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Drought reduces volumes but stability in European and Middle Eastern markets buoys prices
Market redeems 2017/18 South African grape season
The last South African grapes – Crimson and some Scarlotta Seedless – should be on Northern Hemisphere shelves until the first or second week of May; shipments may still be leaving until the end of next week, while some exporters have already finalised their 2017/18 season.
“All in all,” says Ryno Palm, marketing head of FVC International, “in the end the stronger Rand didn’t have that much of an effect and in fact, if you look at the exchange rate at the end of October last year and now, there really isn’t that much of a difference.”
“Perhaps,” he continues, “the lower volumes were our salvation. In the end many guys packed fewer cartons but it was made up for on the market side, where currency prices attained were 15 to 20% better than last year. The UK and the EU markets remained much stabler over a longer period, which is very healthy for us. On a punnet of red we’re getting about €2 or €2.50 more than last year. Last year this time the market was quite depressed.”
The South African grapes on the European market compete with white grapes from India, which sell for less, and season’s end wasn’t, after all, hastened by the drought; an anticipation that resulted in some contingency plans among retailers for supplementary volumes, in case, and led to South African and Chilean grapes meeting.
He continues that the Middle East was an equally calm market this year, and so they could skirt the Far Eastern market a bit this year; the latter was a market where South African product found itself with less expensive Australian and Indian grapes and, crucially, Chilean cherries.
Only the Hex River is still packing, a valley with an astonishing rate of ripening running from south to north: the former starts packing Crimson in week 3 while by now, three months later, Crimson comes from the northern part of the valley, separated by only 25 km.
The big focus is now on citrus. Lemons are coming in from north to south, Satsumas from the Western Cape (beginning the week before Easter) and, starting next week, Star Rubies from Limpopo. “The volume and the size look good, I hope we’re getting good colour,” he says.
A record citrus harvest, as some have suggested? “I don’t think so, certainly none of our producers would use the words ‘record harvest’. Everyone is comfortable with the volumes they’re getting, and in some places with drought producers are feeling more positive than a while ago, there’s been a sprinkling of rain. There could be some size issues here and there, but in general it looks promising.”
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