South African lemons: silver lining to European citrus campaign

Egyptian Valencias are a major spoke in the wheel for South African navels and Valencias in the EU and Russia, in a season when calibres are smaller, causing some nervousness around the marketing of unpopular counts.

“We’re not panicking but the prices aren’t what we were hoping for,” says Hannes de Waal, MD of the Sundays River Valley Citrus Company. Another navel exporter sums it up: “The navel season isn’t wow but it’s not a disaster."

After an inauspicious start with Satsumas, fraught with quality problems, followed by a heavy Nova crop that was difficult to market, coupled with a difficult grapefruit season, there’s an atmosphere that ranges from cautious optimism to annoyance with European traders who bought large volumes of Egyptian oranges of dubious quality at very low prices, well-aware of the imminent South African volumes. Moreover, it’s difficult to compete with Europe’s own abundance of summer fruit and even in Russia, the World Cup doesn’t seem to be stimulating South African citrus consumption because their market, too, is flush with Egyptian and Moroccan fruit.

South African navel quality is “ten times better than last year”, says a trader dealing with navels from the Eastern Cape, with very low levels of spoilage and quality problems, just some wind scarring, influencing packout percentages. The current cold temperatures across the country will be to the benefit of colour development.

However, navel calibres from across the country are smaller, placing pressure on smaller counts. The largest navels in the country come from the Sundays River Valley this year. Because the Middle East is a market for small fruit, they're getting a lot of South Africa's navels, placing the market under pressure. It doesn’t help that Ramadan was earlier this year.

The price-sensitive Far East market looks good at the moment and for traders who are exploiting other markets like Canada, the going is good.

In the Eastern Cape the navel season is about halfway through (not necessarily in terms of volumes), with about two weeks left on the navels and navelates. The Rand has been losing value against major currencies, which is an aid to South African exports at the moment.

The lemon campaign is stable, given the volumes going out. Earlier prices fell by a third but for the past month the prices have stabilised and started picking up.

Heavy rains in Argentina have impeded their lemon season and the Argentinian export increase of up to 30% wasn’t realised, to the relief and surprise of the South African industry.

“I’m pleased by the current sales tempo on lemons,” says the SRCC’s Hannes de Waal.

In the Gamtoos Valley of the Eastern Cape farmers are fervently hoping that the rain and snow of the Western Cape will move eastwards. The Kouga Dam is the lowest it has ever been, at 7.8% full. Citrus producers in the Patensie area are very worried by the continuation of the drought.