Chile’s Hortifrut is to move into berry production in mainland China after signing a joint venture with the country’s biggest fruit and vegetable producer and distributor Joy Wing Mau.
A new company, JVCo has been established, in which Hortifrut owns a 51 per cent stake and Joy Wing Mau holds the remaining 49 per cent.
The first berries are due to be planted at the beginning of 2018. Under the terms of the deal, Hortifrut will bring its production expertise to the new venture while Joy Wing Mau will distribute Hortifrut’s products in mainland China.
The venture will be funded by an initial capital outlay of US$15m –US$5m of which will be provided by the two constituent companies up front, a further US$5m will be invested in a year’s time, and the remainder will be subject to the prior approval of the board of JVCo, the company said.
This is the latest in a series of joint venture agreements that Joy Wing Mau has entered in to in order to expand its supply and distribution footprint in Asia. Yesterday the Chinese giant announced the creation of Joy Wing Mau Asia with Capespan and last month it acquired a minority share in Yunnan-based Shennong Variety Management (SVM), paving the way for the partners to market new fruit and berry varieties in China.
For its part, Hortifrut has also consolidated its global blueberry network through its merger last year with Naturipe Farms partners Munger Brothers. The new company Munger-Hortifrut North America, brings together the companies’ operations in the US, Mexico, Peru, Brazil, Argentina, Chile, Europe, Africa and Asia.
Blueberry consumption is growing steadily in China and domestic production has risen rapidly in recent years. Speaking at last year's Global Berry Congress in Rotterdam, David Smith of importer SVA Fruits said planted area rose above 26,000ha in 2015 and production is forecast to exceed 71,400 tonnes by 2018.
No comments yet