Chile frost hits fruit crops and wine, emergency declared

October 3, 2013

SANTIAGO, Oct 3 (Reuters) - Chile declared a state of emergency on Thursday after a late frost caused an estimated $1 billion worth of damage to fruit crops, potentially hitting wine production as well.

The affected central region is the main fruit and wine producing area in Chile, the world's No.7 wine producer, and includes vineyards owned by prominent local wine label Concha y Toro.

The industry is one of Chile's most important after copper, with fruit exports worth $4.3 billion in 2012 and wine worth $1.8 billion, according to government figures.

"These frosts are the worst that agriculture has faced in 84 years, impacting the area from Coquimbo to Bio Bio," the national agricultural society said as Agriculture Minister Luis Mayol pledged aid for affected farmers.

Fruit trade association Fedefruta has given an early estimate of up to $1 billion of damage from the extensive cold snap in late September.

It estimates the frost damaged between 35 percent and 61 percent of stoned fruit crops, 57 percent of almonds, 48 percent of kiwi crops and 20 percent of table grapes.

Early wine grape varieties such as Chardonnay and Pinot Noir have also been hit. Chile is best known for its Carmenere grape variety, as well as Cabernet Sauvignon and Merlot, and wine-making plays an important role in manufacturing.

However, Fedefruta said most crops had not yet reached full flower and was not yet possible to give an exact damage forecast.

"The good news is that there exists a strong commitment from the government authorities, the bank and the unions to help the affected producers," said Patricio Crespo, head of the national agriculture society, which held an emergency meeting with the government and creditors on Wednesday.