According to a report published by USDA, South African exports of deciduous fruit are projected to increase in MY 2012/13 as a result of increased production and increased demand in non-traditional African and Middle Eastern export markets. Demand on traditional European markets remains weak, while shipping costs are increasing (an increase of up to 30% in freight rates is being proposed by Maersk and SAFMARINE, in the face of rising demand for containerised shipment). However, challenges arising from escalating input costs have been eased by a weakening of the value of the rand.
Among southern hemisphere producers, South Africa ranks first in production of apples and second in production of pears. While apple orchards in South Africa are aging, orchard renewal is a slow and expensive process. Nevertheless, apple exports since 2010 have increased by 27%.
While exports to the UK grew by 11%, having recovered from a decline of 3.3% in 2011, exports to Benin and Angola, South Africas main African markets, have risen by 72.2% since 2010, taking their combined share of South African apple exports from 9.8% to 13.3%. Exports to the UAE meanwhile have grown by 24.5% since 2010. It is against this background that South Africa hopes to find new export opportunities in Africa, the Middle East and Asia in the coming years. Potential African markets identified beyond Benin and Angola include Zimbabwe, Kenya, Zambia and Cameroon.
South African apple juice production increased to 165,000 tonnes in MY 2012, up 5% as a result of strong export demand. The Ceres brand has been particularly successful in developing export opportunities, and is now exported to over 84 countries in Africa, Europe, North America the Middle East, Far East and Asia. These exports largely serve the premium end of the market, with potential new markets being constantly evaluated for long-term sustainable growth and commercial viability.
There is in addition growing demand for fruit juices in South Africa itself, given the expanding middle class. However fruit processing is not seen as a major revenue generator, given the far higher prices that can be obtained for fresh whole fruit rather than juice on both export markets (five and half times higher) and domestic markets (almost four times higher).
South African pear exports increased by 4% in MY 2012, recovering to slightly above 2010 levels to 181,928 tonnes, after falling in 2011. For pears, the EU remains the largest market, although between 2010 and 2012 South African pear exports to the three main EU markets fell by 18%.
South African table grape production is expanding (+22.4% between 2010/11 and 2012/13), with South Africa now the third largest global exporter by volume, and fifth by sales value. This expansion has been driven by strong returns in export markets and relatively low costs of establishment. These low costs have allowed the successful entry of black farmers into table grape production. Production is increasingly focused on seedless varieties.
Exports of table grapes to the EU have stagnated, with increases in exports to the Netherlands balanced by falls in exports to the UK. In contrast, exports to Hong Kong, the UAE and Russia collectively grew by 39.8% between 2010/11 and 2012/13. However, these countries still only accounted for 15.3% of South African table grape exports, compared to 63% for the two main EU markets.
According to USDA, the shifting focus of South African grape exporters towards non-EU markets is in part linked to the less stringent non-tariff measures (ethical; sanitary and phytosanitary [SPS]; technical barriers to trade) applied by these countries when compared to the EU.