USA is a meaningful destination for South African stonefruit this year

From Fresh Plaza | 2 March 2023

Overview of stone fruit from South Africa in the U.S. market, complemented by charts from Agronometrics. Original published on March 2, 2023. 

Icon Fruit, a joint venture between the Unlimited Group and Cape Fruits Produce, has a good mix of everything Stonefruit, says Lohan Marais, commercial director.

“We’re seeing good Brix on stonefruit, it’s been one of the better Brix years on all varieties especially on plums and even on early plums,” he says. Small sizing has been a characteristic of many Stonefruit varieties this season.

Their portfolio consists of plums (including much of the interspecific plums that are grown in South Africa), nectarines and peaches, plus some pears, apricots and cherry plums. (They are looking into cherries.)

Their plum season is exceptionally long, running from November to weeks 18 or 19. Local retail is supplied with plums until the beginning of June.

Advisability of a reduction in South African plums

“If you look at past three seasons, it has been very difficult for growers. As yet we haven’t seen lot of plum orchards cut down, but if this season is as difficult as the past three seasons have been, we’ll definitely see growers start cutting orchards down.”

He observes that it might be a good thing if South Africa scaled down on plum volumes, “maybe we should get back to 12 or 13 million cartons.”

The latest estimate for the 2022/2023 season is 13.45 million 5.25kg export cartons which will be 14% down on last year. Fruit is small, resulting in fewer cartons packed.

Promising late season

The South African Rand has weakened significantly against the USDollar over the past few days as international confidence in the country’s economic governance evaporates. Today the rate is R18.40 for a USDollar, a month ago it was R17.20.

A strong dollar makes freight more expensive, while much of South Africa’s stonefruit is sold in pound and euro markets.

Rising costs have made life very difficult for stonefruit growers, Lohan says, and on top of the packaging logistics costs growers are burdened with an electricity grid in crisis. A strong dollar cancels out the effect of freight rates coming down.

“Early in the season prices were under pressure but recovered during the mid-season with better prices than last year,” he says. “It seems as if we’ll have a strong tail-end to the season with better prices than last year. I’m cautiously optimistic because factors like the harbour that’s struggling to load and the wind can cause trouble, but it does look like we might have a better season than last year.”

They’re just hoping for less wind in March; during February gusts cased around two weeks of delays at the port.

all commodities volumes 10

Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)

Almost million fewer cartons of SA plums to Europe

“Everyone is fighting for shelf space. There are loads of berries, grapes, stonefruit, you name it. On plums our main competition are Angeleno plums from Italy that are stored with Smartfresh. When Italy has a big crop, they go on very long and it has a negative impact on prices. This year Italy was in the market until December which brought down our early prices.”

Fortunately when the US market became difficult for Chilean plums, the country spread its crop between Europe and the Far East.

He continues: “Europe is a plum consumer, we just need to give them the right product,” noting that with their producers they have been trying to bring in new varieties on especially interspecific plums.
“We’re looking at red-fleshed varieties, bigger fruit with very good eating quality. They need to give you good tonnage, that’s very important.”

He adds that they really do see a positive difference with better varieties.

Stonefruit export to the United States increased through some EU volumes sent to the USA this year.

“The USA is a new market for us and people are loading quite a lot of stonefruit there at the moment. It will be a meaningful market this year.”

South Africa still trades 40 to 45% of their Stonefruit in Europe, with a further 20 to 25% in the Middle East and smaller amounts to Canada, India, Hong Kong, Malaysia and Singapore.

“We are trying to do more in the Far East because it’s a dollar market,” he notes.

Russia still needs fruit, China is a lost opportunity

Because the Middle East takes small fruit, that destination was quickly overloaded and rapidly became a no-go area with very low prices.

Overall South African Stonefruit export to Russia is on par with last year’s volumes, even though freight costs are double than shipping to Rotterdam. The high prices are absorbed and Russia still needs fruit, he says.

“We can’t ship to China which I feel is a lost opportunity for South Africa.” Container prices to the UK, the EU and Russia haven’t really significantly decreased but nevertheless, the retail programs in the UK and the EU will always be a top priority.

Packaging costs are becoming “insane”

Packaging paper prices increased over 20% YOY over last couple of years, Lohan observes. They mostly do not send Stonefruit in punnets.

“We need to find a way to bring that down. For the growers it’s simply becoming too expensive at the moment. I was talking to some of our producers – when you’re packing a pear carton, it’s insane, it’s really extremely expensive.”

Meanwhile, he points out, the selling price stays the same, making it a tremendously challenging environment for fruit growers.

Flat peach trials

Rain cut short the peach and nectarine seasons this year.

The future of peaches lies in flat peaches, Lohan remarks, but South African growers are still struggling to find the flat peach varieties that perform well in South Africa. They are looking for varieties that set well and whose fruit don’t crack.

There are trials on flat peaches for a couple of years, struggling to get varieties that set well and don’t crack, lot of technical issues.

“We’re pleased with some of the new nectarine varieties, some of the early nectarines have better Brix and better sizing and they look promising,” he says.

Icon Fruit starts with apricots in November as well and supply late apricots into February, which is not the latest in the country, but most apricots are harvested by December.

“I also think South Africa could do more with apricots in the right microclimates.”

The News in Charts is a collection of stories from the industry complemented by charts from Agronometrics to help better tell their story.

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