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BR Research

The case of exporting mangoes

They e juicy, they e sweet and they e a delight to eat. But apparently, they e not so lucky, as the king of fruits in Pakistan has not been
Published June 28, 2011

They
e juicy, they
e sweet and they
e a delight to eat. But apparently, they
e not so lucky, as the king of fruits in Pakistan has not been receiving
oyal treatment as far as exports to the US are concerned.
It appears that even though the US has allowed mango exports from Pakistan, the requirements and conditions to be met by both importers and exporters have made Pakistani mango exports a costly affair.
All mangoes exported to the US are required to be irradiated - a technical treatment for enhancing the fruits quality. Though this condition is generic to all mango imports into the US from any country, the case of Pakistan is an exception in that mangoes from Pakistan are required to be irradiated in the US only.
Despite the availability of local irradiation companies, Pakistani exports have to succumb to this condition of the US for around 2-3 years, which renders the process tedious for them. Adding to the ado are further constraints, explained in the words of Ahmad Jawad, CEO Harvest Tradings: "The Animal Plant Health Inspection Service (APHIS), a subsidiary of United States Department of Agriculture (USDA) has only approved Sadex Corporation (a Texas-based irradiation company) for the irradiation of Pakistani Mangoes once they arrive in the US."
Bearing in mind that Pakistani mangoes are allowed to be imported only to the Chicago airport as the first entry point, transport costs incurred in sending mango consignments for irradiation to Sadex and back again are an additional cost for importers.
But the bigger chink in the importers armour is Sadexs requirement of having the mango consignment insured before it is taken up for irradiation by the company. The insurance premium nets to around $6000 for every batch of mangoes sent to Sadex - indeed, an additional hefty number for the importers bills.
"The combined effect is an extra $10 for a 2kg carton of mangoes, which, together with C&F, would bring the cost per 2kg-carton to over $20," Jawad told BR Research.
Naturally, mango importers in the US are concerned about the financial feasibility of selling Pakistani mangoes as the high prices may not be able to clinch much of a market except for die-hard Pakistani mango fans. Neither is the brand positioning of Pakistans produce anywhere close to a level conducive for asking a high price based on a niche product differentiation.
Eyeing this, one questions why has the US allowed only a single company for irradiation of mangoes from Pakistan, giving an uncalled-for monopoly to the company to dictate its own terms with mango traders.
Further, why couldn the irradiation company be Chicago-based rather than one housed in another state? With the already high costs of transport by air, this is putting Pakistani mangoes at a competitive disadvantage.
Overall, this makes a case for Pakistani authorities to take up the matter with the US, and bargain for a relaxation of these conditions, or, better still, for allowing the irradiation of mangoes in Pakistan. If the authorities envision the growth of perishables exports of Pakistan, these efforts are much warranted.

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