South African fresh fruit exports to US expected to grow

South Africa's exports of fresh fruit to the US had almost doubled since 2002 to $67 million in 2006, US ambassador to SA Eric Bost said in April. And the market was expected to grow as Americans were being encouraged to switch to a healthier diet. However, he warned that some members of Congress were questioning why South African fruit was coming into the US duty free under the African Growth and Opportunity Act (AGO) , when South Africa, with its strong economy and budget surplus, was "no longer a developing country but now a developed one."

Stuart Symington, the chief executive of the Fresh Produce Exporters' Forum, said the US market still accounted for less than 1 percent of South African fruit exports, with Chile exporting four times as much to the US because of its proximity to the market. The UK and continental Europe were still the main markets for South African fruit, and the current dollar weakness made it more profitable to earn pounds sterling and euros for exports.

Exports to mainland China, unofficially through Hong Kong and officially through ports in South China, were higher than to the US at about 1.5 million cartons of citrus and grapes. South Africa had officially been exporting citrus to China for 10 years and had been given official permission to export table grapes about a year ago. However, it was hard to forecast which of the two markets had the greatest potential to grow. China had a larger population, but a smaller percentage was likely to be able to afford imported fruit than was the case in the US.

Symington said representatives of Asda, the European subsidiary of US retail giant Wal-Mart, were now trying to buy fruit directly from South African growers, bypassing the export companies. But they were likely to have limited success because many growers obtained finance from the export companies, since the banks would not lend on crops that were still growing. The banks would accept only fixed property as security.

Symington said India, with a population of 1.1 billion including 600 million vegetarians, was a promising market, particularly as its seasons ran counter to those in South Africa. But despite recent rhetoric about the importance of two-way trade, high duty on imports into India made it hard to do business there. Pakistan was a promising market and had "fantastic varieties of fruit"
to be imported by South Africa.

Business Report