This spring, Honeybear Brands of Elgin, Minnesota, is shipping its largest crop of Honeycrisp apples to the United States from Chile — more than 250,000 cases to the East and West coasts in late April.
Ten years ago, the company planted its first 20 trees in Chile. “Today, there are well over 500,000, making it the largest Honeycrisp holding in the Southern Hemisphere,” said Don Roper, Honeybear Brands vice president.
The apples’ northern journey begins after the U.S. Department of Agriculture pre-approves them in Chile before loading them onto the ship. It takes 17 to 19 days by freighter to arrive at their destinations in shipping containers.
Then the apples move to two third-party warehouses in Vineland, New Jersey, via Philadelphia, and to its own Brewster, Washington, warehouses, via Seattle.
Priced at $90 to $95 a case f.o.b., the company plans to sell its product to its premium retail partners. That’s roughly double the cost of a 40-pound Honeycrisp box in the fall season, said Karina Gallardo, Washington State University Extension economist.
Despite the premium pricing, Roper said there was still plenty of room for retailers to make money. Selling apples in this second season, “when sales are relatively flat,” will give their partners a significant advantage over the competition.
Gallardo agrees having apples at that time of year is an advantage. “May, June and July is the time of year when supplies of apples are at their lowest,” she said.
Honeybear Brands’ partners include Wegmans, Big Y Foods, Walmart, Costco, Publix, HyVee, Meijer, Kroger, Target, Cub Foods and H-E-B. “It will take them 3 1/2 to 4 months to run out of them,” Roper said.
Even though Honeybear’s second season shipment may offer retailers an opportunity, the 250,000 cases, while significant, will not make a huge dent in the market.
According to the Washington State Tree Fruit Association, Washington shipped a little less than 6.7 million boxes in the 2014-2015 crop year.
Honeybear Brands’ Chilean shipment would total a little more than 3.5 percent of last year’s crop.
Competitors aren’t concerned about Honeybear Brand’s second season Honeycrisp either. “I’m not worried,” said John Rice, vice president of Rice Fruit Co. in Gardners, Pennsylvania. “It doesn’t sound like an overwhelming number of boxes.”
Rice said he is more concerned about new varieties “fighting their way into the market.”
“There have been 70 apple varieties introduced in the last 10 years,” he said. “No supermarket is going to carry all 70, but nearly all of them carry about 10.”
The markets have room for another two or three varieties, and “everyone is fighting over providing the other two or three,” he said. •
– by Dave Weinstock