The Egyptian grape season is about to start once again. we asked Hans Korsten for his expectations of the new season. Hans still has a good business relationship with Frankort & Koning, but no longer works with the trading company on an exclusive basis. "I am now active and available for multiple market parties, which means I have dealt with Germany, France, Turkey, Russia and Dubai, as well as the Netherlands, in the last year."
When asked how the productions are this year, Hans replies: "In white grapes we have to distinguish between the early and the normal seedless varieties. The early - Early Sweet and Prime - will produce the same or slightly later yield level as previous years. There has been extension in these varieties because - as I heard - more export licenses have been granted (both varieties have royalties). So there will be a bit more of the early on the market without it disturbing it."
"For the main cultivation in the normal varieties (main variety Sugraone) a considerably lower production is expected (up to 30%) due to lower returns in the older fields as a result of the weather, without going into technical detail. Over the last two years a lot of 'adventurers/exporters' have lost a lot of money due to the over supply on the European market, resulting in losing prices. A lot of these market parties won't be around this year and there is also a lot less Sugraone 'under plastic', so not early. Egypt is normally its own biggest competitor, especially in June, and this could be not so much the case or not at all this year."
Hans doesn't expect any big changes with new varieties on the market any time soon. "It is very important that when you introduce a new variety it positively distinguishes itself from those already existing. In recent years there was some commotion around certain new varieties from the ARRA family, but now the disappointments here are bigger than the successes. Whilst the search for new varieties is painstakingly continued, it doesn't look like existing main varieties in Egypt such as Early Sweet, Prime and Sugraone for white and Flame for red will be deposed any time soon. More so because these are proven, good varieties for the Egyptian conditions and also have an excellent reputation as a quality product in the market (Flame sometimes to a lesser extent). The professional growers and breeders, however, will also continue to look for improvements and they will arrive at some point, but not in a short term."
Empty market
"The season will get going later this year. The first notable harvest amounts are expected around the 18th of May, with which Egypt is over a week later than usual. The first Flame (red seedless) will be harvested around the 16th of May. Due to the empty market high prices are expected of course, and people will do everything they can to get on the market as quickly as possible. So it's logical that there will be a lot of 'flying' at the start of the season, which will make the product extra expensive. There can be a difference of up to 6 Euro per box in costs between the cheapest, but still fast, sea connection and airfreight (when chartered), which is huge. The low Euro is a cause of this. The Egyptian pound is directly linked to the dollar, so if a declining Euro isn't compensated for in price, this results in declining income for the Egyptian export. To name an example: an exporter needs 21 Euro as a wholesale price when they use airfreight to generate the same income as last years 17 Euro," calculates Hans.
Commercial crime
"Due to the empty market and consequently the tendency to start as early as possible, there is the danger that market parties will bring grapes into the trade that have been harvested too early, 'sour' grapes. This is why I want to appeal to all those concerned to stop this 'commercial crime'. In the end they are letting the people pay a lot of money for something that can not be eaten. They are simply a victim of deceit as they're getting something sour when expecting something sweet," argues Hans.
"Apart from market parties I am also appealing to controlling instances in Europe such as the KCB in the Netherlands, to carry out brix respective flavour tests as this does not happen enough to keep unsavoury parties out of the trade. The above mentioned instances can get very worked up about 5 grams less fruit in a bowl, which the consumer won't notice, but inedible fruit, which hits the consumer in the shape of a 'total loss', has no problem entering the market!"
"I'd like to point out that product like this is sent knowingly and willingly and so you don't have to feel sorry about the consequences for those concerned. I don't need to elaborate on the damage this does to the reputation of Egyptian fruit. Unfortunately the Egyptian government does not do enough to eradicate the phenomenon. On a European level I'd like to propose that noting a minimum brix value on the packaging should be made mandatory."
Russia
When asked how important Russia is to the Egyptian grapes, Hans replies: "Russia can't be overestimated as a market. After all, this is 150 million people, with a not too impressive average purchasing power. The GDP per head of the population in Germany (80 million inhabitants) for instance, is three times as high as that of Russia, and these are figures from 2013 when Russia was still doing well economically. The Russians are certainly facing economic hardships at the moment and the consumer is feeling it. As long as grapes still have high prices, the sales to Russia will be limited. However, I should say that Egypt is in Russian sights as an alternative source to Spain in the winter, mainly for open ground vegetables, which is a very remarkable development. Citrus and potatoes have been going to Russia in large amounts for decades and the same could go for a series of open ground products in the future, even after the possible lifting of the embargo."
The negotiations for market access to China are also ongoing. "The potential of China is mainly in varieties such as Red Globe and Crimson, which has extended greatly in Egypt in recent years, there are huge possibilities for them as they are popular among the Chinese. Opening the Chinese market is very important for Egypt," says Hans.
Your Partner in Sourcing
He expects to be of value in Egypt for importers this year once again. "There is still the need in the import market for a man you can trust, and just meeting at a trade fair like Berlin absolutely isn't sufficient as a base for a sustainable business relationship. The energy put into forming relationships and certainly then in maintaining it, I can take care of that, and parties can be sure of my expertise, integrity and contact characteristics."
"Our world is continually changing and people can often only keep track of them by being on the scene regularly, despite the most advanced methods of communication. Working with the same supplier for twenty years doesn't have to be an advantage if you're not careful that they aren't exceeded by others. As far as countries of origin are concerned I can find my way around most of Africa, South Africa to a lesser extent, as well as Egypt, and as 'Your Partner in Sourcing' can find the perfect match for everyone."
For more information:
Hans Korsten, Korsten Johannes SP Co
Your Partner in Sourcing
26 Gelf El Choueifat
5th District, New Cairo, Cairo
Egypt Mobile: +20 1011199694
Mobile Holland: +31612415600
Skype: korsten1