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Mission inks deal with Chilean avocado grower-shipper

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Mission Produce President Stephen Barnard signs the deal with Cabilfrut on the trade show floor during the PMA Fresh Summit in Atlanta. (Photo by Tim Linden)

ATLANTA -- On the trade show floor during the recently concluded Produce Marketing Association Fresh Summit convention, Mission Produce Inc. and Chile-based Cabilfrut inked a deal that transferred 50 percent ownership of the South American firm to the California organization.

"This is a very good deal for us and helps us in our goal of offering a seamless transition to our customers as they source our fruit," Steve Barnard, president of Oxnard, CA-based Mission Produce, told The Produce News.

Mr. Barnard said that the deal will give Mission greater control over its Chilean production and also allow the California firm to ship its "Mission" brand from Chile.

The agreement includes 50 percent ownership of Cabilfrut's packing and office facilities in Chile, and several hundred acres of production. The company has similar deals in both Mexico and Peru, so the "Mission" brand will now be available from all three of the major avocado-importing countries.

Juan Cerda, who along with his brother Fernando founded Cabilfrut in 1989, said that the deal will enhance the ongoing working relationship between Mission and Cabilfrut. He said that Cabilfrut has worked with Mission for many years, but this brings the relationship to a new level. He added that Cabilfrut is a well-known brand in Europe, which should benefit Mission in its export program.

Mr. Cerda, who is Cabilfrut's chief executive officer, said that the firm is one of the top five largest avocado grower-shippers in Chile, and it continues to expand its operation with additional plantings. He said that about 30 percent of the company's production is from its own groves but that number is steadily increasing.

Cabilfrut exports about 65 percent of its production with two-thirds of its export crop sent to the United States, 30 percent to Europe and 5 percent to Argentina. Mr. Cerda said that the domestic market in Chile continues to be a very strong market for the firm.

"Chile has the greatest per-capita consumption of avocados in the world at six kilos per person," he said.

Cabilfrut also is a citrus grower-shipper, which Mr. Cerda said will continue under the new ownership arrangement.

Initially, the deal will not add to Mission's volume since the company already had a sourcing deal with Cabilfrut, but Mr. Barnard said that the long-term prospects are for increased production from Chile.

Chile's production is just getting underway for the 2011-12 season. Over the next year, Chile and California are expected to have much larger crops than in the last 12 months, and experts are predicting that as much as 1.4 billion pounds of avocados will be sold in the United States in that time frame.