The National Agricultural Marketing Council hosted an event regarding South Africa’s fresh-cut produce chain on Tuesday, in which economist Thabile Nkunjana presented an overview of current developments in international trade and their impact upon South African fresh produce. Fresh produce has been subject to international turmoil and related climate issues and has been complicated due to the recent restrictions on trade.
“As as of the 13th March, 2023 around 22 countries had put in place 26 export restrictions on specific food items, while 10 countries have adopted 14 measures to limit exports which specifically affected the fruits, onions, potatoes and various processed foods,” He added.
Status of EU energy impacts veg trade
Africa is the biggest consumer of South African vegetable exports and will consume nearly two-thirds (64 percent) of the vegetables, dominated by potatoes and onions until 2022.
Asia and Asia and the Middle East accounted for 10 10% of South Africa’s vegetables exports. The share that is attributed to that of the European Union is a significant 22 percent.
“The fascinating aspect is that, out of to the European Union because of high costs of energy that affect the greenhouse industry and its supply of vegetables, we’re noticing possibilities in the near term to purchase South African fresh produce.”
Other than onions, there’s also a demand to South African pumpkins.
Problems in the European processing sector mean that the market will remain accessible He said.
The EU’s Green Deal will have an greater impact on the trading partners (and it is South Africa’s biggest market for fruits).
Producers must be aware of policy initiatives to reduce global warming, for instance the EU nitrogen reduction, which He said, could have the capacity to alter how fresh produce is processed soon.
Other African countries help fill the gap left by Botswana
Logistical inefficiencies within Africa allow South Africa to increase its presence on the continent, in which, he thinks that it has the potential to expand.
Botswana’s decision to shut their doors for South African vegetables in order to boost production in the country can be seen in number of trade transactions.
Right: Harvesting potatoes within Limpopo Province
“South Africa’s revenue from exports derived from the vegetable trade with Botswana is down by 50 percent due to the prohibitions placed in place on South African fresh produce,” Thabile told the meeting.
“Fortunately the demand coming of Angola, Mozambique and the DRC has recouped the losses from the Botswana commerce.”
Challenges
The top concern for vegetable farmers are the fertilizer prices that are subject to the fluctuations of international policies, like Russia’s conflict. fuel and fertilizers account for 25 percent of the costs for input for the standard South African potato producer.
He specifically mentioned the garlic and ginger as two of the commodities from South Africa for which the marketplace is still a concern due to the increasing imports.
The bilateral trade agreements between countries such as South Korea, China, Japan, Vietnam, Taiwan, India, Saudi Arabia, Bangladesh and the Philippines will be particularly valuable for South African fresh produce exporters the minister said in the manner it’s been implemented to South African beef exporters.
“These countries are home to huge populations with excellent economic outlooks. For fruit, especially, we must to concentrate on trade agreements with these nations. There is a chance to expand and increase the production of our fruit, but it’s crucial to make sure that local supplies are available and also to attract smaller companies to the market,” the official stated. “We must help smallholder farmers to commercial channels.”
“Generally although we are facing challenges, there is still a lot of opportunity for fresh food products that come from SA due to a growing market, particularly from the world, specifically in the field of vegetables.” the expert concluded.
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Thabile Nkunjana
National Agricultural Marketing Council
https://www.namc.co.za/