Thai Pineapple Producers Squeezed as Costa Rica’s Find New Markets

Three of the major shipping companies have added to their refrigerated transportation capacity over the past three months in anticipation of increased global trade in tropical fruit, as discussed in Panjiva research of November 30. Aside from trade deals, such as the recently aborted Trans-Pacific Partnership, local governments and cooperatives are supporting bilateral deals. One recent example was signed for exports of pineapples from Peru to Spain, but this is likely only the start of the process.

One major target will be the U.S. market, which imported $1.12 billion of fresh, processed and juiced pineapple products in the 12 months to October 31. Panjiva data shows that imports of fresh produce, of which 86.2% come from Costa Rica, increased 14.3% in the three months to October 31 on a year earlier.

This outstripped imports of processed products, which fell 13.0% over the same period to their lowest since at least 2009 in October. This will have hurt producers in particular from Thailand and Indonesia as leading buyers including Del Monte and Dole shift purchases in response to consumer demand.

U.S. CONSUMERS PREFER FRESH TO PROCESSED PINEAPPLE

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Chart compares U.S. imports of fresh pineapples, segmented by country of origin, to processed pineapple products Source: Panjiva

U.S. imports of pineapple juice are more global and therefore more competitive, with Costa Rica supplying 30.7%, Thailand 29.7% and the Philippines 22.8%. Imports over the three months to October 31 increased 9.8%, with Costa Rican suppliers climbing 37.8%, again at the expense of Thai exporters whose volumes fell 1.2%.

THAI JUICE PRODUCERS LOSE OUT TO COSTA RICANS

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Lower panel shows change in total U.S. imports of pineapple juice aggregated over three months compared to the same period a year earlier Source: Panjiva

The loss of market share in the United States is driving exporters to try and expand in Asia. So far imports by Chinese buyers have been minimal, totalling just $124 million in the past 12 months. Yet, imports have jumped 106% in the 12 months to October 31 compared to 2013. This has been led by suppliers from Taiwan and the Philippines, with incumbent Thai producers missing out. Here the local buyers are led by Dole’s local subsidiary as well as other local food wholesalers.

CHINESE TASTE FOR PINEAPPLE GROWING, TAIWAN AND PHILIPPINES SUPPLYING

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Chart shows Chinese imports of pineapples, products and juices segmented by country of origin Source: Panjiva

Costa Rica, the world’s largest producer according to UN data, is a case in point of successful expansion over the longer term. Its global exports have increased just 2.1% in past 12 months vs. 2014, Panjiva data shows. Yet, this came despite a 2.2% contraction in all exports to the U.S. over that period, as it managed to increase exports to the European Union by 6.2% and to Asia by 60.9%.

COSTA RICA FINDS ALTERNATIVE HOMES FOR UNLOVED PRODUCE

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