Peru FoodNews 2010 - GBR

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A Global Business Reports publication
A Global Business Reports publication
15
“The consumption of anchovy in Peru is
growing and the product is already exported.
In Europe, where consumption of anchovy
is high, there have been shortages of this
product and Peruvian anchovy has found
a market there. 10 years ago, anchovy was
exclusively used for fishmeal”, explains
Antonio Bologna, General Manager of
Seafrost.
Thus anchovy is increasingly exported,
frozen and canned, under the anchovy or
sardine denominations. This complements
other hydrobiological products in which
Peruvian producers are increasingly adding
value, such as giant squid. José Cuadros,
General Manager of Perú Pacífico, gives
more details: “Five years ago the industry
was exporting giant squid as raw material,
but now there is a lot more value added,
with breaded fillets, hamburgers and others”.
Perú Pacífico has just inaugurated a plant
in partnership with a Japanese company to
process giant squid. “From a point of view
of labour, we are still more expensive than
China, however doing the processing right at
the point of extraction saves on other costs”.
More plants
Investments like these show that processing
at the point of extraction can make sense.
The value chain is shortened and there is
no need for buyers to ship the raw material
(which includes waste) to processing plants
in China before sending the product to
attractive markets such as Russia. But to
set up new plants in certain areas of the
Peruvian coast, or to increase existing
capacities, is easier said than done due to
infrastructural limitations. “Water here
can be more expensive than petrol. We
sometimes pay USD 12-13 per cubic meter
of water, and we consume 1 200 cubic
meters per day. There is water, but there is
simply no infrastructure to bring it here. In
the end, we will probably install our own
desalination plant”, complains Antonio
Bologna of Seafrost, a company based in
Paita (northern Peru).
Carlos Milanovitch of Dexim, who
also chairs the Committee of Human
Consumption Fisheries of the National
Society of Industries (SNI), says the
problem is already being dealt with: “The
government is working to tackle the issue of
access to water in Paita. I believe it should
be solved within the next two years”. The
problem must definitely be surmountable,
because Dexim recently invested in the
expansion of its production capacity to the
current five tons per day of finished product.
The plant permanently employs 400 people
and processes mostly hake, giant squid and
scallops.
Aquaculture for
development
Peru also offers great opportunities in
aquaculture, which has the advantage of
more predictability in production than
marine catch in years such as this. Currently
the biggest export products in this field are
shrimp, scallop and trout. Elie Barsimantov
of Iny, a company that has its own shrimp
and scallop cultivation units, but also
freezes other species from marine catch,
explains: “The products that are cultivated,
such as shrimp and scallop, are important
for us because we mitigate the fluctuations
in the availability of other marine products.
Today, shrimp represents 20% of our sales,
but it is difficult to grow rapidly in this
business because the aquiculture-related
investments are high”.
With regard to trout, this is cultivated in
the highlands for temperature reasons, in
areas where there are a number of obstacles
to overcome. The main one is the lack of a
reliable infrastructure to take the products
to the coast where they can be exported.
Marcos Moya, Deputy General Manager at
Piscis Piscifactorías de los Andes, Peru’s
largest exporter of trout, elaborates on this
issue: “Our production centres are all higher
than 3 200 metres above sea level, and three
of them are only accessible from Lima
through one busy road. It has happened to
us in the past that due to road cuts we have
had to fly the product at enormous costs to
fulfil the commitments with our clients”.
Moya declares that the demand for
their trout is higher than the company’s
production capacity, and that Piscis plans to
grow in volumes by 35% annually through
an increase in its own production capacity
and also through sourcing more product
from smaller trout farmers in the Andean
areas where they operate.
Seeing the potential of aquaculture
and its positive impact in areas in high
need of investments such as the Andes
and the Amazon jungle, the government
is implementing the National Plan for the
Development of Aquaculture (PNDA)
which expects the industry to double its
current production by 2015.
Prospects
These are definitely interesting times for the
Peruvian fishing and aquaculture industries.
The former has tidied itself up with the
introduction of sustainable fishing quotas,
and it is transforming itself into a provider
of food for the international markets; the
latter has enormous potential for growth
and, more importantly, can be developed
in the areas that have not profited from the
agriculture boom along the coast, which
should help balance the big economic
inequalities the country suffers from.
For Henry Quiroz, Manager at Hayduk,
a strong player in fish conserves: “This
country has a very rich sea and the fishing
industry is very important for the economy.
For many species there are significant
growth expectations. In giant squid, hake or
anchovy, we can really grow the volumes
for human consumption. There is a sea of
opportunities”.
INDUSTRIAL FOODS:
AN EMERGING
CUSTOMER BASE
The phenomenal performance of the
Peruvian economy is providing great
opportunities for producers looking
to expand their customer base.
Between 2002 and 2009, the Peruvian
economy grew by an average 6% annually
according to IMF data. This is resulting in a
growing purchase power for the middle and
lower classes and the introduction of new
products in their weekly shopping cart.
Following closely this development,
several Peruvian companies have taken
advantage of their local market knowledge
to put some of their products as the product
of reference in the consumers’ mindsets,
and to leverage on this strength to enter the
international markets.
Take, for instance, the example
of mayonnaise. Previously led by
multinationals, the market is now dominated
by a Peruvian brand, Alacena. Leslie
Pierce, CEO of Alicorp, Peru’s largest food
company and owner of the Alacena brand,
explains: “When we introduced Alacena
in 1996, we competed with Unilever and
Nestlé, who back then controlled virtually
100% of the market. Today, Alacena has
a 93% share in the Peruvian mayonnaise
market, which today is probably 15 times
bigger than in 1996”.
According to Pierce, the secret for
this success was based on two factors:
firstly, Peruvians traditionally prepare a
mayonnaise with a touch of lemon, which
Alacena introduced; secondly, the market
expanded dramatically: “Our competitors
were maintaining similar levels of sales and
therefore did not realise how fast we were
gaining market-share. When they tried to
react, we already had 50% of the market”,
continues Pierce.
The business of breakfast cereals offers
some similarities. Today, the market
is dominated by local player Global
Alimentos, a company that also works as a
co-packer of oats for Quaker. Its Managing
Director, Luis Estrada, gives more details
on how the Angel brand has beaten the
main multinationals in the field: “Breakfast
cereals are an emerging business in Peru.
The global big players used to import their
products and centre the distribution in
Workers processing squid at Dexim’s plant in Paita, northern Peru.
Humberto Speziani, Advisor
to the Board at Tecnológica
de Alimentos (TASA) and
President of the International
Fishmeal and Fish Oil
Organization (IFFO)