"Business as usual" for Aussie cherry exports to China despite trade tension whispers

Cherry Growers Australia (CGA) president Tom Eastlake would normally be in China at this time of year, but travel restrictions due to COVID-19 have meant that he - like other industry representatives - cannot be in the market to explain why less fruit is arriving from Down Under.

The market is awash with cherries in the lead up to Chinese New Year on 12 February, and the focus of the Global Times article was on a sharp reduction in prices due to higher volume from the dominant supplier Chile, whose exports have risen by more than a third this season.

At around 360,000 tonnes, the South American country's exports alone are almost 15 times Australia's entire cherry production including the fruit that's sold here domestically. 

Australia's exports are but a drop in the ocean in comparison, but the major difference is they don't travel across the Pacific in containers.

"Chile is all sea freight whereas we're all air freight. We trade on our freshness proposition of 72 hours from tree to market," Eastlake tells Business News Australia. 

"Because we trade in an ultra-premium space, we can't ship fruit that doesn't uphold our premium reputation. In the past growers have elected not to ship if they had quality issues, or if weather problems had affected their orchards."

Because Australia's cherry exports have been rising over the years, Eastlake believes comments made by some Chinese importers to the Global Times were a well-intended attempt to explain the anomaly of 2020-21.

"Our exports to China are down about 7 per cent, but given the trading conditions with no international passenger flights and us being 100 per cent reliant on air freight, to be down 7 per cent is a remarkable achievement by both the Australian growers and the importers in China," says Eastlake.

"I think what's happened here, as best as I can ascertain speaking to our context, is that you've got some well-meaning people in the market trying to provide an explanation as to why the [Australian] cherries are down this year, because the Chilean crop is up.

"Exports are up overall but only marginally down in China," he clarifies.

Cherry supply is currently transitioning between the Australian mainland season and the ramping up of Tasmanian production, but Eastlake emphasises exporters continue to ship and the market is very strong.

"When we saw the story break earlier in the week we reached out to all our contacts -  government, private, importers, wholesalers - to see if there were any issues, and the only issue was 'we need more fruit, please send more fruit because we're down'.

"There's a bit of a lag in the window between the mainland and Tasmania, but we'll have good, full volumes again I expect very rapidly and continuing all the way through until Chinese New Year."

Fruit Growers Tasmania CEO Peter Cornish says there have been no indications from importers about problems with Australian cherries.

"The Tasmanian exporters are only in the early stages of it. We really don't get cracking until after Christmas or in the new year, and we will go through all the way through to February," says Cornish.

"It's still very much business as usual. There's very strong demand."

Cornish makes similar comments to Eastlake's about Australian growers finding their niche with premium product in light of the Chilean industry's massive size.

"We're fortunate here in Tasmania that because of our cooler climate the cherries stay on the trees for longer. That means they are bigger, redder and firmer and have a high sugar level, so it tastes very good," he says.

"They're much sought after - they really are a premium product. They occupy a tiny part of the market in China and other countries really, but they're significant for us of course. Some 60 per cent of the Tasmanian crop is exported."

"The quality of of our cherries this year, in fact, is tremendous. There are no issues that our exporters have seen."

Eastlake says if conditions change or issues arise, the Australian cherry industry's approach would always be to cooperate and discuss any concerns from their trading partner.

"We're very relational. I wouldn't describe us as trade-focused - we spent decades without trade protocols, and the way we got them is that we worked on relationship building," he says.

"We had people on the ground in China, growers helping Chinese growers to grow cherries, we had people working with the government to promote two-way trade, and that's what we've done."

While Eastlake could not visit his partners in China this season, he has remained in close contact and the industry takes the trade "extraordinarily seriously".

"We must maintain those relationships, not just from a trade point of view but because of our investment and their investment in us," he says.

"We've got a lot of Chinese investment in cherry production in Australia in packing and export, and we've dedicated time and intellectual property investment in China to help their industry improve, not just in importing and wholesaling, but also in production.

"We would like to see their cherries here, because they're counter-seasonal and imported cherries really do help us by keeping it as a consumer option year-round."

Business News Australia