State cranberry industry looks to China

WISCONSIN RAPIDS – If there's too much of a product and not enough buyers are willing to purchase, prices decrease. It's the simple law of supply and demand.

And the Wisconsin cranberry industry presently is struggling with this economic reality as the recent overproduction of the fruit has forced prices to tumble. Now, in order to ramp up demand, the U.S. industry is looking to expand its reach to countries far beyond its borders, such as China.

To jump-start this process, the Wisconsin Department of Agriculture, Trade and Consumer Protection, or DATCP, brought a group of potential Chinese buyers into the state — and the Wisconsin Rapids area — this past week to talk to local growers and tour local facilities.

The Chinese professionals who toured the area represented diverse businesses in China's e-commerce, wellness, retail and magazine industries. Along with attending local cranberry facilities, the buyers also attended informational sessions about the fruit and talked to growers, such as Ocean Spray and Wisconsin's Best Cranberries.

"The market is just starting to develop," said Tom Lochner, executive director of the Wisconsin State Cranberry Growers Association, about the demand for cranberries in China.

Though no official business deals transpired out of this week's visit, Lochner said the tour, funded by a USDA Specialty Crop Block Grant, was successful in introducing the product to businesses that previously might have not been as familiar with cranberries.

"At the end of the day, I think it establishes that relationship," Lochner said. "These guys are buyers of products, and we got the sellers here. If we can get them talking to each other, then they can see the variety of products that are available to take them back."

Wisconsin produces more cranberries than any other state in the country, according to estimates from the United States Department of Agriculture. In 2014, the USDA expects Wisconsin's cranberry yield to to be 5.39 million barrels, more than 60 percent of the nation's total cranberry production of 8.57 million barrels.

Roger Zhang, a representative for SMH International, markets American goods and products to Chinese consumers. He said the cranberry market in China has considerably picked up in the past three years as people have become more aware of the fruit and its nutritional benefit.

"Most of the stores carry the cranberry already," Zhang said.

Still, though it's available to purchase, the fruit is not domestically produced on a commercialized scale, and it does not command the same recognition in China as it does in the U.S. It's recognized more as a niche commodity, said Jennifer Lu, an international trade representative with DATCP.

"We need to create awareness of the product in the Chinese consumers' mind," Lu said.

Lu noted that China has seen an increase in demand for health-conscious products, and cranberries could fit into this category. Focusing on the fruit's nutritional benefits — and also integrating it into Chinese recipes and bakery goods — will be key marketing strategies, Zhang said.

"We have a different preference for food," Zhang said. "I think about, 'How to incorporate (cranberries) into Chinese food in the future?'"

Zhang said that younger generations in highly populated urban areas will be key consumer groups to target. However, he noted that SMH International was hesitant to market cranberries as a specialty product because it wants to make the fruit accessible to all consumer groups.

"If we treat (cranberries) as a specialty," Zhang said, "it will limit (the number) of consumers who will get it."

Lochner predicted that the industry will have more success if it markets the cranberry not just as a snack — but an ingredient.

"I think the success that we had in Europe and elsewhere has been because we had been able to ship dried cranberries or ship juice concentrate there," Lochner said.

Right now, U.S. suppliers dominate the Chinese market in the dried cranberry and cranberry juice and concentrate areas, according to a SMH and DATCP presentation. But Chile is making modest gains because it can offer the fruit at a lower price and in fresh supply.

Still, Zhang is optimistic about the outlook of the cranberry in his country.

"I think cranberry has a very bright in future in China," Zhang said.

Melanie Lawder can be reached at 715-423-7200. Find her on Twitter as @mel_lawder.

China Cranberry Market 2011-13

2011: $375 million

2012: $416 million

2013: $460 million

Source: SMH International and Wisconsin Department of Agriculture, Trade and Consumer Protection