South Africa’s perishable produce industry continued to exceed expectations and managed to move just over 3.5 million tonnes of fresh produce last year, according to the Perishable Products Export Control Board (PPECB).
Lucien Jansen, CEO at this independent quality certification agency for cold chain producers and exporters of perishable food, said that they continued to see a growth in exports. “We are pleased to note that South Africa achieved record export figures in 2022. Notwithstanding the challenges faced. This represents an 8.8% increase in volumes when compared to 2020/2021 financial year.
The agency said challenges that concerned the movement of fruit and vegetables included congestion at the local ports, which was a long-standing concern. In addition, it said the floods in the latter part of 2022 in the Lower Orange River significantly impacted grape crops.
PPECB said that the continued load shedding also remained a concern and put pressure on the industry as a whole. It said that the inconsistent electricity supply imposed challenges for the cooling of fruit making it significantly more difficult to maintain consistent temperatures and uphold the quality of the produce.
The industry body, however said, that it believes there was significant potential for growth into Asia, a market that already took up around 19% of all SA fruit exports. However, it added, that market access became more stringent as trading protocols of trading partners continue to change.
Jansen said that over 60% of local produced fruit in SA was exported and as a net exporter of fruit, the country relied heavily on markets abroad. “The global economy is however under significant pressure which ultimately impacts the disposable income of consumers worldwide. This further impacts exporters who already operate in a highly competitive environment. Discerning international buyers are particular as to what they purchase from South African exporters (and) must therefore pack products of a high quality in order to remain competitive. Rising input costs on the production side and packaging material remains a concern, adding additional cost pressures on producers and exporters,” Jansen said.
Nonqubeko Sikhakhana, an economist from the International Trade Promotions, Sub-Directorate- Trade Research at the Department of Agriculture, Land Reform and Rural Development (Dalrrd) wrote in the latest issue of the Trade Probe publication produced by the Markets and Economic Research Centre of the National Agricultural Marketing Council (NAMC) that South Africa’s citrus industry was mainly export-driven. “South Africa was ranked the second largest citrus fruit exporting country after Spain, with a share of 11.5% in the world’s exports for citrus fruit in 2021. Demand for citrus fruits remains strong in South Africa’s export markets, with the Netherlands as the main destination market holding a 20.5% export share. This global citrus demand coupled with expanding area under citrus plantation in South Africa should encourage government to open more export opportunities for local citrus farmers,” Sikhakhana wrote.
In the same publication, Dr Moses Lubinga, a senior economist in the Trade Research Unit at NAMC wrote that whereas countries have put emphasis on addressing non-tariff barriers to trade, most especially sanitary measures, not as much attention had been accorded to subsidies, one of the key technical barriers to trade faced by most developing countries due to their limited financial resources. “However, in the past decade (2010-2020), the usage of subsidy measures has grown significantly in number (710%) (OECD, 2022), thereby rendering increased protectionism,” Lubinga said.
Distinct kinds of subsidies exist, including direct public expenditure, tax breaks, equity investments, price supports, government provision of products and services and favourable preferential procurement practices and lenient lending conditions.
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