Traders report greater stability in African markets

Strong demand for South African apples in the Far East

Last week most apple shipments from South Africa were still destined for the UK, but the focus is now increasingly on Africa and the Far East and Asia as EU and UK retail and industrial programmes come to an end. Traders are quite positive about how the pomefruit season has turned out.

“The second half of the year is proving to be a bit better than the first half, better than we expected. Africa’s picking up its head. We’ll probably end a bit earlier, definitely on pears, perhaps on apples as well,” says Jacques du Preez, HORTGRO general manager: trade & markets. 

Granny Smith is doing really well at the moment as CA volumes start tapering off in a year when Granny volumes were lower and sizes smaller; traders say that they were very pleasantly surprised by the prices the right size counts of Grannies obtained through EU retail programmes.

“Grannies are looking really good, we’re packing for Malaysia, quite a bit, and other markets in the Far East where the market’s strong,” says Cathrine Smuts of De Keur.

“There’s generally lower availability of Grannies in certain size specifications, so there’s nice demand but I don’t think the current pricing structure in the Far East is sustainable into 2018,” says Ian Snetler, marketing manager for Africa and the Far East at Kromco. “It was quite tough in Malaysia and Singapore but it’s picking up for Grannies.”

Good demand for Grannies is also reported from the Middle East. The Qatar embargo has posed some problems from traders, affecting shipping lines and re-routing containers. “Delayed vessels were challenging, but the fact that oversupplied product in Dubai can’t enter the Qatar market creates a more stable market and better trade options,” says Elona van der Merwe of Cape Five Exports.

Granny Smith exports, standing at around 4 million, equivalent of 12.5kg cartons at the moment, are on par with the previous two years.

The apple trade is currently primarily based on Golden Delicious, Granny Smith and Pink Lady/Cripps Pink; the latter obtaining good prices in Europe and the UK (but volumes were lower because of colouration issues). There are also reasonable volumes of Fuji still going out, mostly to the Far East where demand for the cultivar is strong.

Despite full markets earlier this year, Royal Gala/Gala exports are up from last year, edging closer to 7.7 million equivalent cartons (12.5kg).

More stability in African trade
Most traders report that trading prospects in Africa look better than last year. “Movement is better than last year, but pricing is still low. What has helped in Nigeria was a trading allowance of US$20 000 per receiver per month by the banks,” explains Ian Snetler.

“Consistency is better and prices are lower this year, but we find demand always picks up somewhat towards the end of the year,” says Elona van der Merwe.

Total apple exports to Africa mirror last year's volumes of 5 million equivalent cartons, with Golden Delicious by far the dominant cultivar.

Other traders, however, have told FreshPlaza that in their experience, the African trade situation is as sluggish as last year. 

The Far East and Asia region is increasingly proving its dominance among markets for South African apples, taking pressure off the traditional EU and UK market and allowing traders to limit the risk inherent to trading in Africa at the moment. Cumulative YTD week 33 figures showed a 12% increase in apple exports to the Far East and Asia. There’s still room to grow in huge markets like India and Indonesia. There was also growth in exports to Russia (up 22% YTD) and the USA/Canada (up 35% but from a very low base).

Pear season to end early
The pear picture looks a bit different with the last two months of the season tapering off with weekly export volumes at around 200,000 equivalent cartons (12.5kg); mostly Packhams Triumph and Forelle at the moment. Overall Europe is still the main market for South African pears, but export to Europe and the UK ended earlier than last year. There’s been a big increase of pear exports to Russia.

At this stage of the season most pears go to the Far East and Asia, particularly India, Indonesia and Malaysia, followed by the Middle East. Jacques du Preez predicts that the pear season will end earlier this year due to expected reduced volumes.

For more information:

Jacques du Preez
HORTGRO
Tel: +27 21 870 2900

Ian Snetler
Kromco
Tel: +27 21 850 6819

Elona van der Merwe
Cape Five Export
Tel: +27 21 850 4640

Cathrine Smuts
De Keur
Tel: +27 23 315 5605

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