As reported in FPJ, the South African avocado season kicked off this year amid unusually heavy rains, resulting in a delayed start for major volumes. On top of the natural adversity, with shipping setbacks and the unfortunate coincidence of various public holidays, April proved rather trying for a significant number of players. However, now that orders are firmly back on track, upon reflection, the situation was not as dire as many had feared.
“There were delays in the northern regions due to the rain and bad weather, but we actually had some crops come on a bit early,” says Robbie Taylor, exports director at HL Hall & Sons. “We were slightly ahead on Pinkerton. There was a bit of a problem with the oil and moisture content early on but that’s all fine now.”
The late rains sparked concern over quality issues but all reports have been very encouraging to date and the single most distinguishable mark of this year’s Hass harvest is the high incidence of small-sized fruit, compared with last year’s fairly large campaign, with many 16s, 18s, 24s and even smaller fruit about. As such, while volumes may be reasonably high, packing time is significantly increased and exporters are actually sending fewer cartons overall.
According to Afrupro Exporter Ltd’s Wiedse Kruger, the export market has been favourable so far this season although he emphasises that the critical period for South African exporters is only just upon them. “We have seen an increase in volumes in the market which, up to now have been handled quite well but now, from week 23 to 30, we are getting into the difficult period for Hass, when we are competing with the summer fruit from the continent,” he says.
Peru has also steadily upped its stake in Europe, having announced plans to send eight million cartons of Hass this year, against South Africa’s 10mt. However, the small sizing of South Africa’s crop should hold it in good stead with the UK and Scandinavian countries, leaving Peru to dominate elsewhere with its larger fruit.
Co-operation with such competitors has been pushed to the top of the agenda, according to Derek Donkin, general manager of the South African Avocado Growers’ Association (SAAGA), but due to reasons beyond his control, the proceedings have been put on hold this year. “We are trying to develop the market with generic promotion and tried to do a joined-up promotion with the Peruvians in France, but sadly it hasn’t taken off this year,” he says. “But we will investigate trying to work with them again next year. Avocados fit in well with any health and well-being programme but we have to establish a process for working together to keep the message going.”
Financial support is a significant drawback for avocados and other subtropical fruit, according to Jaco Marais, managing director at Katopé Subtropicals RSA. “Subtropical account for only three per cent of the fruit coming out of South Africa, of which avocados account for two per cent, so availability of funding for market development is a problem,” he says. “Germany is under-performing in terms of consumption, Poland and the Balkan countries are starting to pick up after only a couple of years, but we could develop the market faster if we were involved in more generic promotion. From a South African perspective the industry is too small to do it by itself.”
While Katopé markets an array of fresh products, its name - the zulu word for avocado - denotes the significance placed on the product, and Marais emphasises the visible hikes in demand for avocado, especially in the UK, make it much more exciting to work than some other products, such as citrus, mangoes, or apples, where the product is already well-established worldwide, or entering decline. At the same time, however, he suggests the natural conditions of South Africa do not work in the favour of avo growers. “The climate is poor, which makes farming difficult, therefore there is a pressure to be good,” he says. “In Peru, the avos are grown in the desert where there is no rain and therefore no threat from disease and the industry costs are much higher here than in Peru or Spain.”
One of the greatest threats facing avocado plantations worldwide is a soil borne pathogen known as Phytophthora cinnamomi, the organism causing root rot, which has the potential to eradicate entire orchards. In order to find ways of overcoming this challenge for the whole industry, Westfalia, home to South Africa’s most advanced R&D facility for avocado and mango, devotes much of its time and manpower to the cause.One of the most recent developments in this field has been the release by Westfalia of the root-rot tolerant rootstock known as Dusa. This rootstock is widely regarded innearly all avocado growing nations as being as the best performing rootstock available to date in terms of yield and root rot tolerance.As well as supplying South African avocado producerswith avocado varieties grafted onto the Dusa rootstockfrom its own nursery for the past five years, strategic global alliances have also been set up whereby nurseries in California, Spain, Australia and New Zealand have been licensed to sell the Dusa rootstock in those countries. According to Stefan Köhne, general manager of the company’s R&D division, Westfalia Technological Services, Dusa has also been used experimentally in Chile.
A general feeling prevailing across the industry is that South Africa’s competitive edge has been slowly eroding in the wake of rocketing advancements made by its competitors. This has forced South Africa to take stock of its attributes. “There are so many players now and anyone can export avocados so you have to ask yourself what differentiates you from everyone else?” Marais says. “That is why a big part of our system is very much focused on accreditation schemes, as well as quality and of course consistency, which has almost become more important.”
Donkin agrees, adding that the rise of allegiance to EurepGAP and other industry-wide certifications has urged producers to focus on more integrated methods of pest control. “EurepGAP dictates that growers spray crops responsibly,” he says. “We don’t have a huge range of chemicals available anyway but more and more people are trying to go the natural route.”
Organic production is also seeing significant growth. With 350 hectares out of its total 1250ha devoted to organic avos, Westfalia is South Africa’s biggest organic producer by far. Katopé Subtropicals has also invested in organic production. Accounting for just four per cent of the company’s total avo offer, volumes are still small, but Katopé was in fact at the forefront of the trend, responsible for the country’s first organic avo exports, Marais explains. The company has been working with its sole organic grower, Don Taylor for 10 years and while progress has been stilted in some respects, volumes are never the less increasing. “Don was trying to do it for four years before we started working with him but back then organics didn’t exist,” he says. “We were led by Don, working totally from scratch. It was pioneering work. Four years ago we were doing 3,000 cartons, now we are doing 70,000 and in five years’ time we will be doing 120,000, but it is a much slower ride than conventional production.”
Avocados are already much lower yielding than other fresh products, but without the possibility of inoculating trees against disease, organic producers are even more restrictive. Taylor harvests around 40-50 per cent less than conventional plantations. He has already lost huge plots to phytophthora and even reverted to conventional production at one point, but for him, organics is part of an all-encompassing drive to be self-sustainable and he has persevered despite such setbacks.
After five minutes in Taylor’s company it is easy to see why Katopé’s organic growth has been restricted to date, since cutting corners or getting rich quick are not on his immediate horizon. On the contrary, Taylor rejects all material excesses, choosing to live by a philosophy of balance: everything taken out of the soil must be replaced. To this effect, he rears cattle organically to contribute to his organic compost, and if his trees are performing well, he pretty much leaves them to their own devices, encouraging weeds, or ‘companion plants’, and wildlife to flourish in their midst. He has conducted experiments on his soils to identify the microbes present on his particular land in order to ensure that everything he puts into the soil is compatible with what should be there naturally and has been working on an alternative treatment to copper, based on a by product of bees’ honey-making activity.
Taylor has even experimented with biodynamics - respecting the land’s natural temporal cycle. “I try and pick in the morning because that is when the earth is breathing out but plants close down in the afternoon. However, you do get more lenticel damage in the morning so you can’t be too strict about it,” he says.
South African organic producers are beset with problems on an industry scale, as well, according to Taylor. “There is no money for R&D in organics, no Soil Association like in the UK,” he says. “I like the structured rules of the SA but there is no organisation here. There are about 200 certified organic farms and about 11 certifying bodies. We don’t have our own legislation so we use European rules.” The industry also suffers from logistical set-backs since the demand for organic fruit is almost exclusively limited to Cape Town and Johannesburg, and even the latter of these is barely viable, given the small quantities its market can take.
By contrast, the export situation is far more rewarding and Taylor admits that compared to his conventional counterparts, he is fortunate in terms of returns. “I tend to oscillate in a certain bracket so that even when prices drop I am still comfortable,” he claims. “I send to niche markets, directly to orders, so I pack the same volumes throughout the season - even when prices collapse I have to keep sending fruit because people are depending on me and I can still work with the lower prices. In fact I wish I had more to send.”
Marais shares this desire, explaining that Katopé’s organic and fairtrade programmes present opposite problems. “The problem with organic is to find enough product for the market, whereas the problem with Fairtrade is finding enough markets,” he says.
The company currently exports 400,000 cartons of Fairtrade avos but only one eighth of these, some 50,000 cartons, actually make it onto supermarket shelves in a recognised Fairtrade format because the market for Fairtrade is still so underdeveloped, he explains. “There is still a lot of growth needed but as of this year we are now allowed to trade with Switzerland,” he says. “It is still early days. Fairtrade avos weren’t available three years back and this is only really our second full season in production. It takes time but the whole aim of Fairtrade is to get a better premium back to the growers. Last year they got R48,000 (£3,780) but I want to triple that.”
Donkin believes South Africa’s avocado industry is in fairly good shape these days, after a necessary period of consolidation, which saw the smaller players of 10 years ago opting out of exports altogether. Marais, however, believes the sector is in danger of standing a little too still. “Avocado production is not growing,” he says. “We are still exporting 10m cartons, which I believe is the wrong strategy when the market, in the UK especially, is growing by 12 per cent.” In the wake of land reform, investors, particularly foreign companies, have shown increasing reluctance towards South Africa, he adds.
This staticness is a reflection of the overall agricultural scene, which many say has been neglected of late. “Agriculture has got to be given more attention,” says Halls’ Taylor. “It is not seen as nationally important or a significant contributor to the economy but we have a new minister now and I think that will change.” Like many other sectors, the avocado business has become something of an “old game”, with an inability to recruit any new blood, Taylor suggests. In an attempt to remedy this, Halls has embarked on a mission to fast-track two employees into management positions, while Taylor hopes the bursaries being offered by the local horticultural college will also enhance the sector’s appeal.
Meanwhile, Halls took the opportunity to revamp the image of avocados on the local market six months ago, with the construction of a ripe-and-ready facility. Westfalia has had a stake in this arena for over a decade, and now manages a 12-month supply, thanks to imports from Spain, and between them they cover a large percentage of the retail sector. While Halls caters for Pick and Pay at the lower end of the scale, Westfalia works solely with Woolworths, South Africa’s equivalent of M&S. Ripe and Ready is still a fairly fledgling concept in the industry but a number of other organisations are keen to get involved, including Afrupro, which is in discussions to open a facility in Cape Town.
However, while the local market may look more appealing than it has in previous years, the major exporters are quick to emphasise that this will not detract from their primary focus on exports, to the UK in particular. “Until Japan opens for us there is no real option other than Europe and in the UK we are virtually seeing a pull rather than a push effect, which is very pleasing,” says Marais. Halls’ Taylor agrees that for now the UK is still the hottest prospect. “The market growth in the UK alone is sufficient to take up our growth in planting,” he says. “We don’t want to be reliant on any one country but we do want to be able to supply our major customers. When you think about it, it is not a bad position to be in, really.”
No comments yet