(Jan. 13, 10:10 a.m.) Chilean grape growers, shippers and marketing agents say a stronger peso is likely to provide a little cushion, even while the world and U.S. economies sputter.

There are concerns, however, with ever-higher production costs and uncertainty about American consumers possibly cutting back on grape purchases.

Ray Reed, manager of the Santiago office of the Vancouver, British Columbia-based The Oppenheimer Group, said the stronger peso is helping stem some worries.

“With the exchange rate improving, this has been a huge help,” Reed said. “(But) we still need to contend with an economic situation that may be very difficult this season for all growers.”

Ronald Bown, president of the Chilean Exporters Association, said the currency has been a key to maintaining a strong sense of optimism for the industry.

“The devaluation of the Chilean peso has been a key factor on the profits increasing, or better to say profits recovery, taking into account the adverse exchange rate that we had during last season,” Bown said.

“The estimates point out to an exchange rate similar to what we have in these days, so we should be expecting better returns for our product and lower prices for supplies in Chilean pesos.”

A slumping global economy isn’t going to change that, Bown said.

“The world crisis is not going to change drastically those factors, but we have to be very cautious to the demand behavior in each of the markets. That can vary the prices — consumer preferences, different mix of consumption, among others,” Bown said.

How much the situation improves this season is hard to predict, said Tom Tjerandsen, marketing director for the Chilean Fresh Fruit Association, Sonoma, Calif.

“A number of their costs were paid when the dollar was much lower,” Tjerandsen said. “It all depends on whether the dollar continues to gain strength during the selling cycle.”

Tim Dayka, partner in Dayka & Hackett LLC, Reedley, Calif., agreed that a stronger peso can only help the Chilean producers.

“It’s tough for me to judge how a grower nets profit, but the currency can do nothing but help their returns over last year,” Dayka said. “If you’re just focused on Chilean import deal, we’re all keeping our hope up that the currency maintains its level or even gets stronger.”

It’s a timely occurrence, Dayka noted.

“It’s certainly a contributing factor, but how and why on the order of a company that’s importing 1.8 million boxes of grapes,” he said. “We’ve all sat down and discussed how and why that is. All of these factors are certainly contributing factors. There are a lot of positive things actually coming out of the current global financial situation in our industry.”

A stabilization and/or a reduction in costs certainly will provide better returns, Dayka noted.

“It is going to certainly give producers a bump in revenue if we sell the fruit at the same prices as last year,” he said. “It’s automatic that they’ll receive that. Is that enough to get them to the desired profit levels? I can’t say.”

Lower fuel costs have helped as well, Dayka said.

“As energy prices have stabilized, you’re starting to see producers globally see a stabilization and, in a lot of cases, a decrease in costs,” he said. “The strengthening of the U.S. dollar has certainly made our market a little more attractive. If we were selling at the same price as last year, the growers are seeing a little bump just at the exchange.”

Dayka said the industry isn’t impervious to the faltering world economy, but there are some possibilities for success this year.

“I think when you speak to the retail community, certainly the economy is having some effect, but I don’t think it’s at the same level as other businesses are feeling,” he said.

“In our discussions, it’s an ongoing speculation on how much the economy is affecting our business. I think it does affect it to a certain degree, but I think we’re seeing pretty healthy interest and pretty healthy sales.”