South African citrus: Avoiding logistical issues will be key to season - CGA
Avoiding logistical and operational issues will be critical to ensure a successful South African citrus season amid numerous challenges stemming from the Covid-19 pandemic, according to an industry body.
Justin Chadwick, CEO of the Citrus Growers’ Association of Southern Africa (CGA) said that while there had been some problems at departure ports in the first few weeks of the season, the situation is improving and the fruit is being packed and exported in relative normalcy. The ports have done a good job considering the difficult circumstances in 2020, he said.
The season's record marketing crop estimate of around 143m cartons - a 13% year-on-year rise - still stands. The fruit is on the trees.
"If we can move the fruit through our ports and into our overseas markets, we do believe that we will be able to sell that volume," he said.
But exports may end up lower than forecast, depending largely on how much demand is impacted by the loss of foodservice channels or any other factors. Lemons, in particular, are heavily reliant on foodservice, as are grapefruit in certain markets.
"The figure could come down a bit as we start ramping up the volumes into Europe - we might find that the demand just isn't there," he said. "So I'm cautioning the industry that we could come down by 10%, hopefully as a worst-case scenario. But if we can get the fruit into the market then we might be pleasantly surprised.
"These are very difficult times, nobody really has a map to go by. It's going to be a very fluid year, I think."
It will also be key this season for fruit to be sold at reasonable prices to help prevent any backlog of supplies in markets.
"I think the general feeling this year is that it's not going to be a market that's going to blow the lights out in terms of returns. If we price it right, the fruit will move," Chadwick said.
While citrus companies are taking measures to ensure worker safety - such as providing personal protective equipment, implementing social distancing, taking temperatures upon arrival - he said it was inevitable that there would be cases of some workers testing positive at facilities.
"There is a high likelihood of workers becoming ill as the virus spreads through communities, so we need measures in place that are going to keep the continuity of the business while at the same time looking after the health and safety of workers," he said.
"It's a difficult balance. So far we've managed to tread along that line, but we are concerned about any disruptions in the supply chain when workers become ill."
He said that although ports in Durban and the Eastern Cape are getting back to full capacity following some delays as the season got underway, a few days ago the port of Cape Town stopped operations for 12 hours after a number of workers tested positive for Covid-19.
"Anything like that immediately causes a backlog if the whole facility closes down. So we're trying to work with Transnet, the port terminal operators, to have a better approach," he said.
Early start for lemons
Overall, it's been quite an early season for South African citrus this year. Chadwick said that lemons kicked off very quickly, with shipments currently up by around double year-on-year.
"That was quite good because the markets were relatively empty of product," he said.
"Most of the early lemons went to the Middle East, although the reports are that there might have been a little bit too much shipped into that market in one week, so I think exporters are starting to shift a bit to other markets now."
Meanwhile, the grapefruit season has recently gotten underway, with a lot of fruit going through Durban over the last couple of days.
Grapefruit is now being prepared for export to South Korea, which recently gave South Africa the green light to carry out pre-clearance inspections.
In another positive development this season, there is an increase in the number of breakbulk vessels that will be used for South African citrus, with two already having departed for China and Japan carrying mainly grapefruit.
In soft citrus, the satsuma season is now wrapping up in the U.K., where exporters experienced relatively good conditions. The clementine campaign is getting underway, with fruit to be sent to a bigger mix of markets including Europe, Russia, the Far East and the Middle East.
Orange exports are yet to begin, with the earliest Navels now being harvested. Chadwick noted that while demand will likely be strong for oranges in western countries - which view vitamin C as a remedy for colds and flu - the situation is a little different in Asia.
"We had a chat with some Chinese importers, retailers and wholesalers, and their message back to us was that we mustn't rely on that sort of thing to boost sales because the Chinese don't really see it that way," he said.
Valencia oranges make up the biggest portion of South African citrus exports at 35%, followed by navel oranges (19%), lemons (18%), soft citrus (16%) and grapefruit (12%).