South African citrus growers seek cooperation with other industries to get control of produce shipping and counter steep freight increases
Citrus growers from all over South Africa have asked the country’s Citrus Growers’ Association (CGA) to investigate the feasibility of collaborating with other fruit sectors, to take control of their shipping in order to guarantee some price stability in the future.
The CGA said in a statement that the main challenges raised by growers at the meeting were the significant increases in a number of input costs, including fuel, fertiliser and electricity prices.
“However, their biggest concern was the surge in freight costs over the past year, which have seen some shipping lines hiking their prices by as much as 150 per cent,” the CGA said. ”At these levels, it now costs between 2 and 2.5 times as much to ship the fruit, as it does to produce it over the course of an entire year.”
The other serious challenge raised was the ongoing operational issues at the country’s ports because of aging and out-of-service equipment and staff shortages.
“The perennial productivity problems at Durban port, which handles 60 per cent of the country’s citrus exports, was further compounded by the recent rain and flooding in KwaZulu-Natal,” the Association continued.
“Despite the impressive efforts by Transnet and the eThekwini municipality to ensure the damage to port access roads and the port itself was repaired in record time, it still interrupted the start of the season with many growers having to delay their harvesting and packing of fruit.”
Growers also decided to ask the minister of public enterprises, Pravin Gordhan, who will be delivering his department’s 2022/23 budget speech in Parliament tomorrow, to provide clarity how port problems would be solved.
“It is therefore critical that minister Gordhan provides a progress update on the short-term interventions, announced by President Ramaphosa in his SONA in February, which Transnet was planning to implement including procuring additional equipment and implementing new systems to reduce congestion at the ports.
“It is also crucial that he provides an update on the Request for Qualification (RFQ) published by Transnet earlier this year with regard to introducing Private Sector Participation (PSP) in the Durban Port Container Terminal Pier 2 and Nqura Container Terminal,” said the CGA.
“Critical to the success of this process is for it to include realistic ownership provisions for private operators. We would also appreciate an update on the planned R100bn infrastructure development project at Durban port that was announced last year.”
The CGA did not expand on its ideas to unite all fruit grower and exporters in the fight against rising shipping rates.
This is however the strongest indication so far that fruit growers and exporters see an end to what they view as exorbitant profits announced in recent times by some shipping lines.
