Prices of South African grapes on the European market remained steady after Christmas, held in check by supply, leading to prices higher than usual this time of the year.South Africa’s last two grape-producing regions are now harvesting: the Berg River region, responsible for about 23% of South Africa’s volumes, followed by the Hex River region where a third of South Africa’s grapes are grown.
Nico Kotze, marketing director at Bonaire Fruit in Franschhoek, notes that on the early volumes coming in from the Hex, like Autumn Royal, Starlight, Thompson Seedless and Crimson, the sizing is good and the area’s water is still holding. Grape growers in the Hex River Valley depend heavily on underground water. Hopefully there will be sufficient volume to capitalise on the grape price which is around 15 to 20% higher than last year this time. The drought makes it difficult to predict with accuracy what can be expected.
There have been some rains in the Western Cape over New Year’s weekend and a week later as well but since then temperatures have soared into the forties and beyond, fortunately coming down to below 30°C this week.
A Hex River Valley grape farm (photo by Louise Brodie)
Bonaire Fruit focuses on grapes from Namibia, the Northern Cape and the Hex River valley, bookending the grape season. “Namibia started strongly but the end was disappointing,” he says. “The berries were smaller. The region had many cool days which was unusual, where the normal daytime temperatures are at around 35°C and upwards, and this influenced the colour and the sugars.”
Post-Christmas grape prices in Europe steadier than usual
The good news is that the big drop in prices after Christmas on the European and UK market didn’t happen. “Prices were more constant than other years, we didn’t see the big fall that we’ve seen before. Many of the European retailers focus on South African grapes for as long as they possibly can, which is good news for us. There was a bit of panic because of lower volumes, due to lower bunch weight, arriving.”
The damage to Red Globes in the Olifants River region affected mostly markets in the Middle East, Malaysia and Sri Lanka.
Marketing to the Far East is on a more conservative keel than last year, he notes. Last year a large volumes of grapes went to the Far East (volumes more than doubling, from 2,355,329 x 4.5kg cartons over 2015/16 to 4,803,851 cartons last season, according to SATI’s figures). This year they are much more selective regarding cultivars and volumes, taking about 40% of the grape volumes they took last year, he estimates.
“When the drought is over, we’ll return to high volumes, around 70 million cartons, and then we will need new markets,” he reckons. For the moment, this season's crop estimate lies between 55 and 60 million cartons.
For the moment, grapes are moving briskly. The bulk of their product goes to Europe and the UK, diversifying to the Middle East, Russia and the Far East over the past three weeks. By the end of January, India is expected to enter the European market.
“It’s interesting times. The picture’s positive at the moment but we remain cautious of issues that could have an impact, like whether the Hex River’s water will sustain the harvest through to the end,” he concludes.
For more information:
Nico Kotze
Bonaire Fruit
Tel: +27 21 876 2250
Email: nico@bonaire.co.za