Alpine Fresh notes Peruvian asparagus challenges
It should be an interesting year for Peruvian asparagus imports into the United States as there are several challenges affecting volume that will alter the deal depending on how they play out. At least that was the view of Walter Yager, CEO of Alpine Fresh Inc., a company he co-founded almost 35 years ago.
“Overall, there is less acreage — that should mean less products, but it might not impact the fresh market,” he said.
Yager reasoned that the price growers are receiving for processed asparagus spears, including from the frozen market, are down considerably this season. That could cause a higher percentage of the production to go to the fresh market and keep fresh volume at an even keel.
The longtime asparagus importer noted that the Peruvian asparagus deal goes through cycles and currently some other crops look more attractive to growers. As an asparagus field nears the end of its productive life cycle, growers need to weigh the economics of growing the crop against the forecasted return. “Right now, we’re seeing some farms tearing out fields and planting them with other crops,” he said, noting that the economics might be different when other fields term out in ensuing years.
Currently, virtually all inputs have seen a tremendous increase in cost while at the same time Mexico is increasing its asparagus production.
There is also a big increase in getting that product to the United States. “The cost of ocean containers is up 30 percent, while the cost of air freight is prohibitive,” he said. “Ten years ago, 10 percent of the volume was shipped by ocean and 90 percent by air. This year, I expect 80 percent by ocean and 20 percent by air.”
Alpine Fresh is expecting its own significant volume from Peru to be up slightly during this heavy fall and winter shipping period. “We expect promotable volume to be available Oct. 5,” he said, noting that the temperatures are getting a bit warmer every day.
Speaking in early September, Yager said a carton of Peruvian asparagus had an FOB price of the low to mid-$20s. “It’s promotable right now, but we believe that in early October there can be aggressive promotions, which we define as a sub-$20 market.”
Toward the future, the veteran asparagus importer said Peru could get a big boost to its asparagus industry once the United States eliminates the fumigation protocol. Currently there are on-going talks with indications that a decision will come by the end of this calendar year. That will be after the bulk of this season’s volume has been shipped, but Peru does send fresh asparagus to the U.S. market 12 months of the year.
Yager said the elimination of fumigation will allow Peruvian growers and U.S. importers to present a better quality spear to the U.S. consumer. Asparagus fumigation occurs most typically at the port of entry in the United States and requires handling protocols that are not optimum.
Yager said it also prevents the creating of value-added packaging at the point of origin, which would both increase the quality of the product and decrease the cost structure. It will also open the U.S. market to organic asparagus grown in Peru. Currently organic production from that country has to go to market in Europe or Canada.
He said the key to the discussions with the USDA is that the fumigation be eliminated and not be replaced with severe restrictions that will also harm the quality of the product.
Alpine Fresh Inc. was founded in January of 1988 by Yager and his longtime friend Jose Sanchez. According to the company, “Their vision was to bridge the gap between the growers of fresh fruits and vegetables in Latin America and the consumers in the United States.” The company has grown from two people, one pallet jack and a 250-square-foot office to a 50,000-square-foot corporate headquarters in Miami, with more than 4,000 employees worldwide. Alpine has operations in six different countries and sales on five different continents.