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Chilean fruit export profits down due to freight increases

The increased cost of ocean freight has led caused lower profit margins for Chilean fruit exporters, according to the Association of Fruit Exporters of Chile (ASOEX) BB #:156234 and the Agricultural Society of Biobio (Socabio).

Ronald Bown, president of ASOEX, told La Tribuna that, “the rates are increasing considerably, which has us very worried, since the reality is that much more is being paid in relation to the freight we paid last year and the previous year”.

He went on to mention that a U.S. study shows that 25 percent of the price that the consumer is paying corresponds to the freight issue.

This increase has a direct impact on fruit producers and exporters throughout the country due to the fact that freight is a direct cost of the activity, and one of the fundamental concerns of the sector is that certain commodities, such as cherries, table grapes, peaches, nectarines, and kiwis, cannot directly absorb the increase in the cost of the freight.

Jaime Ugarte, the director of Socabio, said, “the cost of freight has risen between 30 to 40 percent, which affects the profitability of the crops that are exported, although it depends on the crop; in the case of fresh fruit, it becomes more expensive to export because it is important to export the crop as soon as you can”.

Marco Campos is Media Coordinator, Latin America for Blue Book Services