Producing high-quality fruit for the export market isn’t a sideline for Oregon Berry Packing.

“It’s what we’ve been about since the late ‘80s,” said Jeff Malensky, president of the grower/packer company. “We’ve focused on exports.

“What we try to do is grow berries that can make the quality for those markets,” he said.
Oregon Berry Packing is one of several Oregon packers that dedicate a sizable percentage of their harvest to the Asian market. It’s a market that has grown in size and importance in recent years.

Japanese magazine featuring Oregon blueberries.

“We used to think export was kind of fun,” said Thomas Payne, an export consultant for the U.S. Highbush Blueberry Council (USHBC). “Today there are packers in Oregon that depend on the Asian business.”

Even packers who don’t ship to Asia are benefiting from the exports, said Mike Townsend of Townsend Farms.

“I think that opening up that route to sell the fruit has allowed us to clearly move more of this increased volume that we have experienced over the last five years,” Townsend said.
“We have just about doubled our output of blueberries the last five years,” he said. “Korea and Japan have both helped us in moving the product.”

For Oregon Berry Packing Japan remains its number one customer, Malensky said, but other markets are increasing in importance including South Korea, Singapore and Hong Kong.
“This year it seems like Korea has been more active (than in the previous two years),” Malensky said. “Last year was fair. This year was better in terms of seeing the interest actually hit.

“Interest in blueberries is one thing,” he said. “Buying is a whole different thing. This year it seems like they caught on to what we’re about.

“And it helped that the tariff is going down,” Malensky said.

When it comes to frozen blueberries, the Korean market is expanding at an even more rapid clip and today is the largest destination for U.S. shippers, Payne said.

Oregon blueberries featured in Japanese cooking show.

According to an article in Fresh Fruit Portal, which quoted Very Berry Korea Corp. CEO Chaesup Rim, frozen blueberry consumption in South Korea has increased from 489 metric tons in 2008 to nearly 10,000 metric tons, or 22 million pounds, in 2013.

Much of that increased consumption was coming from the U.S., Payne said, despite the fact that U.S. frozen exports pay a duty of 17.5 percent, while Chile, which has a free trade agreement with South Korea, pays none.

“One thing we found out is that Korean food processors prefer the U.S. varieties,” Payne said.

Oregon remains the only state in the U.S. that is allowed to ship fresh blueberries into South Korea. Again, Oregon pays a tariff to enter the market, one that is declining each year. It started at 45 percent in 2012, the first year Oregon was allowed to ship fresh blueberries into South Korea.

“We thought things would get going quicker, but, in reality, when you add 45 percent on any price, you’re going to have some sticker shock, even for the amount of interest over there,” Malensky said.

Oregon growers and packers also have to meet strict protocols requiring them to trap extensively for pests and document efforts to control pests. Packers are visited each year by Korean representatives, who audit operations.

Despite the tariff and strict protocols, Oregon shipped nearly 225 metric tons, or nearly 500,000 pounds, of fresh blueberries into Korea in 2012. Last year, the state shipped 350 metric tons, or 770,000 pounds.

And, according to preliminary figures, Oregon shipped 1.2 million pounds to Korea in 2014.
Chile, which followed Oregon into the program and is the only other country allowed to ship fresh blueberries into South Korea, shipped 650 metric tons into South Korea last year, or 1.4 million pounds. That number is expected to increase, as well, in 2014, as Korean consumption continues to rise.

Despite the dramatic increase in consumption in Korea, Malensky said that about the only development that could unseat Japan as Oregon Berry Packing’s number one market is if China were to allow imports of fresh product.

“China used to be a competitor of ours,” Malensky said. “They used to ship to some of our customers in Japan. At that point we were concerned because we spent a lot of time developing relations with customers in Japan and to see that go by the wayside to somebody that can produce blueberries a lot cheaper, it was concerning.

“Now that is no longer a concern because China has developed its own market and they get much better return if they keep their berries internally than if they were to export them to Japan or somewhere else.

“They’ve gone from being a competitor to being a partner in this,” Malensky said. “And the more they develop that market, the better it will be for us when this thing does open up. “Without a doubt, China could easily become the number one export market when it is legally acceptable to ship there,” he said.