A customer picks a box of blueberries at a supermarket in Zhengzhou, Henan province.
Hipsters and health nuts the world over want more avocados for their toast and blueberries for their everything. Enter Chilean grower Hortifrut SA.
The Santiago-based company has ramped up deal-making and expansion plans to boost production and meet demand. Now, it's poised to close a deal announced in October to pay 0 million for Peru's Grupo Rocio, that country's largest blueberry producer.
Together with expansion plans in Mexico, the US and China, that move will more than double berry production, including blueberries, to greater than 100 million kilograms in the current harvest from the previous year, Victor Moller, the company's chairman, said in a phone interview. And there's more to come.
"People laugh at me because I still think that this company is in its infancy," Moller said of the 38-year-old company that went public in 2012. "But it's a baby with a huge growth potential."
That potential is partially due to the Chinese demand, which is creating abundant opportunities for the international blueberry growing industry.
From 2012 to 2016, China's blueberry imports had grown from 692 to 8,722 metric tons, with the trade volume growing from.6 million to.4 million, according to a report published at the 2017 International Blueberry Organization Summit in Qujing, Southwest China's Yunnan province.
Felipe Juillerat, president of the Chilean Blueberry Committee, said that some 70 percent of Chile's blueberry exports to Asia go to the Chinese market.
China's per capita consumption of blueberries is 3.7 grams per year, compared to 1.5 kilograms in the United States, which means the Chinese market is full of potential, he said.
In January and February of this year, the peak of the Chilean harvest, blueberries exported to a port in China were sold at an average of .04 per kilogram, according to data from agricultural consultant iQonsulting. On the US East Coast, the average price was .40 per kilogram.
With so much demand, Hortifrut is eyeing more acquisitions, Moller said.
"We're always trying to defend our leading position in the world," Moller said. "It's part of our business model, to grow in partnerships with leading companies either in production, distribution, genetic engineering, processing or logistics."
In 2016, Hortifrut signed a joint venture agreement with California's Munger Farms to combine assets in California, Oregon and Washington states. A year earlier, it signed a joint venture with China's Joyvio Wing Mao, of which Hortifrut owns 51 percent.
"We want to plant as much as we can as China will be a market as important as the US," Moller said. "Europe is just starting to consume blueberries; it has a lot more to grow."
China offers "phenomenal growth", said Mihai Ciobanu, chief executive officer of fresh4cast.com, at a conference last month.
"Chile is shifting more and more of its volumes toward China," Ciobanu said. "Prices paid in Asia are coming down a bit as the market matures, but there's still a gap above what North America pays."
Investors are happy so far, considering the Chilean grower Hortifrut is up more than 500 percent since the IPO, compared to a 29 percent increase for the benchmark IPSA Index in Chile in the same period. Revenue has more than doubled to 7 million since before the listing, though it slipped by 9 percent in 2017, according to data compiled by Bloomberg. The stock was unchanged at 1,970 pesos while the IPSA advanced 0.4 percent.
Blueberries have become something that consumers want 24/7, year-round, said Roland Fumasi, senior fruit and vegetables analyst at Rabobank in Fresno, California, in that state's agricultural powerhouse Central Valley.
Worldwide, some 1.7 million tons of blueberries were produced last year, two and a half times the amount in 2000, according to consultancy fresh4cast.com. That should reach 2 million tons in two years. The US is the biggest producer of blueberries, followed by Canada and Chile, which is the largest global exporter.
"When it comes to demand, it's really inelastic," Fumasi said. "People just have to have their blueberries."