Hex River grape harvest not abbreviated, contrary to earlier expectations

The packing of Crimson, making up around 80% of South Africa’s last tranche of grapes, is going at a desultory pace, with grapes taking its time to reach colour and slowing down packhouse activities.

The good news is that the season in the Hex River doesn’t look set to end particularly early this year but ought to end around week 14, a grape exporter reckons, which is quite normal for the Hex River Valley. The white grape harvest is through, now mostly Crimson is left and some other red and black varieties like Scarlotta Seedless.

“Every farm in the Hex River is in a unique situation regarding water. Some farms have had sufficient water throughout the season and yet their volumes are also down by 15 to 20%,” says Ryno Palm, head of marketing at FVC International. “You saw the same thing with the Orange River region this season – they get their water from the Orange River, so there they have no water shortage, but their harvest was 25% down this season because of grape size and bunch weight.” He thinks it’s the result of a number of climatological factors coupled with low reserves within the vines after last year’s large harvest.

However, he notes, it could be part of a trend wider than just grapes, a pattern of smaller fruit size that could play itself out in the citrus industries of the Western and parts of the Eastern Cape this coming season, particularly in water-insecure areas.

As for the sluggish pace of colouring, he says it’s actually a bit strange as night and morning temperatures have dropped over the past three weeks in the Hex River. “But I don’t think there’s a colour problem with Crimson, it's just taking its time, and perhaps that’s because there are fewer grapes and everyone’s waiting on those last volumes. We’ve seen some packhouses having to close for a day or two to wait for the Crimson to get on colour and it’s frustrating. But in 2015/16 large volumes of Crimson were also packed in the Hex River from weeks 11 to 14, so what we’re seeing this year actually follows the historical trend.”

While some traders ascribe the pressure on South African grapes in China and other South East Asian markets like Thailand and Singapore to the volumes of Australian grapes, he disagrees. “The number one competition for our grapes there are cherries from Chile which compete squarely with our fruit, but that applies to all fruit on the Chinese market. We started seeing the effect of Chilean cherries on the Chinese market already about ten years ago, but back then volumes were so much smaller.”

In Malaysia, too, South African grapes are under pressure but for reasons somewhat different, he explains. “In Malaysia there are incredible stock levels, incredible pressure on all types of fruit, and South African fruit are in a higher price bracket than those from India and Australia that are loaded on consignment. Our grapes are sold on fixed prices and if the importer can’t achieve some sort of margin, the fruit stand over to the next week, so our fruit don’t have the momentum of the Indian and Australian fruit in that market.”

He notes that in the past few years more South African exporters – particularly producer-exporters – have been sending grapes on consignment to China which takes the pressure off the system.

He’s optimistic about the European market. Despite a strong start by India beginning February, he doesn’t think the volumes of white grapes are necessarily too much for the market to handle. The last of South Africa’s white grapes are on its way to the European market.

The price stability for red and black seedless will gladden the hearts of the industry and he is inclined to think this stability will remain until the season has run its course. “For the last seven weeks red and black seedless traded within a €0.50 band which is a very good sign and it’s purely just because there are less fruit and better distribution. In the UK the price levels have remained unchanged since week1. Such stability isn’t totally unheard of. There’s a lot of Chilean red available in the UK so the focus isn’t so much on our red at the moment and we don’t get many enquiries. Supermarkets are well supplied but outside of supermarkets, trade is a bit dead.”

On the European market, where Chilean volumes are lower, there is more trading momentum, he continues, and a welcome stability to prices. “The situation is very different to last year when there was incredible pressure on the European market. To compare: last year it was about €8.00 FOT for 10 x 500g punnets and this year it’s €12.50 to €13.50 FOT for 10 x 500g, a bit lower for white grapes. I don’t foresee that the price will fall by more than €1 before the end of the season.”

Locally the market has picked up somewhat, with a stable and fair price of R100 (€6.84) per 4.5kg carton producer delivery price. As the season winds down and volumes become thin on the ground, around Easter weekend, the price is likely to pick up.

For more information:

Ryno Palm

Tel: +27 21 505 5960

Email: rpalm@fvc.co.za