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More favourable operating environment buoys the sector’s confidence

Increasing the desire for South African table grapes

The South African table grape industry is operating with more foresight than was ever before possible: aided by a prescriptive logistics model, they now run scenarios up to eight weeks in advance, ascertaining the most optimal logistics solutions. Although the 2024/25 season started slightly later, mid and late-season varieties are expected to follow the usual schedule, and a total of 76.4 million 4.5 kg cartons are forecast will be inspected for export by the end.

It's a third of the way through South Africa's grape campaign, and close to 25 million cartons (4.5 kg) have left up to week two, with no major hiccups.

Source: SATI 2024 Statistics

Producers are, however, encouraged to be ready to respond should challenges arise during the season and this means being proactive, says the CEO of the South African Table Grape Industry (SATI) Mecia Petersen. The industry organization represents the interests of 502 table grape production units. "Due to the slightly later start of the season, one of the challenges that could potentially arise over the next few weeks is a bottleneck as volumes peak, with some production regions also noting some middle to late varieties ripening quicker than usual."

Their logistics model offers recommendations for the optimal routes to markets and resource planning across the logistics landscape, should a bottleneck develop. It's a major advantage to where the industry was in the past, she remarks.

Transnova Africa, an independent logistics consultancy, was commissioned by SATI to build the logistics model which is this season, the project's second phase, run bi-weekly to generate scenario updates. "The results can be used as a tool to assist on-farm and commercial decision-making with the aim of optimizing logistical solutions and reducing costs," explains Jacques Ferreira, SATI's manager of commercial industry affairs. "The model can even suggest the best routes to market in the event of weather-related port closures or other unexpected events."

Ferreira points out that the model development process has been consultative, involving role-players across the value chain including freight forwarders, the government, producers and other industry organizations. "Our objective is to provide the most updated information on which commercial decisions can be based," he says.

Jacques Ferreira, SATI's manager of commercial industry affairs, with its CEO Mecia Petersen and Denene Erasmus, head of communication

Authorities supportive of export fruit industries
"We are really encouraged by the appointment of Michelle Phillips to the position of CEO at Transnet [state-owned ports authority] and Barbara Creecy as Minister for Transport," remarks Petersen. "The minister and the new leadership at Transnet have been very open to engagement with the industry."

She considers the commercial backgrounds of the chairperson of the Transnet Board, along with Phillips, a benefit.

Maintaining the standard of South African grapes in key export markets and developing South Africa's brand is SATI's mandate. Getting grapes to market quicker, in an optimal condition, is an important part of this. Another is to critically look at market potential.

"A major priority for us is to maintain our position as the preferred counter-seasonal grape supplier in the UK and the EU, where the industry still sends almost 80% of its volumes," Petersen says. They are very focused on growing their presence in other markets. South Africa has access to sixteen of the world's top twenty grape-importing markets; negotiations to gain access to the Philippines are at an advanced stage.


Top table grape importing countries (source: SATI 2024 Statistics)

To establish a market presence for South African table grapes in China, the industry ran a targeted campaign there for four seasons. "The market responded positively," Petersen says. "Importers and customers were impressed with the quality and taste of the fruit. However, due to various factors, including increased domestic production and internal economic pressures, export volume growth to this market has been slow."

Last year the Chinese trade promotion campaign expanded to include Vietnam, where they perceive opportunities.

"Vietnam is getting a lot of focus," she says. "It's been called the rising star in South East Asia, attributed to its population size and age profile, who are exposed to Western foods, as well as the rise in technology in Vietnamese retail spaces."

Source: SATI 2024 Statistics & Perishable Products Control Board (PPECB)

North American windows attract
"There's also a lot of focus on the USA and Canada," Ferreira says. "There is some growth in our US exports, albeit from a low base, but South Africa currently holds an 8% share in the North American market." More than half of those volumes are white seedless. Petersen adds: "It's not a new market for South African grapes, but it's one where we've recently seen an increased desire for South African grapes."

This neatly aligns with their objective to increase their market share within the North American region. "There are windows in the supply to the US market, slight gaps between Peru and Chile, and that's typically where we enter," she says. "We're very much in those windows of opportunity and increasing consumer awareness of the quality product we can offer is an important part of growing South Africa's market share."

Grape trade with the Middle East and Africa is modestly growing (at 5% and below 5%, respectively).

Sustainability remains a key priority for the industry's long-term outlook, and remaining abreast of trends in major markets, such as the potential implications of the EU Green Deal, is an important part of that. Petersen concludes: "It's important that we see ourselves as an industry as opposed to individual entities. We're in a good place in terms of that."

Read the 2024 edition of SATI's statistics booklet

For more information:
Denene Erasmus
South African Table Grape Industry
Tel: +27 21 863 0366
Email: [email protected]
https://www.satgi.co.za/