Locally and internationally there are events taking place which will affect the South African produce industry – we are taking a look at a few of them.
Zero-tariff Brexit raises questions – reports Eurofruit
Brexit uncertainty is hitting new levels after the UK government’s suggestion it could impose zero tariffs on most fruit and vegetable imports
The UK government’s plan to temporarily abolish tariffs on the majority of fresh fruit and vegetable imports in the event of a no-deal Brexit has created yet more uncertainty for the fresh produce trade.
The new schedule of trade tariffs states that import duties will be cut to zero on all but a small handful of products, retaining a rate of €114 per tonne on fresh bananas, a 16 per cent levy on dried bananas, 10.4 per cent plus €1.60 per kilo on fresh or shelled beans, 6 per cent on whole vanilla and 8 per cent on whole cloves.
The publication of an apparently flat rate for bananas has raised eyebrows among those importing the fruit into the UK, given that the EU’s present regime applies different rates to different sources of supply.
South African table grape crop enters its final period
It is likely that South Africa’s grape export crop could be more or less the same as last year
The South African table grape crop is moving into its final period with weekly volumes in the late Hex River Valley region expected to start reducing from now on. With the harvest nearing its end, SATI is retaining its forecast that the harvest will end up between 63,2 million and 70 million cartons.
For this higher level to be achieved the two remaining regions, the Berg River and the Hex River Valley, and the last of the Berg River, will have to deliver some 15 million cartons in the coming few weeks. Observers therefore believe that it will be unlikely that this level will be achieved. In fact, the season so far has followed very much the pattern of last season when around 62 million cartons were exported.
Southern Africa will export another record citrus crop this year
Southern Africa’s citrus export crop will be marginally higher this year compared to last year
The first Southern African citrus forecast of the season shows that the third successive export crop in a row will be exported this year. However, while the two previous years represented steep increases, this year’s volumes will only be marginally higher than last year.
The South African Citrus Growers Association (CGA) announced at its grower conference in Port Elizabeth that close to 137 million cartons will be exported this year to no less than 100 countries.
UK tariffs applies to apples – according to Eurofruit
The zeroing of tariffs could also have a significant impact on the UK’s apple and pear imports.
At present, apples and pears imported into the UK from the Southern Hemisphere face a higher tariff between 1 August and 31 December, a regime that protects the EU’s own considerable production.
For those importers in the UK who do bring in apples after 1 August, sourcing varieties like Pink Lady, Jazz and Braeburn from the Southern Hemisphere, the UK government’s plan represents a potential liberalisation of trade.
Elsewhere, the abolition of import tariffs could mean that products currently sourced in large volumes from other EU countries, such as oranges, tomatoes or berries, face greater competition from non-EU countries, particularly in the Mediterranean.
California citrus shipments take a hit – says Eurofruit Newsline
Citrus growers feel the physical heat of summer weather alongside the metaphorical heat of the Trump presidency
The 2018-19 California navel orange season is barely at its halfway point, but the industry is already anticipating it will be one of the more difficult campaigns in years.
Coming into the deal, the San Joaquin Valley growers knew they had a challenge on their hands: fruit in the orchards was abnormally small. This year, however, an additional factor that has nothing to do with Mother Nature threatens to complicate the current season all the more: politics.
Ever since Donald Trump came into office with his trade warfare agenda, American agriculture has borne much of the fallout. China has been the president’s primary target from the outset and the Asian nation quickly retaliated by drastically ramping up import duties on an array of US agricultural and industrial products. A year ago, Chinese tariffs on California fresh oranges stood at 11 per cent; today it’s 51 per cent. Washington apples, Northwest cherries and California table grapes all have been saddled with similarly ratcheted-up duties.
South African Parliament may be asked to ratify new deal with the UK
While the British Parliament will decide the nature that Brexit will take, South Africa’s Parliament is likely to be also called to arms to ratify a new trade agreement which will set up the basis for future trade with the UK.
The South African Parliament may be called on to meet urgently to ratify a new trade agreement between the UK and the Southern African Customs Union plus Mozambique (SACU+M). The governments of the SACU+M countries have been negotiating an agreement with the UK to ensure trade continuity upon the UK’s exit from the EU. This agreement will largely be a replication of the Customs Unions Economic Partnership Agreement (EPA) with the EU.
As part of the EU customs union, the UK has been a party to all EU trade agreements, and therefore the trade of goods between South Africa and the UK has until now taken place under the conditions set in the EU–SACU+M Economic Partnership Agreement (EU EPA). The EU EPA, which came into force in 2016, provides duty free and preferential access for a large amount of Southern African goods into the EU market, and thus also into the UK market.
Uncertainty around land reform eroding investor confidence — Agbiz
Land reform in South Africa will not take place at the expense of growth and job creation – the two most important issues on President Cyril Ramaphosa’s agenda.
Speaking at the third CGA Citrus Summit held in Port Elizabeth on the topic ‘Business Confidence in Agriculture’, agricultural economist Wandile Sihlobo said land reform in South Africa needs to be based on sound economic principles. A parliamentary committee chaired by the National Assembly House Chairperson Thoko Didiza is currently discussing the nature and extent of these changes. All South Africans will be involved and have the opportunity to speak out if “something does not sit well” with them about the land reform process, Sihlobo said.
Land reform, specifically expropriation without compensation has created uncertainty among land and property owners in South Africa as well as internationally, weighing on business and investor confidence. Sihlobo pointed out that the South African economy, including the agricultural sector, can only show sound growth if trust and confidence are restored, and then followed by solid structural reforms.