Dried pineapples offer new niche for South African exporter

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Dried pineapples offer new niche for South African exporter

In South Africa's KwaZulu-Natal province, a permanent staff of around 55 women work at processing fresh Queen pineapples into dried pieces and pulp for export to Europe.novapine

The female-dominant staff is just one element that sets the Novapine company apart from the standard fruit-processing company.

Although pineapple exporters in South Africa typically focus on fresh fruit sales, Novapine has turned to processed products in an effort to improve efficiency, explained company manager Lloyd Domleo.

"Due to high waste and price instability, the company has largely abandoned fresh sales in favor of dried fruit products and pulp for juices," he told www.freshfruitportal.com.

"The [fresh] market price wasn’t stable enough. We couldn’t generate a solid income and there was a lot of waste. There was a lot of reject fruit because our quality measures are pretty high. So we decided to take the reject fruit and put value on it.

"It took off so well, that we are actually taking choice-grade fruit and processing it."

The company began in 2007 and currently purchases fruit from seven local farms, including its own.

Domleo estimated that the company produces 75 tons (MT) of dried pineapple a year. With a wet-to-dry fruit rate of 35-to-1, that equates to over 2,600MT of processed fresh pineapples a year.

"We produce a specific type of pineapple which is the Hluhluwe Queen pineapple. It’s a lot smaller and sweeter fruit. To the best of my knowledge, we are the only people who choose to dry that type of pineapple," Domleo said.

"[In Zululand] we produce 95% of South Africa’s Queen pineapples. It’s the natural pineapple to use. If we dried other types, we would have to buy from other parts of the country, which isn’t economical. And it’s got a lot less moisture than other pineapples. We are in a very humid environment, so we have to use dryers."

Despite high transport costs, Domleo said the product has performed best as an export to Europe, due in large part to pricing.

"We have got a local farm store where we sell and you can buy straight from the factory but we find that the locals are not very accepting of new products," he said.

"[Europeans] are more open and that’s due to the exchange rate. It costs them a lot less than it costs South Africans because of the exchange rate. It’s cheaper for them to buy."

The economic power of the European market has not made product promotion entirely easy, however. With input costs on the rise in South Africa, Domleo said the company is facing one of its most difficult sales years.

"We’ve got huge electricity costs. With the new minimum wage, it’s increased our labor costs and our fuel costs have gone up. It’s becoming difficult to carry on," he said.

"[The minimum wage has] had a very, very negative effect. We try to keep as many of our staff on as possible because we know all of our staff members personally. We don’t like losing people. We’ve been under huge financial strain trying to keep them on and reduce our costs."

The increased pressure of input costs has shown in sales prices as well.

"The overseas markets don’t understand all of our changes. We can have price increases every month in this country and it’s just not normal for them over there. So we have found it difficult, especially this year with the cost increases," Domleo said.

"We don’t have as many orders for next year as we did at this time last year. People order in advance and this year a lot have said they are not going to order from us because our prices have gotten too high. The actual profit margin isn’t that great."

Although KwaZulu-Natal has been largely free of labor disruptions, Domleo explained that strikes in the Western Cape have had a national effect and forced the company to reevaluate its costs.

"The wage increase has affected us but we have just had to shuffle things around and reduce other costs to keep staff on.  This will be a problem if it carries on increasing because we aren’t going to be able to sell our product," he said.

He said in Novapine's case, staff tend to consult with supervisors for conflict resolution and largely prefer to avoid stoppages.

Photo: Novapine



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