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September 15, 2011

Europe debt woes drive South African fruit exporters to seek new markets

Europe's debt woes have hurt demand and prompted fruit exporters in South Africa, the world's second-largest citrus fruit supplier, to seek new markets in Asia, an industry official said on September 14.

"Portugal, Italy, Ireland and Spain all take our fruit, but demand levels are lower. However, we are also finding that the food inflation prices are higher than previous years, so the lower volumes are being offset by higher prices," said Stuart Symington, chief executive of the Fresh Produce Exporters Forum.

He said South Africa currently exports 2.5 million tonnes of fresh fruit annually, of which about 70 percent is destined for countries in Europe.

Only Spain exports more citrus fruit.

Fruit farms are a significant source of employment in rural areas in a country with a jobless rate of over 25 percent and according to Symington export earnings should top 12 billion rand in 2011.

"We are looking to the Far East to expand our efforts ... Indonesia, Thailand, India, Vietnam, China, South Korea, the Philippines, Taiwan and Japan," Symington said.

"Europe is still a very important market for us, but it is risky to put so much of our export volumes into one regional market."

He added that South Africa would probably be comfortable in the very long-term with shipping 40 percent to 50 percent of its fruit export volumes into Europe.

Strong commodities demand from South Korea, Taiwan and Japan has so far helped boost South African maize exports.

The country also had to look for new maize export markets after some of its traditional outlets within the region also harvested bumper crops.

Reuters

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