis in 2008, export to Europe decreased considerably. We were not hit as hard because we do not focus on low value products, such as garlic and ginger, but on high end fresh products. We ship to Europe three to four months a year. In the other month we cannot compete with other countries like Egypt. After Christmas, Egypt brings sugar snaps on the market at a very low price. We try to fill gaps in the market with our products. There are two main gaps: firstly from April until the end of June and secondly from October until Christmas. During these months countries are unable to supply and prices are about €10 per kilogram”.
“The European market is one of the strictest markets regarding food quality and safety, probably the world second strictest after Japan. We realised that if we successfully wanted to supply European buyers we had to invest in our farms. Our two farms both have Global GAP certifications. When we launched our export business, we had quite a hard time convincing buyers that we can supply premium quality. Some buyers were hesitant to try product from China. We send lab reports together with each shipment. Now we are an accepted by buyer. The UK is one of our biggest markets in Europe”.
Luscious Fresh has a sister company in Australia under the name Royal Fresh International. Royal Fresh International supplies the Chinese market with Australian products. David is considering whether there are any mergers possible on the European market: “we export our products from China to Europe, Canada and Australia. This part of the business is handled by Luscious Fresh. We also import from Australia, South Africa, South America and Canada. Since we opened our company Royal Fresh in Australia we started to import more Australian fruit. There are four fruit varieties that are very sought after on the Chinese market: Tasmanian cherries, R2E2 mangoes, Honey Murcott mandarines and Crimson table grapes.”
“The Australian R2E2 mango is a very popular mango variety China. These mangoes have a beautifully blushed appearance. They look amazing. No other country can compete with Australia's mango's. The European market is pretty strong at the moment and there is good demand for fresh products. We constantly try to improve our products. At the moment I am thinking whether we could supply more Australian fruits to the European market. This could be interesting because Australia produces high quality goods. The large distance is the main problem. Last year at the Fruit Logistica trade fair in Berlin there were only two Australian companies present, and we were one of them”.
“In China we have three types of business: we sell to wholesale markets, we supply importers at wholesale markets and we sell directly to the end customer via our online shop. The Chinese fresh produce market is not focussed around supermarkets. Supermarkets do not dominate the market as in some other countries. They distribute a relatively small percentage of all imported fruit. Two years ago we opened up our E-commerce business with an online shop. This enables us to reach consumers directly. We have our distribution centre in Guangzhou, where we employ 75 packers.”
When asked whether there could be an opportunity to export fresh products from Europe to China, David reflects: “we have experience importing Greek kiwi's and French apples from Europe to China. I believe that there is definitely large opportunity for Europe to supply the Chinese market. At the moment, however, I think that European packers and exporters do not understand China. They believe that if the quality is sufficient to satisfy European consumers, the product can be exported. This is not the case. Imported fruits are a premium product in China. Consumers are ready to pay more for quality and food safety. The kiwis and apples we imported were not good enough to satisfy our Chinese clients.”
