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Agro-Chile: Viticulture an evolution in time

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Three years ago a Chilean Viticulturist Italo Schiappacasse started with a spare area using his many grape varieties to test out the open gable growing system. He has been attentive to the demands of the overseas markets and better still, he now has them at his fingertips.

Difficult. This is how last seasons table grapes have been described; a situation that generated the need for change. Many have opted to incorporate new varieties which in some cases can fulfil the function of replacement and in others, complement. However, the key to success is to anticipate the changes that are going to be required in the future, as a result of changes in consumption and new market demands. This was understood by Italo Schiappacasse, who is dedicated to the production and export of his grapes in the fourth region, and that some years ago managed to anticipate the future needs of the market.

The key? To know the needs and requirements before anyone else.

His beginnings in agriculture go back to the early age of sixteen years old when due to family necessity and being the eldest of four brothers, he began to work in a small plot of about twelve hectares by himself. In 1979, thinking about its growth potential, it was planted with table grapes, which corresponded mainly to Flame and Thompson varieties.

At that time, he recalled, a national market was observed with the possibility of producing vegetables and Pisquera grapes but this was a slow growth profile. “We chose to look for a path that we saw could grow over time,” he said. And so it turned out. “Subsequently there was a tremendous boom in the export of table grapes, so there was little chance of buying more land with his budget at the time.

From there he began to rent properties from neighbours and over the years he was able to buy some extra land which he continued to do over time, always in the same area, ” he recalls adding that he owns twelve blocks now located between Vicuña and Paihuano, which total 300 hectares, of which 180 hectares is planted with table grapes.

Anticipating change

New demandsItalo 3 of the markets are a current reality, but it is not something new, but it has been happening for a long time starting as a trend. But to this is added the speed with which the markets are now evolving.

As Italo recalled, ten years ago consumption habits took about twenty years to change, whilst today everything happens very quickly, which requires having as soon as possible the supply of products or production of new varieties that the market demands.

This is precisely what this producer understood and accomplished. In his case, it was having his own export activity which made him realise it sooner than most.

With the passing of time the Agroindustrial Society ISS Ltd, the productive area of his company, Agrexport was added, the entity in charge of making the shipments of his products, which allowed them to have a very direct relationship with the final consumer, that is to say, the North American, European supermarkets, and many other markets to which they are shipped.

“That’s why we started to react to these changes three years ago, when we introduced a replacement program,” he says, adding that in the last two years they have planted about eighty hectares of new varieties, of which a large volume will enter production in the subsequent season.

Sugra 14, Sweet Celebration, Timco, Timson, Alison and Krissy are the varieties that make up the replacements they have been making and that add to the traditional Thompson, Red Globe, Superior and Flame. In this case, more than a replacement, it is about the incorporation of new varieties, since they do not come to replace but to complement the pre-existing supply.

“Today La Flame is well questioned, but I think the discussion focuses on the product and not the variety. La Flame in California produces the fruit of good size (18 to 20 mm) and with good productivity. Flame sells well in the market, that is, the variety is not vetoed. But it is harder for Chile to reach these calibers with fruit of good colour and healthy. If you arrive with a good Flame, with a good product, the fruit will be sold and maybe it will be sold very similar to what a new variety fruit is worth “, he explains and adds that each producer must look for mechanisms to count with a product different from the one that the industry offers today.

But there is a factor that the new varieties play in favour compared with the traditional ones: the greater productivity. And, according to Italo, a new one may be producing around 3,500 crates without major efforts, while a traditional one can produce between 2,500 and 3,000 crates but with more work. It is with this criterion the agricultural performs precisely the selection of the traditional varieties.

“Today we are concerned to select those that comply with that standard of production, the old ones that did not meet them and were not able to produce traditional varieties of good quality and condition, are not being cultivated,” he summarizes.

This is how the company has had an evolution in time and anticipated with respect to other players in the industry. Although all are aware of the requirements of the markets, which in their opinion may influence this decision regarding the incorporation of new varieties, in general it is associated with the payment of a royalty, which leads to a commercial scheme with whom sublicense the varieties. “Having that fruit is a bit more complex because you have to give it to a certain exporter. However, mechanisms have been sought so that the producer can reach a certain final customer, “he clarifies.

With these additions, there is an offer according to the needs of the market, which is also influenced by another type of change: the Open Gable, a growing system that has comparative advantages.

OPEN GABLE: The new plantations system

Itao 4This farm has a production of 360,000 crates of grapes carried out under the Spanish Parron growing system. However, he started testing Open Gable on a hectare that was planted last season, in which he had already visualised its advantages. Its main quality is that it allows one to work with the fruit within reach of the hands of the people and not above their heads.

It is estimated that there could be about 30% savings in labour costs between an Open Gable driving system compared to a Spanish one, “says Schiappacasse.

Under this system, the plant grows about 1.40 meters high. From there the wood is driven to the sides, where most of the fruit will be concentrated. This provides another advantage: the plant has a lower energy consumption because it should not reach up to two meters and have a lot of wood. So Italo Schiappacasse’s future plans point to the upcoming plantations targeting this growing system.

Fruit with an international destination

All fruit produce seconds, which in this case Don Italo destined for the production of raisins, taking advantage of 100% of the fruit in this way. These are mainly the discards of packing or parron that basically correspond to grapes or clusters that do not meet the quality standards that are required to be exported. Either as fresh grapes or as raisins, 100% of the fruit of this company has a final export destination, which in the first case is made through Agrexport, and in the second, by means of third parties.

The high level of production compared to local fresh grape consumption, coupled with the amount of supply that exists, were the factors that have led this company to devote itself purely to export and not allocate any of its volume to the domestic market. So today the United States and Asia are ranked as the main destinations, with 40% of shipments in each case, while the other 20% go to Europe, a market that qualifies as complementary. This is because it requires fruit of another type of quality, an area in which they could add to Mexico.

Efficiency Technologies

The markets of destination analyse different parameters of the fruit they receive, among which they emphasise quality and condition. That is why the use of technology to achieve them is vitally relevant. In the opinion of Italo, the packing and the cold storage are vital because the fruit they harvest should be packed in an environment that prevents deterioration and dehydration of the product.

Vicuña is characterised by having a dry climate that is associated with a minimum of fungal diseases. So Italo qualifies it as friendly for the production of table grapes and that it generates good colour and healthy fruit, aspects that are also influenced by the lack of rainfall.

However, something that affects this area of the country is drought. “The North, in general, is with a permanent drought because in a good year it rains 80 mm. For eight years we had very dry periods, with the last one about three years ago, where the dams of Puclaro and the lagoon were relatively dry and we only irrigated with the water of the river, “he says.

Italo 5But in this company efficiency has been imposed as far as technologies are concerned. So in the irrigation area, they implemented a system that aims to use the water that the crop needs in the most efficient way. “Five years ago we irrigated one hectare with 13,500 cubic meters of water but today we have humidity sensors associated with irrigation software, which tells us how much water the plant needs and when to supply it.

With this we have managed to lower the consumption of water to between 8,500 and 9,000 cubic meters per hectare, depending on the variety “. The same is true in the area of fumigations, where once a hectare was fumigated applying 2,000 liters of water with a product, applications can now be made using only 100 liters of water per hectare.

These are the latest technologies that have been incorporated in this company and while they are always analyzing which are possible to add, the diagnosis of Italo is that for now there is not much more that can be done. “In the table grape 65% of the costs are in labor and in this sense, we still have no alternatives available that can be incorporated to replace the labor or make production more efficient,” he emphasizes.

Product diversification?

Some time ago, within the products offered, the company, Capel’s Co-operate, also had Pisquera grapes, a crop that today has virtually no production. As Italo Schiappacasse recalls, at one time they produced a million kilos of this type of grape but eventually became old Parrones, which was producing very little, while the prices of these grapes fell considerably. “In the upper valleys it is difficult to produce Pisquera grape in high volumes because the climate is very dry; producing 25,000 kilos per hectare was not profitable to continue, ” adding that they do not plan to re-incorporate it, even in those areas which have been changed to table grapes.

But expanding your product basket is not something you reject completely. First, the objective is to consolidate the current growth,  to produce around 500,000 crates of grapes with the plantations they already own. That’s when I could think of diversifying the production matrix, also cultivating citrus fruits, which adapt very well to the dry climate zone.

Schiappacasse clarifies that there are crops of clementine that have done well in terms of production and date of harvest, plus it has a different installation cost than the grape and demands less labor.

Working together

There were many products in the marketplace that did not correspond to the quality that was sought. Thus, the fruit was accumulated in destination and the marketing was complicated for all that was arriving, resulting in lower income. This was the panorama that was experienced in the table grape industry in recent seasons. In spite of it, Italo Schiappacasse is optimistic. Warns that this season there will be a much smaller offer in volume and a lot better quality, which can be sold very quickly.

But in his opinion, there is a point at which the whole fruit industry must move forward, and it is the fact of being united to look for common goals, such as markets or soft financings for investments, aspects that are difficult to achieve on an individual basis.

“If it is a united industry or producers ‘ associations where they can join forces for a common goal, I think it can be achieved. You could try to have a more business-friendly infrastructure financing and put pressure on the markets to go in search of new ones, “he suggests and adds that cooperatives are ideal.

One of the pillars of the Ministry of Agriculture is to enhance the associativity and creation of cooperatives, however, knowing very well the case of Capel, Schiappacasse assures that they are very difficult to function efficiently.

The table grape industry has been challenged and still faces a number of challenges. However, Italo feels optimistic and all the difficulties he has managed to overcome until today give him a good reason. The key is to listen to the needs of the markets, but above all, to be one step ahead.

Source: Mundo Agro CL

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Geoffrey McRae

About Geoffrey McRae

Geoffrey McRae is the founder of GTSA - Marketing. He is a New Zealander with a strong Agro-business and Real Estate background spanning over 30 years both in his own country and South America. I hope you enjoy reading our news site. Please share it on your social media below.

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