Chilean Food Exports May Suffer From Quake - Discovery News

Chilean Food Exports May Suffer From Quake - Discovery News

By Lauren Effron | Tue Mar 2, 2010 07:22 PM ET

The horrible earthquake disaster in Chile may be half a world away, but the effects could reach all the way to your kitchen table.

Even though we're still in the middle of winter here in the United States, we've come to expect our grocery stores to be fully stocked with our favorite fruits, vegetables and other spring and summer produce year-round. And stocked they are. Trudge through snow and ice to your local grocery and you can still pick up bananas, oranges, blueberries -- even fresh cut flowers for your mother's birthday.


Trade agreements with foreign countries make it possible for you to have peaches in your yogurt and wine on your dinner table any day of the year. The free trade agreement the U.S. signed with Chile in 2004 is no exception, opening the doors for a flood of fresh produce from the southern hemisphere.

But what happens when a natural disaster strikes? Following this weekend's quake, those peaches -- and many other Chilean goods -- may become harder to find.

In the wake of the 8.8-magnitude earthquake that hit Chile on Feb. 27, 2010, the country's ability to export goods has been severely impacted. Key infrastructure, such as roads, bridges, harbors, processing/packaging plants and basic communication lines have been partially or fully destroyed.

According to the Californian and the American Chambers of Commerce, Chile is the United States' 25th largest export partner. For California alone, Chile is its 22th largest export partner, bringing in fresh fruits, forestry products, wines, and seafood to the Golden State.

Chile exported $1.3 billion (in U.S. dollars) worth of fresh fruits in 2003, with packaged food exports tallying at $1.5 billion in 2008, according to U.S. Department of Agriculture statistics. Out of all the fruit coming from Chile to the U.S., 65 percent of Chilean fruit crops come through Philadelphia to serve stores east of the Mississippi River, according to a recent article in the Philadelphia Inquirer. The remainder enters through Los Angeles. About 50 percent of all fruit in the U.S. is Chilean.

The entire southern hemisphere is in the peak of its harvest season for these crops, so this quake's aftermath will truly be felt on produce stands from coast to coast. Going by the numbers, let's break down five of some of these top food exports from Chile to the U.S.:
Chile-grapes Chile-wine Grapes

Chile is the primary worldwide exporter of grapes, with control over 24 percent of the global grape market, according to the Produce Marketing Association's 2003 records.

The USDA reports that raisins are the most popular dried fruit in America. They accounting for about two-thirds of total dried fruit consumption. Generally raisins are produced domestically, but the U.S. also imported 42.5 million pounds of raisins in 2008, primarily from Chile. Chile has been the leading supplier of raisins to the U.S. since 2000.

Wine is also another major commodity in Chile, and early reports are not looking good. According to WineSpectator.com, many wineries are reporting "broken tanks and millions of liters of wine lost." According to a Nov. 2009 USDA report, Chile is fourth in the world for wine exports.


By 2008, Chile had fought its way to become the world's largest plum supplier. Over 36 plum varieties are planted in Chile, and the U.S. is the main export market for fresh plums followed by EU member countries and China (Hong Kong).
Kiwis

Also crowned the second-biggest kiwifruit exporter in 2008, Chile was able to gain this title after kiwi exports to the U.S. increased after the 2004 free trade deal, according to a 2008 Congressional Research Service report.
Chile-peaches Peaches

In 2003, 9 percent of the world's peaches were produced in Chile, with a heavy hand in exporting canned peaches. By 2008, over 60 percent of Chile’s total peach and nectarine exports were bound for the United States, USDA reports show.


Chile has a successful seafood industry with farmed salmon ranking second in the world for salmon exports, according to a 2009 USDA report. Chilean salmon exports to the U.S. skyrocketed from 1.2 million pounds in 1989 to 50 million pounds in 1996 -- enough for salmon farming industries in Maine and Washington State to feel the pinch and call for legislation to curb the glut of the tasty fish.

While it's still too early to tell how badly the earthquake and tsunami aftermath will affect these crops, Chilean officials are hopeful. The chairman of ASOEX, the Santiago-based Chilean Exporters Association, Ronald Brown said "initial reports [of fruit crop and packing facility damage] are encouraging" in a press release on Mar. 1, 2010.

"Because Chile has moved to the peak of the harvest season, a substantial volume of fruit is on the water headed for international ports," Brown said in the release, "We do not anticipate major disruption in fruit supplies."

So for the next few days, grocery stores across the U.S. should see normal produce supplies. After that, only time will tell. It's possible for prices to rise, and even for some of these items to disappear from our fruit bowls and dinner plates for a while. Bottom line -- it depends on how fast the people of Chile can get back on their feet.