Global Green Cherry

World Sweet Cherry Review – Key Points from the 2011 Edition Published July 2012

Global Green Cherry 7/19/2012

World Sweet Cherry Review – Key Points from the 2011 Edition.

… “In contrast, emerging markets such as India, Indonesia and Brazil have been experiencing

rapid growth in both populations and productivity, while China and Russia have been

enjoying dramatic gains in productivity. (…) Suppliers at a location disadvantage will have to

make major adjustments to hold market share”

“The area of sweet cherries planted and harvested each year in the world continues to climb.

The chart below shows the data for area harvested reported by UN, FAO. Even though the area

harvested in any year can be affected by adverse weather, the upward trend remains clear. (…)

However, in the six years since 2003, world area harvested of sweet cherries has risen by

about 44,000 hectares, an annual rate of increase of about 2 percent. This is a much faster

rate of increase than that recorded in the last period of steady growth between 1994 and 2001.

The additions to world sweet cherry area show little signs of slowing”

… “On present trends, the world area harvested of sweet cherries should soon top 400,000

hectares for the first time”

… “For a number of years in the last decade, UN, FAO estimates of world sweet cherry Production flirted with, but never topped, 2 million metric tons. However, in 2009, production

soared above that mark to an estimated 2.2 million metric tons. UN, FAO data included

relatively low estimates for sweet cherry production in China. Since 2003, USDA, FAS has been

reporting much higher estimates of production in China. When the USDA estimates are

included, they suggest that world sweet cherry production has consistently averaged above 2

million metric tons since 2007, and may have reached 2.3 million metric tons in 2009.”

“Both total tropical fruits and total berries saw production grow by more than one third in the

decade. There was also rapid growth in kiwifruit, miscellaneous deciduous fruits, such as

persimmons, and miscellaneous citrus and tropical fruits.

Clearly, the competition for sweet cherries from other fruits has become even more intense

over the last decade. This means that consumers have an ever-widening array of fruits

choices. If sweet cherries are to continue to win the favor of consumers, they must

consistently meet the highest standards for quality, consistency, reliability and value for money.

World sweet cherry production in 2015 at average expected yields is forecast to be 2,864,800

metric tons, 34.5 percent above the average for 2007 to 2009.

Trade in fresh sweet cherries continues to expand over time. The expansion has been fitful

due to changes in world supplies from year to year. However, the long term trend is clear.

Exports rose from 95,248 metric tons in the three-year period, 1990-92, to 145,775 metric tons

in 2000-02 and 250,941 metric tons in 2006-08, the latest three-year period for which

comparable data is available. On average, since 1990-92, exports have grown by about 10

percent per year, a much faster rate than the growth of world production.

The 24 countries for which data are available include most of the world's largest sweet cherry

producing countries, provide over 90 percent of world production and utilize over 90 percent of

world supplies. However, even when including China, these countries account for less than 40

percent of world population.

If these countries produce 90 percent of the world’s supplies and consume also 90 percent of

the world supplies and they represent 40 percent of the world’s population, it is easy to infer

that the consumption of cherries is bound to outgrow production as cherries go wining the

favor of consumers.

… “(…) per capita consumption of fresh sweet cherries has been increasing in populous

producing countries like the United States, the Russian Federation, China and Turkey. The

challenge here is to maintain the growth momentum. Trends are also favorable in a number

of non-producing countries in Southeast Asia that are already growing markets for other

fresh temperate fruits. There is an opportunity to leverage increased sales of sweet cherries

from success with products like apples and pears”.

Finally, there are a large number of countries where fresh sweet cherries are little known and

little appreciated. In these countries, a growing middle class and the expansion of modern

retailing offer increasing potential for a premium product like sweet cherries. One challenge

(…) is to ensure that supplies grow in step with the expanding demand (…). Overall, there

continue to be varied (…) opportunities for increasing world per capita consumption of fresh

sweet cherries”.

… “(…) Prices ranged from $2.348 per lb in July 2009 to $3.828 in June 2011. (…) On average, a 10 percent change in volume was associated with a 2.5 percent change in retail price. This indicates that the demand for sweet cherries at the retail level is still elastic. When volume increases, the value at retail also increases”.

Uprising Trends in Market prices …“The trend in retail prices has been steadily upward, increasing by about one euro per kilogram every four years”

… “The coming expansion of world sweet cherry production and trade is likely to bring

downward pressure on prices in large crop years”

.. “The growth in production over a decade is an indicator of the level of confidence producers

and investors had in the future of the sweet cherry industry and its ability to generate

sufficient payoff to warrant continued investment. A few countries stood out on this criterion,

Turkey, the United States, the Ukraine, Uzbekistan, Syria, Chile and China”

THE RED HOT REPORT – WHY TART CHERRIES ARE ON TREND.

… “Tart cherries are hot and their unique flavor, nutrition and

naturally functional properties are right on target with

consumers’ new food and beverage demands.”

… “As consumers continue to look to their diet as a means of

health, Super Fruits, which deliver nutrients and health benefits

naturally, are key to maintaining good health. Tart cherries are a

naturally functional powerhouse, rich in antioxidants and

anthocyanins.”

… “Tart cherries also deliver “new nutrients” that cutting-edge consumers increasingly crave,

including potassium, magnesium and beta carotene.”

… “Tart cherry ingredients can deliver natural technical advantages for some of today’s

toughest product development challenges, such as clean ingredient labels, extending the shelf

life of food, keeping baked goods moist/mold free, reducing fat, sodium, etc. and the safe

elimination of some food additives.”

… “Naturally functional (…) is now preferred to traditional fortification or dietary

supplements as a source for nutrients. For the past 20 years, nine in 10 adults have believed it

is very important to get their nutrients from foods that are naturally rich in vitamins/minerals,

67% from supplements and 53% from fortified foods.”

… “Since 2008, natural/unprocessed foods and super foods/antioxidants have ranked right behind whole grains/high fiber and low-in claims, (e.g., calories, sodium) the most important product attributes for maintaining good health.” … “Adding pulp and fruit pieces to juices and other foods (e.g., yogurt) is another hot new trend.4 Right after vegetables, fruit is the most important component for healthy eating.” … “ Healthy Foods Fast Facts:

60% of families practice some form of healthy eating strategy.

Healthy foods grew 5% last year, despite the recessionary period.

A new low income segment - expected to bring in $115 billion in incremental new CPG sales in the next 10 years - are other fast growing healthy food segments.

Food/drinks carrying an antioxidant topped $1.9 billion in sales in 2009, up 29% over the previous year.10 Half (53%) of consumers bought a specific food or beverage for its antioxidant content; 6 in 10 stay loyal to the product due to antioxidants.

Antioxidants were the #1 most sought after ingredient in functional beverages in 2010 by 51% of consumers.

Antioxidants show no sign of slowing down and are currently an enormous mass market opportunity, similar to calcium. Nine (93%) of 10 adults are aware of antioxidants. One-third (31%) are making a strong effort to consume more.”

… “Half (51%) of consumers are making a strong effort to get more vitamin C, 39% fiber, 36% B-vitamins, 31% vitamin E and 28% vitamin A - all of which tart cherries can help deliver naturally.”

… “Tart cherries can naturally deliver potassium and magnesium – among the “hot” new nutrients consumers are looking to for healthy hearts.”

“Tart cherries, with its beta carotene content 19 times the level of blueberries or strawberries, can help make the illusive eye health market a reality for food marketers”.

“Cherry was the 4th most used fruit flavor in new foods/beverages globally in 2010; 5th in the U.S.4 Moreover, the use of cherry flavors”

CHINA HAS BIG APPETITE FOR U.S. CHERRIES (Good Fruit Grower – News).

“Asian markets traditionally have been major importers of U.S. cherries, but a new player in the Far East—with a big appetite—has altered the export priorities of Pacific Northwest cherry growers.” “In just a few years, Northwest cherry exports directly to China have grown by nearly 480 percent—from 73,800 boxes (20-pound equivalent) in 2007 to 427,900 last year. No foreign country has posted more impressive cherry export growth than the People’s Republic of China, and that number doesn’t reflect shipments sent to Hong Kong that make their way to the mainland.”

CHERRIES IN CHINA (Good Fruit Grower – News).

“Cherries are an iconic fruit in China and are the most sought-after fruit product

to be offered as gifts during China’s various holidays. Cherries will continue to be

grown in China, and the people there will continue to see them as an affordable

luxury that symbolizes something special in their day-to-day lives”.

FRUIT AND TREE NUTS OUTLOOK (USDA – July 29, 2011).

“Cherry exports are up slightly in 2011 through May relative to the same period last year. Shipments to Canada are at 10 million pounds, a 7-percent increase from 2010, making it the current top export market for U.S. cherries. Excellent quality and a weak U.S. dollar have motivated higher export volumes this year. As the larger crop continues to move from field to market, exports can be expected to Increase”.

B.C. CHERRIES GETTING READY TO FLY TO CHINA (Newsroom – BC Government Online News Source).

Quick Facts:

B.C. exported about $29-million worth of cherries in 2010, with over $7.5 million to Taiwan and $5 million to Hong Kong.

The top export markets for B.C. sweet cherries are the United States, Taiwan, Hong Kong, the United Kingdom and the Netherlands.

B.C. cherry growers employ over 3,000 people during the harvest season.