Required Report - public distribution

**Date:** 10/11/2006

**GAIN Report Number:** CI6030

CI6030

**Chile**

**Dried Fruit**

**Annual**

**2006**

**Approved by:**

![](media/image1.wmf)Joseph Lopez, Agricultural Attaché

Office of Agricultural Affairs

**Prepared by:**

Luis Hennicke, Agricultural Specialist

**Report Highlights:**

**Chile's raisin production and exports are expected to increase due to
a larger availability of discarded table grapes, prunes will also expand
as a result of expanding planted area and a strong export demand.**

Includes PSD Changes: Yes

Includes Trade Matrix: Yes

Unscheduled Report

Santiago \[CI1\]

\[CI\]

Table of Contents

[Executive Summary 3](#executive-summary)

[RAISINS 3](#raisins)

[Production 3](#production)

[Consumption 3](#consumption)

[Trade 3](#trade)

[Stocks 4](#stocks)

[Policy 4](#policy)

[Prices 4](#prices)

[PSD Table 4](#psd-table)

[Export Trade Matrix 5](#export-trade-matrix)

[PRUNES 6](#prunes)

[Production 6](#production-1)

[Area Planted 6](#area-planted)

[Consumption 6](#consumption-1)

[Trade 6](#trade-1)

[Stocks 6](#stocks-1)

[Prices 7](#prices-1)

[PSD Table 7](#psd-table-1)

[Export Trade Matrix 8](#export-trade-matrix-1)

# Executive Summary

For MY2005 (Jan-Dec 2006), raisin production and exports are expected to
rise when compared to the previous year, as the availability of
discarded table grapes increases. A similar scenario is expected for
prunes. The MY2005 (Jan-Dec 2006) crop is expected to be larger than
last year's output, as production area keeps expanding. For MY2006
(Jan-Dec 2007), another increase in production of raisins and prunes is
expected, as more of the recently planted vines become productive.

# RAISINS

# Production

Raisin production in MY2004 (Jan-Dec 2005) resulted much larger than
both, last year's production and our previous estimates. Increased
production of table grapes together with less demand for these grapes by
the wine industry, allowed producers to dry larger amounts of discarded
table grapes, increasing raisin production. Raisin production in Chile
is based on lower quality table grapes and those rejected from the table
grape export process. The wine and concentrated juice industries are the
main competitors for table grape leftovers.

As table grape production keeps increasing in Chile, raisin production
is also expected to expand. As a result another small production
expansion of raisins is estimated for MY2005 (Jan-Dec 2006). But because
weather can play an important role in table grape quantity and quality,
it is still too early to accurately forecast MY2006 (Jan-Dec 2007)
raisin production. However a slight increase is expected in next year's
crop, as higher than normal temperatures during this winter's months
(July -- August 2005) would probably only affect table grape output
slightly and no expansion in total grape production would be expected in
spite of new plantings coming into production.

In the coming years raisin output is expected to face less competition
from the wine industry as more vineyards with wine varietals come into
production. However, a fast growing grape juice industry is expected to
increase competition for the discarded table grapes that go into raisin
production.

# Consumption

Chile\'s best quality raisins are exported. As with most of Chile's
fruits, the domestic market normally receives raisins rejected for
export. Because domestic raisin consumption is small, it does not
influence production or trade decisions. The main end‑users of raisins
are the baking, pastry and ice cream industries. Raisins are primarily
used in finished products such as cakes, cookies, and ice cream.
Non‑industrial usage and snack consumption are both very limited.

## 

# Trade

Over 90 percent of Chilean raisin production is exported. The Latin
American market accounts for half of Chile\'s raisin exports and it is
generally the destination for the lower quality raisins. For MY2005
(Jan-Dec 2006), exports are expected to increase due to the greater
availability of raisins and strong export demand.

# Stocks

Most raisin exporters have a policy of maintaining stock levels close to
zero. Whenever possible, exporters prefer to sell or export all of their
production. Variations in the ending stock level from one marketing year
to the next, generally only means that the raisins have not yet been
shipped to their destination.

# Policy

The government does not provide direct export subsidies or play any role
in setting quality standards for this product.

# Prices

Raisins currently are not a key consumer item in Chile. Consequently,
neither the government nor the various exporter associations maintain
retail or wholesale prices. Export prices for CY2005 averaged
US\$1,540/MT, up from CY 2004 average price of US\$1,286/MT.

<table>
<colgroup>
<col style="width: 21%" />
<col style="width: 8%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 6%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 8%" />
<col style="width: 9%" />
<col style="width: 9%" />
</colgroup>
<tbody>
<tr class="odd">
<td colspan="10"><h2 id="psd-table">PSD Table</h2></td>
</tr>
<tr class="even">
<td>Country</td>
<td colspan="9">Chile</td>
</tr>
<tr class="odd">
<td>Commodity</td>
<td colspan="6">Raisins</td>
<td colspan="3">(HA)(MT)</td>
</tr>
<tr class="even">
<td></td>
<td>2004</td>
<td>Revised</td>
<td></td>
<td>2005</td>
<td>Estimate</td>
<td></td>
<td>2006</td>
<td>Forecast</td>
<td></td>
</tr>
<tr class="odd">
<td></td>
<td>USDA<br />
Official</td>
<td>Post<br />
Estimate</td>
<td>Post<br />
Estimate<br />
New</td>
<td>USDA<br />
Official</td>
<td>Post<br />
Estimate</td>
<td>Post<br />
Estimate<br />
New</td>
<td>USDA<br />
Official</td>
<td>Post<br />
Estimate</td>
<td>Post<br />
Estimate<br />
New</td>
</tr>
<tr class="even">
<td>Market Year Begin</td>
<td></td>
<td>01/2005</td>
<td>01/2005</td>
<td></td>
<td>01/2006</td>
<td>01/2006</td>
<td></td>
<td>01/2007</td>
<td>01/2007</td>
</tr>
<tr class="odd">
<td>Area Planted</td>
<td>47720</td>
<td>47720</td>
<td>47720</td>
<td>47720</td>
<td>47720</td>
<td>47727</td>
<td>0</td>
<td>0</td>
<td>47750</td>
</tr>
<tr class="even">
<td>Area Harvested</td>
<td>42000</td>
<td>42000</td>
<td>42000</td>
<td>42200</td>
<td>42200</td>
<td>42400</td>
<td>0</td>
<td>0</td>
<td>42600</td>
</tr>
<tr class="odd">
<td>Beginning Stocks</td>
<td>768</td>
<td>768</td>
<td>768</td>
<td>468</td>
<td>468</td>
<td>1016</td>
<td>468</td>
<td>468</td>
<td>1016</td>
</tr>
<tr class="even">
<td>Production</td>
<td>48900</td>
<td>48900</td>
<td>55900</td>
<td>49200</td>
<td>49200</td>
<td>56000</td>
<td>0</td>
<td>0</td>
<td>56500</td>
</tr>
<tr class="odd">
<td>Imports</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
</tr>
<tr class="even">
<td>Total Supply</td>
<td>49668</td>
<td>49668</td>
<td>56668</td>
<td>49668</td>
<td>49668</td>
<td>57016</td>
<td>468</td>
<td>468</td>
<td>57516</td>
</tr>
<tr class="odd">
<td>Exports</td>
<td>46100</td>
<td>46100</td>
<td>52552</td>
<td>46100</td>
<td>46100</td>
<td>52800</td>
<td>0</td>
<td>0</td>
<td>53500</td>
</tr>
<tr class="even">
<td>Domestic Consumption</td>
<td>3100</td>
<td>3100</td>
<td>3100</td>
<td>3100</td>
<td>3100</td>
<td>3200</td>
<td>0</td>
<td>0</td>
<td>3400</td>
</tr>
<tr class="odd">
<td>Ending Stocks</td>
<td>468</td>
<td>468</td>
<td>1016</td>
<td>468</td>
<td>468</td>
<td>1016</td>
<td>0</td>
<td>0</td>
<td>616</td>
</tr>
<tr class="even">
<td>Total Distribution</td>
<td>49668</td>
<td>49668</td>
<td>56668</td>
<td>49668</td>
<td>49668</td>
<td>57016</td>
<td>0</td>
<td>0</td>
<td>57516</td>
</tr>
</tbody>
</table>

+--------------------+-------------+--------------------+-------------+
| ## E               |             |                    |             |
| xport Trade Matrix |             |                    |             |
+--------------------+-------------+--------------------+-------------+
| Country            | Chile       |                    |             |
+--------------------+-------------+--------------------+-------------+
| Commodity          | Raisins     |                    |             |
+--------------------+-------------+--------------------+-------------+
| Time Period        | Jan-Dec     | Units:             | M.T.        |
+--------------------+-------------+--------------------+-------------+
| Exports for:       | 2005        |                    | 2006        |
+--------------------+-------------+--------------------+-------------+
| U.S.               | 12626       | U.S.               | 8272        |
+--------------------+-------------+--------------------+-------------+
| Others             |             | Others             |             |
+--------------------+-------------+--------------------+-------------+
| Mexico             | 7049        | Mexico             | 4927        |
+--------------------+-------------+--------------------+-------------+
| Peru               | 5221        | Colombia           | 2717        |
+--------------------+-------------+--------------------+-------------+
| Colombia           | 4453        | U.K.               | 2658        |
+--------------------+-------------+--------------------+-------------+
| U.K.               | 3992        | Brazil             | 1948        |
+--------------------+-------------+--------------------+-------------+
| Venezuela          | 3558        | Peru               | 1744        |
+--------------------+-------------+--------------------+-------------+
| Netherlands        | 2903        | Netherlands        | 1279        |
+--------------------+-------------+--------------------+-------------+
| Ecuador            | 1758        | Russia             | 896         |
+--------------------+-------------+--------------------+-------------+
| France             | 1595        | Ecuador            | 762         |
+--------------------+-------------+--------------------+-------------+
| Russia             | 1426        | France             | 672         |
+--------------------+-------------+--------------------+-------------+
| Japan              | 1113        | Poland             | 667         |
+--------------------+-------------+--------------------+-------------+
| Total for Others   | 33068       |                    | 18270       |
+--------------------+-------------+--------------------+-------------+
| Others not Listed  | 6858        |                    | 5618        |
+--------------------+-------------+--------------------+-------------+
| Grand Total        | 52552       |                    | 32160       |
+--------------------+-------------+--------------------+-------------+
|                    |             |                    |             |
+--------------------+-------------+--------------------+-------------+
| Note: Year 2006    |             |                    |             |
| data are for       |             |                    |             |
| January through    |             |                    |             |
| August only        |             |                    |             |
+--------------------+-------------+--------------------+-------------+

# PRUNES

# Production

Total prune production expanded slightly in MY2004 (Jan-Dec 2005). Good
weather and new-planted area coming into production explain most of the
output expansion. Additionally, as a result of strong export demand and
excellent export prices for prunes, producers invested in improved
orchard management practices (pruning and fertilizing), which also
resulted in an increase in production.

For next year's output, MY2005 (Jan-Dec 2006), industry sources indicate
that plum production destined for prune production is expected to expand
as planted area keeps expanding and a significant area is going into
production.

Chile harvests plums from mid‑February through mid‑April, entirely by
hand. According to industry this greatly enhances the fruit quality, as
it is picked at peak ripeness and maturity. Prunes are mainly sun‑dried,
although there are also some drying tunnels.

# Area Planted

Industry sources report that producers are increasing planted area
significantly; mainly as a result of good prices they've received for
plums during the last few years and a lack of better economic
alternatives for many growers. This additional planted area is starting
to bear fruit and is expected to increase total production over the next
few years. These same sources have indicated that total production
should level off in about 4 to 5 years at around 80 to 100 thousand
metric tons a year.

Plum trees for prune production are planted from Regions V (San Felipe)
through Region VII (Talca). The largest planted area is located in the
Metropolitan Region and Region VI, where roughly 90 percent of all plum
trees are found.

# Consumption

As with most of Chile's fruits, the domestic prune market is a residual
market, normally taking less than 10 percent of domestic production.
Domestic demand is principally for lower‑priced prunes. These are either
consumed directly or are processed into foods like juice or ingredients
for the bakery industry or yogurt.

# Trade

The EU is Chile's largest prune export market, receiving over 30 percent
of total exports, followed by Mexico with almost 23 percent.

There are over 45 firms operating in Chile's prune export business.
However, three exporters account for nearly 70 percent of total export
volume. One firm, Prunesco, accounts for a little over 40 percent of
Chile\'s exports.

# 

# 

# Stocks

The prune industry, like the raisin industry, maintains stock levels as
low as possible.

# Prices

Chile maintains no official retail or wholesale price series for prunes.
Farm price information is even scarcer than for raisins. The average
international price received for Chilean prunes rose from US\$1,584 per
MT (FOB) in CY2004 to US\$2,355/MT in CY2005.

<table>
<colgroup>
<col style="width: 21%" />
<col style="width: 8%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 8%" />
<col style="width: 9%" />
<col style="width: 8%" />
<col style="width: 8%" />
<col style="width: 8%" />
</colgroup>
<tbody>
<tr class="odd">
<td colspan="10"><h2 id="psd-table-1">PSD Table</h2></td>
</tr>
<tr class="even">
<td>Country</td>
<td colspan="9">Chile</td>
</tr>
<tr class="odd">
<td>Commodity</td>
<td colspan="6">Prunes (Plums, Dried)</td>
<td colspan="3">(HA)(1000 TREES)(MT)</td>
</tr>
<tr class="even">
<td></td>
<td>2004</td>
<td>Revised</td>
<td></td>
<td>2005</td>
<td>Estimate</td>
<td></td>
<td>2006</td>
<td>Forecast</td>
<td></td>
</tr>
<tr class="odd">
<td></td>
<td>USDA<br />
Official</td>
<td>Post<br />
Estimate</td>
<td>Post<br />
Estimate<br />
New</td>
<td>USDA<br />
Official</td>
<td>Post<br />
Estimate</td>
<td>Post<br />
Estimate<br />
New</td>
<td>USDA<br />
Official</td>
<td>Post<br />
Estimate</td>
<td>Post<br />
Estimate<br />
New</td>
</tr>
<tr class="even">
<td>Market Year Begin</td>
<td></td>
<td>01/2005</td>
<td>01/2005</td>
<td></td>
<td>01/2006</td>
<td>01/2006</td>
<td></td>
<td>01/2007</td>
<td>01/2007</td>
</tr>
<tr class="odd">
<td>Area Planted</td>
<td>6010</td>
<td>6010</td>
<td>6010</td>
<td>6100</td>
<td>6100</td>
<td>7000</td>
<td>0</td>
<td>0</td>
<td>8000</td>
</tr>
<tr class="even">
<td>Area Harvested</td>
<td>5200</td>
<td>5200</td>
<td>5200</td>
<td>5250</td>
<td>5250</td>
<td>5500</td>
<td>0</td>
<td>0</td>
<td>6000</td>
</tr>
<tr class="odd">
<td>Bearing Trees</td>
<td>2308</td>
<td>2308</td>
<td>2308</td>
<td>2400</td>
<td>2400</td>
<td>2440</td>
<td>0</td>
<td>0</td>
<td>2663</td>
</tr>
<tr class="even">
<td>Non-Bearing Trees</td>
<td>442</td>
<td>442</td>
<td>442</td>
<td>390</td>
<td>390</td>
<td>760</td>
<td>0</td>
<td>0</td>
<td>997</td>
</tr>
<tr class="odd">
<td>Total Trees</td>
<td>2750</td>
<td>2750</td>
<td>2750</td>
<td>2790</td>
<td>2790</td>
<td>3200</td>
<td>0</td>
<td>0</td>
<td>3660</td>
</tr>
<tr class="even">
<td>Beginning Stocks</td>
<td>2280</td>
<td>2280</td>
<td>2280</td>
<td>1980</td>
<td>1980</td>
<td>4602</td>
<td>2180</td>
<td>2180</td>
<td>2302</td>
</tr>
<tr class="odd">
<td>Production</td>
<td>38000</td>
<td>38000</td>
<td>38000</td>
<td>39100</td>
<td>39100</td>
<td>42000</td>
<td>0</td>
<td>0</td>
<td>50000</td>
</tr>
<tr class="even">
<td>Imports</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
</tr>
<tr class="odd">
<td>Total Supply</td>
<td>40280</td>
<td>40280</td>
<td>40280</td>
<td>41080</td>
<td>41080</td>
<td>46602</td>
<td>2180</td>
<td>2180</td>
<td>52302</td>
</tr>
<tr class="even">
<td>Exports</td>
<td>36500</td>
<td>36500</td>
<td>33878</td>
<td>37100</td>
<td>37100</td>
<td>42300</td>
<td>0</td>
<td>0</td>
<td>47300</td>
</tr>
<tr class="odd">
<td>Domestic Consumption</td>
<td>1800</td>
<td>1800</td>
<td>1800</td>
<td>1800</td>
<td>1800</td>
<td>2000</td>
<td>0</td>
<td>0</td>
<td>2000</td>
</tr>
<tr class="even">
<td>Ending Stocks</td>
<td>1980</td>
<td>1980</td>
<td>4602</td>
<td>2180</td>
<td>2180</td>
<td>2302</td>
<td>0</td>
<td>0</td>
<td>3002</td>
</tr>
<tr class="odd">
<td>Total Distribution</td>
<td>40280</td>
<td>40280</td>
<td>40280</td>
<td>41080</td>
<td>41080</td>
<td>46602</td>
<td>0</td>
<td>0</td>
<td>52302</td>
</tr>
</tbody>
</table>

+--------------------+--------------+-------------------+--------------+
| ## E               |              |                   |              |
| xport Trade Matrix |              |                   |              |
+--------------------+--------------+-------------------+--------------+
| Country            | Chile        |                   |              |
+--------------------+--------------+-------------------+--------------+
| Commodity          | Prunes       |                   |              |
|                    | (Plums,      |                   |              |
|                    | Dried)       |                   |              |
+--------------------+--------------+-------------------+--------------+
| Time Period        | Jan-Dec      | Units:            | M.T.         |
+--------------------+--------------+-------------------+--------------+
| Exports for:       | 2005         |                   | 2006         |
+--------------------+--------------+-------------------+--------------+
| U.S.               | 1984         | U.S.              | 2713         |
+--------------------+--------------+-------------------+--------------+
| Others             |              | Others            |              |
+--------------------+--------------+-------------------+--------------+
| Mexico             | 7508         | Mexico            | 3969         |
+--------------------+--------------+-------------------+--------------+
| Germany            | 4731         | Germany           | 3017         |
+--------------------+--------------+-------------------+--------------+
| Russia             | 3461         | Russia            | 2585         |
+--------------------+--------------+-------------------+--------------+
| U.K.               | 2231         | U.K.              | 1865         |
+--------------------+--------------+-------------------+--------------+
| Brazil             | 1694         | Italy             | 1554         |
+--------------------+--------------+-------------------+--------------+
| Poland             | 1422         | Poland            | 915          |
+--------------------+--------------+-------------------+--------------+
| Italy              | 1330         | Brazil            | 900          |
+--------------------+--------------+-------------------+--------------+
| Venezuela          | 1127         | Colombia          | 527          |
+--------------------+--------------+-------------------+--------------+
| Peru               | 827          | Venezuela         | 489          |
+--------------------+--------------+-------------------+--------------+
| Colombia           | 795          | Peru              | 480          |
+--------------------+--------------+-------------------+--------------+
| Total for Others   | 25126        |                   | 16301        |
+--------------------+--------------+-------------------+--------------+
| Others not Listed  | 6768         |                   | 4912         |
+--------------------+--------------+-------------------+--------------+
| Grand Total        | 33878        |                   | 23926        |
+--------------------+--------------+-------------------+--------------+
|                    |              |                   |              |
+--------------------+--------------+-------------------+--------------+
| Note: Year 2006    |              |                   |              |
| data are for       |              |                   |              |
| January through    |              |                   |              |
| August only        |              |                   |              |
+--------------------+--------------+-------------------+--------------+