Volumes of South African grapes are more plentiful than they were at this point in the season last year. But rather than pointing to a season with a lot more fruit, early volumes are simply a consequence of an earlier start to the season.
“What has happened is that the season is earlier from all areas,” explained Charl du Bois of Afrifresh. “We are obviously not going to end up with 50 percent more fruit, the season is just going to end earlier.” As of December 15 this year, 12.2 million cartons have been picked. That's significantly more than the 7.7 million cartons that had been picked by the same date last year.
“I think we'll end up with about 54 million cartons from South Africa, which is more than the 50 Million of last year, but in line with the 55 million cartons of grapes that were harvested in 2011/2012 and 54 Million in 2012/2013 said du Bois. “So even though right now the volume of fruit might be more than last year, it will still end about the same as the three-year average.”
While the total amount of fruit harvested is expected to remain on par with previous years, exports to all destinations are higher year on year. Du Bois estimated that shipments to the United Kingdom and Europe have increased by 50 percent over the last year, and shipments to Asia by 80 percent and the Middle East by 250 percent, respectively. The European Union takes about 65 percent of exports, the United Kingdom takes about 20 percent and the remaining 15 percent go to Asia and the Middle East. Shipments to Russia this year have been difficult because of the falling value of the currency there.
(Photo) New 500HA empowerment development in the Orange River called Berekisanang.
Demand for red seedless grapes has been robust because of a relative dearth of those kinds of grapes early in the season.
Overall, prices have been lower than in previous seasons for this time of year because of the large volumes early in the season. That's put stock pressure on distributors who don't have the regular demand from retail programs and had weak fruit, but it has been less of an issue for those that do have programs and have better condition fruit. Du Bois hopes prices will stabilize as weak fruit is worked out of the system and supplies come down, but he's not sure how quickly the market will react.
“Prices came down very quickly and very early, and we're right now probably selling at prices that will turn out to have been too low given the overall industry volumes for 2014/2015,” said du Bois. “Although it is always difficult for the market to correct itself once you've sold a lot of fruit at a low price this has happened before when reality and sanity eventually returns.”
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