US fresh blueberries was one of several US agricultural products that received new or expanded access under the US-China Economic and Trade Agreement, signed on 15 January 2020.
This USDA report - Gain briefly describes market conditions, regulation of access and entry into the Chinese market, and recommendations for exporters of blueberries from the United States. Since consumers in China have recently become more familiar with blueberries, exporters must take note of consumer expectations regarding size, colour, and brix content. Smaller packages of around 125g are considered the most convenient to purchase, and of an appropriate size, for Chinese consumers.
Summary
PRODUCT DESCRIPTION AND MARKET ACCESS
blueberries is not a traditionally consumed fruit in China, however a higher standard of living and greater awareness of the health benefits of fruit consumption have led more consumers to seek out new fruits, such as blueberries.
Consumers tend to consume blueberries fresh, however they are also consumed in dry snack foods, as a mixture of other dry fruits and tree nuts, or as a stand-alone snack product. blueberries are increasingly being processed into purees and other concentrates for use in processed dairy products, drinks and yoghurt.
Chile and Peru are the largest exporters of fresh blueberries to China. Fresh blueberries for direct consumption are grown according to their brix level (sugar content) and skin composition. Chinese consumers tend to prefer larger blueberries with relatively higher brix levels, good appearance, firm texture and longer shelf life.
According to a 21 May 2020 announcement by the US Department of Agriculture, the Animal Plant Health Inspection Service (APHIS), APHIS and China's General Administration of Customs (GACC) signed a May 2020 work plan outlining steps US producers must take to export blueberries to China. Fresh blueberries from Florida, Georgia, Indiana, Louisiana, Michigan, Mississippi, New Jersey and North Carolina may be exported to China after special handling. In addition, blueberries from California, Washington and Oregon can be exported to China "with a systemic approach".
INTERNAL MARKET OVERVIEW
More than 70 per cent of the blueberries produced in China are consumed fresh. Until 2011, blueberries was traditionally supplied to high-end markets due to lower domestic production and limited imports. As consumer awareness has increased and domestic production has grown, prices have become more affordable for the middle class. June and July are the peak harvest season for domestic blueberries . Retail prices of domestic blueberries were around $4.00 per kg in June and July 2019 and reached a low of $2.00 per kg in late July 2019.
In 2012, China opened its market to blueberries imported from several countries, including Chile, Mexico, Uruguay, Canada and Peru.
Chile and Peru account for over 99% of the import market due to free trade agreements and opposing harvest seasons. blueberries from these two countries are not assessed tariffs against the 30% most favoured nation (MFN) rate. All other exporters pay the MFN import tariff rate. The peak season for import sales is January and February, because these months are off-season for domestic production and there is strong demand for fresh fruit during China's Spring Festival holiday period.
COMPETITORS FROM BLUEBERRIES USA
Chile and Peru are the main exporters of blueberries to China. Because South American producers have a different harvest season for fresh blueberries , Chinese domestic blueberries are in direct competition with US blueberries mainly because they have similar harvest seasons. In September and October, the domestic blueberries are approaching the end of their season and the quality drops significantly, while the quality of South American blueberries is also low. Also blueberries are now being exported from British Colombia to Canada, but production is low and cannot meet market demand. The future market is moving towards higher quality imported blueberries , with a stable supply and a sweet taste.
IMPORT OF BLUEBERRIES INTO CHINA BY ORIGIN (TONNES)
| Country | 2015 | 2016 | 2017 | 2018 | 2019 |
| Peru | 0 | 1 | 4.998 | 5.657 | 11.919 |
| Chile | 6.081 | 7.472 | 6.288 | 9.657 | 10.049 |
| Canada | 3 | 67 | 155 | 55 | 70 |
| Argentina | 0 | 0 | 0 | 2 | 6 |
| Total | 6.459 | 8.739 | 12.217 | 15.372 | 22.045 |
The growing consumption of blueberries is leading to an expansion of Chinese production from 14,000 tonnes in 2012 to 180,000 tonnes in 2018. Shandong, Guizhou and Liaoning provinces are the main production areas. Industry experts predict that domestic production could exceed one million tonnes by 2026, overtaking North America as the world's leading producer.
Large fruit producers, including Driscoll's, Costa, Hortifruit and SA Berry Fruit have made significant investments in China to grow blueberries and other berry fruits. Domestic producers have started to invest in different varieties that offer a better aroma and balance of sweet and sour flavours.
PRODUCTION OF BLUEBERRIES IN CHINA (THOUSANDS OF TONNES)
REGULATION
Producers are required to comply with the GACC's phytosanitary import requirements. According to the GACC's May 13, 2020, announcement number 64, blueberries must come from USDA APHIS-approved, registered packers or exporters. All shipments must be accompanied by a phytosanitary certificate issued by USDA APHIS. Fresh blueberries from California, Florida, Georgia, Indiana, Louisiana, Michigan, Mississippi, New Jersey, North Carolina, Oregon, and Washington may be exported to China.
All exports, except those from California, Oregon and Washington, must be fumigated before being exported to China. Specific import regulations are subject to change. Exporters are encouraged to check with their Chinese importer and USDA APHIS by reviewing their Phytosanitary Export Database (PExD) to confirm the most current import-export regulations.
DISTRIBUTION CHANNELS
Guangzhou and Shanghai are the predominant destinations for fresh fruit imports, as they have the most efficient customs procedures, are located on popular shipping routes and have well-established domestic transport networks.
Imports of fresh fruit have traditionally been handled by regional importers and distributors, but large retail chains with advanced logistics and transport efficiency increasingly seek to source directly from exporters and importers to eliminate distribution networks.
Retail outlets generally use free tastings, gift wrapping, colourful displays and nutritional information to promote fresh fruit sales.
FRUIT AND VEGETABLE DISTRIBUTION IN CHINA
Exporters of blueberries fresh should also pay attention to how e-commerce platforms are gaining market share and changing the traditional importer-distributor-retailer network. Since 2014, e-commerce platforms have started to focus on offering fresh groceries to consumers. E-commerce fresh produce sales grew by 42% to over $2.9 billion in 2018.
Major platforms, such as Tmall, JD and MissFresh enjoy advantages in terms of traffic and sales, but there are many other niche platforms, such as Benlai and Chunbo, that focus less on volume and more on brand recognition and a better customer experience.
E-commerce contacts reported that the industry has been reluctant to directly import fresh berries due to logistical and cost challenges, although some have placed orders shipped by air to fill the gap when the Chinese harvest season ends and South American blueberries have not yet arrived by sea transport.
Most platforms still choose to work with importers or distributors to ensure that products are fresh and reduce the risk of loss of these highly perishable products. Contacts also reported that blueberries, if not handled carefully in delivery, can lead to a very high rate of customer complaints, so they try to source only products with a firm consistency.
RECOMMENDATIONS FOR MARKET ENTRY
Attractive size, packaging and sweet flavoured varieties will help US products gain market share in China. To meet market demand, Chile and Peru have been able to provide blueberries in an appropriate size, setting the standard for consumer expectations.
It is expected that the US blueberries will be the most popular after June, when Chinese production will decrease and South American products will not yet have reached the market.
In China, blueberries are generally classified into three levels: 12 to 14 millimetres (mm), 14 to 16 mm and 16 mm or more. Products are typically sold in 125g packs. These smaller packs are convenient to purchase and appropriately sized for smaller Chinese households.
Exporters can also highlight the size and high sugar content on the packaging (and importers during sales discussions). Importers are required to look for US varieties that are greater than 12 degrees brix and larger than 16 mm.
