South African grape season fraught with difficulties -

South African grape season fraught with difficulties

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South African grape season fraught with difficulties

South African grape growers and exporters are describing the current season as challenging with over supply from Latin American producers and quality issues due to variable weather in key growing areas.

Chile and Argentina both sent more grapes to Europe which coupled with the continent's unusally cold spell led to consumer demand problems.

Grower and exporter Afrifresh Group said the early part of the season up to the end of January was good.

However, Afrifresh's marketing director Andre de Klerk explained that by the beginning of February life had become more complicated.

"We were quite happy with the way the market was going until this point but by the beginning of February there were big adjustments on price which started with the cold spell."

He said the severe cold weather resulted in delivery problems particularly to the wholesale market in Eastern Europe coupled with Chile's decision to divert its early Flame grapes to Europe.

Exporter Sapex agreed Argentina and Chile's decision to up supply in Europe made life difficult.

Sapex manager for Europe Jannie Visser said: "At the moment the market is a real mess. Chile and Argentina sent more volumes earlier to Europe and there is an oversupply situation."

Color Fruits head of grapes Rosené Matthee added that Chile's larger than normal cherry supplies to the Far East for their New Year on Jan. 23, hadn't helped.

"Many people buy grapes because they are cheaper but because of oversupply of cherries they preferred to buy cherries rather than grapes," she said.

de Klerk described the quality of some Chilean grapes as variable but despite uncertain standards this had still created problems.

"There's a certain price level where it was attractive to buy the fruit even if the quality was a bit iffy."

Visser reported significantly lower prices with a 5 kilogram box of 10 punnets fetching around EUR 8 (US$10.6) compared with EUR 10 (US$13.2) last season. He added that for a 4.5 kilogram box across all varieties prices were between EUR 1-2 (US$1.3-2.6) on average lower.

de Klerk said the lower prices South African growers were getting this year meant most producers weren't breaking even.

"It's not sustainable for growers the way prices are currently are. It will be tough with these sorts of returns."

He added that Argetina and Chile increasing their supply to Europe had led to customers demanding higher standards.

"It's a symptom of the market when everyone is spoilt for choice they are more fussy on quality."

Extremely high temperatures at some points during the South African season coupled with rain and hail in the key growing area of Hex Valley River had also affected certain farms.

"There was less Thompson because of the rain and some of the varities harvested later were affected. The berry size and quality was less consistent which means you don't get the extra large berry which the Far East prefer," said Viser.

He explained this was why his company's export volumes to the Far East were lower this season, although shipments to the Middle East were a little higher.

de Klerk added that unlike citrus, alternative markets were limited essentially to continental Europe and the U.K. with the U.S., despite relaxing phytosanitary requirements, still too far away to be viable.

The Northern Province, Orange River and northern part of Berg River regions have finished packing, later cultivars such as Dauphine and Darlinka are expected to coninue until mid-April.

Matthee said South African had only shifted 50% of its volumes so far even though it was two thirds of the way through the season. She predicted the country would hit its volume forecast of between 50 to 52 million 4.5 kilogram boxes by the end of the season.

Related stories: Overlapping grape expectations in Europe

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