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India's 2017 grape exports to Europe and China set to increase by 15% to 20%

Economic Times:  January, 2017

Pune: India's grape exports to Europe and China are expected to increase by 10-20% despite lower realisations from the UK as companies are confident that an increase in volume will boost business. "The exportable grapes production is expected to go up this year. Nashik, which supplies around 80% grapes, has 55,000 hectares area under cultivation. Of this, area registered for exports this year is 33,000 hectares, compared with 27,000 hectares last year. We have also seen an increase in the number of farmers approaching us for farm advisory in cultivating exportable grapes," said Ashok Sharma, president and chief executive of the Agri Business vertical of Mahindra & Mahindra. Though the onset of a full-fledged season has been delayed by two to three weeks due to the snowfall in Europe and the onset of winter in the growing state of Maharashtra, the country has already shipped 47 containers to Europe by January 12.

The number of grape orchards registered under Grapenet has more than doubled to 19,801 2016-17 from 18,327 in 2015-16. Incidentally, only those farmers, who have registered their orchards under the traceability system of Grapenet, are eligible to export grapes to Europe.

A good monsoon and excellent weather conditions are going to yield a bumper harvest of grapes. India had exported grapes worth Rs 1551 crore during the 2015-16 season. "Despite 15% depreciation of the pound, the supermarkets in the UK have not increased retail prices yet, due to which, price negotiation is taking time," said a corporate grape exporter, who did not want to be identified. Indian exporters are expecting to get more orders as Chile has shifted its focus towards the USA and Canada. According to Mahindra's estimate, around 6,500-7,000 containers will be exported to Europe, up from the 6,200 containers last year. "Also, there will be an increase of around 20-25% in the number of containers from India to China," said Sharma. On the price front, Sharma said, "Due to significant demand in Europe, prices will stay firm up to the first week of Feb and after that they will normalize. The returns to growers and exporters will be impacted but due to availability of additional volume of fruits, export volume will either remain the same or may even see a marginal increase than last year."

Other exporters said that farmer prices will be lower by Rs 5/kg to Rs 10/kg this year due to higher volumes and possibility of getting lower rates from the UK. According to the exporters, last year, farmers received rate of Rs 65/kg to Rs 85/kg, while as per the data available with Agricultural and Processed Food Export Development Agency (APEDA), farmers received an average price of Rs 93/kg during the 2016 season.