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September 08, 2011

Tomato production and processing project planned for South Africa

A long-heralded tomato production and processing project will make the Eastern Cape the premier production area for processed tomatoes in South Africa if it is successful.

After eight years of hard work by the promoters, Cape Concentrate’s completely new factory in the Coega Industrial Development Zone (IDZ), north of Port Elizabeth, will receive its first truckload of tomatoes for processing in September.

The project has involved an investment of R200m so far on agricultural development and processing facilities.

The project was led by Post Harvest and Environmental Technologies (PHET, formerly PHT). Its primary financier is the Development Bank of Southern Africa, followed by Jonah Capital Group headed by Sam Jonah, a Ghanaian business magnate. Jonah holds 58% of the shares in Cape Concentrate; PHET holds 42%.

Cape Concentrate’s long term vision is to replace most of the 460,000t per year which sub-Saharan Africa imports in tomato paste from China, Italy and Turkey. It plans to do this via four more plants similar to the Coega plant elsewhere in southern and west Africa.

PHET expects to scale up to full processing capacity within a few months. Full capacity will be 350,000t per year of fresh tomatoes received (an average of about 1,000t/day), resulting in 48,000t of paste production.

Cape Concentrate aims to derive about half of its input tomatoes from its own production, and half from contract production by small and commercial farmers. Cape Concentrate is continually looking for commercial and contract farmers, offering commercial farmers fixed forward prices for production.
Cape Concentrate has produced a detailed manual with all the specifications involved. Production will meet Globalgap requirements. In cases where Cape Concentrate does the farming on community land, it has undertaken to train community farmers.

Why is Cape Concentrate taking on the enormous extra burden of doing its own production rather than enlisting contract production? Because this is an entirely new sector in the area and the company needs to prove in practice its assertion that tomatoes - regarded as a difficult and disease-prone crop by many SA commercial farmers - can be successfully grown in the Eastern Cape.

And, of course, as a processing company, Cape Concentrate needs to have the security of supply.

Commercial farmers in the Eastern Cape are wary of new schemes – they have been buffeted by failures in chicory, cotton, etc; and the planned production of sugar beet has been much hyped, but that project could well fail.

Cape Concentrate, via subsidiary agricultural companies and joint ventures with communities and other trusts, now has 800ha of irrigated or irrigable land for own production and plans to increase this soon to 1,500ha on which to farm for the Coega project (later this will be much increased again, if the planned duplicate East London plant, to be sited at Berlin, about 300km from Coega, goes ahead).

Total production for the Coega plant will have to be on 3,500ha, producing 350,000t of tomatoes per year (about 100t per hectare per crop).

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