SA grape delay raises oversupply concerns

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SA grape delay raises oversupply concerns

South African exporters are concerned European prices might suffer due to shipments arriving two weeks later than normal because of a colder than usual December.

In general exporters are positive about this year's season but they told there were concerns about grapes arriving in large volumes in Europe at the same time.

Bet-El Fruits marketing manager Carel Nieuwoudt, said Europe was undersupplied leading up to Christmas but this has changed significantly since then.

"Lots of volumes have gone out in the last two weeks. This is making me nervous. There are a lot of volumes all arriving at the same time which will put pressure on prices," he said.

AMC Fruit SA marketing manager for the U.K. Cathrine du Toit, said while the cold December had let to better looking berries, sugar levels were lower than normal.

"Low sugar levels are a bit of a problem. We are just choosing specific growers with higher levels of sugar in the fruit. Normally, this isn't the case but this season we are having to do it."

Du Toit said her company generally sold to large supermarkets on a programmed basis with Marks & Spencer as its key retailer for the U.K.

Favourite Fresh Export marketing manager Hercules Myburgh, agreed prices in Europe were under pressure and  fruit arriving in cartons after Christmas was being re-packed and sold in punnets.

He said his company preferred to sell in continental Europe, which offered better wholesale prices than the U.K.

Despite late European arrival of grapes, both Myburgh and du Toit said prices overall this season were an improvement on last year's.

"It's slightly better than last year covering increases in packing costs. The return to growers is on a similar level to the previous year," she said.

Middle and Far East focus

Myburgh agreed, describing prices as a "little bit better than last year" and said his company was focusing on selling to the Middle and Far East.

"It's a fixed price market so you know what you're going to get."

Nieuwoudt described prices as level without any extreme fluctuations, but he was getting good prices for fruit in the Far East.

"Overall, I can't really complain, prices are stable and they aren't going up and down."

Myburgh said earlier maturing grapes were down a little in volume due cold weather but that quality in general was good.

He added his company dealt mainly with growers in the later maturing areas of Berg and Hex River Valley.

"In general the quality is looking very good, we did have some hot weather, for example temperatures reached 36 degrees centigrade last weekend in the Hex River Valley. Heatwaves can affect the color and cause blemishes "

He added the hot weather hadn't caused any blemishes or changes in fruit color, and was hoping there wouldn't be too many heatwaves.

Export figures

All three exporters said they expected to increase shipments significantly this year compared with last. AMC Fruit SA said it expected a 30% year-on-year increase reaching 350,000 cartons (1,575 metric tons, MT) with 65% of shipments going to the Far and Middle East and 35% to the U.K.

Nieuwoudt described Bet-El Fruits as a rapidly expanding company concentrating on sourcing fruit from small to medium-sized farmers, expecting a 100% rise in exports to 600,000 (2,700MT).

Favourite Fresh Exports said it expected to reach up to 550,000 (2,475MT) cartons this year representing a 57% year-on-year rise with 65% of shipments to the Middle and Far East, followed by Mauritius, Seychelles and Réunion island at 15%, then Russia and Europe each at 10%.

Related story: South African grape exports gather momentum

Photo: SATI

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