Lemon business hits the tracks to sweet success
Businessman Dai Xiaoping never expected that the lemons handled by his company would one day reach overseas dining tables, but the Belt and Road Initiative proved to be a turning point.
Dai, the founder of lemon processing company the Huida Group, which was established in 2012 and is based in Chongqing’s Tongnan district, said his lemons had not been exported before the BRI was proposed in 2013.
“The BRI brought overseas buyers to Tongnan and helped them get to know about our business,” he said.
More than 40,000 families are involved in planting 13,000 hectares of lemons in Tongnan, and plans are in place for 30,000 hectares of lemon groves to be generating 30 billion yuan ($4.3 billion) in revenue by 2020.
Dai said that with the development of the BRI, he is “greatly confident” that exports of fresh lemons and related products from Tongnan will continue to grow rapidly.
The BRI, which comprises the Silk Road Economic Belt and the 21st Century Maritime Silk Road, aims to build trade and infrastructure networks connecting Asia with Europe and Africa on and beyond the ancient Silk Road routes.
A rail line running from Chongqing through the Xinjiang Uygur autonomous region and on to Europe, terminating in Duisburg, Germany’s biggest inland port, opened in 2011. It has increased Chongqing’s connectivity with other cities and countries.
According to the Yuxinou (Chongqing) Logistics Co, by the end of September, 2,375 trains were operating between Chongqing and Europe, taking the city’s goods not only to Central Asia and Europe, but to other cities in China and to nations such as Thailand, Singapore and Vietnam.
The Chongqing-XinjiangEurope line handled fresh fruit exports for the first time in 2016, transporting 30 metric tons of lemons to Kazakhstan produced by the Huida Group in Chongqing. It was also the first time the company had exported its lemons.
Dai said, “The convenience brought by the line is clear. It greatly shortens the transportation time and is the reason why overseas purchasers visit Chongqing so frequently.”
Last year, the Huida Group exported some 30,000 tons of fresh lemons worth 430 million yuan to 31 countries, including Russia and Singapore, by rail, road and air. Both the volume and the value of the exports were more than twice those of the previous year.
The group has also established trading companies in Russia, Kazakhstan and Hong Kong to help sell lemons and related products overseas.
For Dai, fresh lemons are only part of his business, with deep-processing (using all parts of the fruit) the key to success.
Huida has also brought in advanced production lines and equipment from overseas to help increase the added value of its lemons. It has developed about 300 kinds of products based on the fruit.
“The flesh of the fruit can be made into dried lemon slices and drinks, its skin and seeds into fruit tea, and the oil in the skin can be used in cosmetics,” Dai said.
One ton of fresh lemons can sell for about 8,000 yuan, while the same weight of dried lemon slices can fetch 120,000 yuan, he said.
Qu Qiang, a research fellow with the International Monetary Institute of Renmin University of China, said that while exporting their produce, Chinese agricultural companies should make careful long-term development plans, instead of “giving in quickly” over prices or currency fluctuations. Giving added value to agricultural products and building well-known brands is the key to success, Qu added.