Most products in the exotics portfolio have shown growth over the last three months, as the January health kick helped to rekindle consumer interest in the category.
According to Kantar Worldpanel data, volume growth has been good, with the pineapple, melon, kiwifruit and fig sub-categories benefiting from more shoppers and increased purchasing frequency.
However, there has been a decline in spend driven by overall lower prices, according to Kantar, and this has especially affected passionfruit, mangoes and kiwifruit.
“Sales in exotics have shown strong volume growth in the last three-month period but relatively flat value, as sales have been driven by strong promotional support,” explains Ken Reed, category manager (fruit) at Wealmoor Ltd. “This has, however, resulted in more consumers coming back into the category, which should help the category for the rest of the year.”
Mangoes and pomegranates both traded well over the New Year period. “Mango was helped by excellent eating quality and good volume availability from the Peruvian season in the first two months of the year,” says Reed. “We are currently in the middle of switching seasons on mangoes, moving from Peru to Costa Rica. Fruit quality has been very good from both regions and we fully expect that to remain the case.”
Pomegranates also performed well, with a significant number of new consumers entering the market on the back of significant investment in the category in PR and advertising.
“Wealmoor ran a very successful PR/marketing campaign for the POM Wonderful product from November to February,” says Reed. “Significant coverage was achieved across a number of food and lifestyle media, featuring the product and focusing on its versatility of use.”
Indian supplier Kay Bee Exports has had what ceo Kaushal Khakhar describes as “a very unusual pomegranate season until now”. Pomegranate supplies have been only 20 per cent of normal volumes, which has caused a dramatic increase in prices - especially with the European market also undersupplied and prices at record highs, Khakhar adds.
Kay Bee Exports is also on the verge of its Alphonso and Kesar mango seasons. “The initial volumes look low but will quickly pick up from the second week of April,” explains Khakhar.
In terms of ethnic and exotic vegetables, sales have been “normal” in the last three months, according to insiders.
Kay Bee Exports has been supplying okra from its own farms for the last few months now to UK retailers. “Supplies are excellent because of favourable weather over the last couple of months,” says Khakhar.
The summer is traditionally a downtime for the exotics sector, as home-grown berries and European stonefruit come on stream and tend to grab the limelight. However, the key issue for the category over the next few months will be product availability, according to Reed.
“A number of product categories are being affected by greater extremes in weather - for example, high temperatures in Brazil and overcast weather in South Africa - and this is affecting crop availability,” he says. “This factor and the relative weakness of sterling as a currency will impact on the market, as costs are likely to rise and may limit availability on a number of products during the summer.”
The weakening sterling is certainly having a significant impact on the exotics category in terms of margins and export volumes.
“If not for the adverse currency movements, we would have had at least 10 per cent higher volumes in the last three months,” says Khakhar. “The UK is just coming out of the downturn. Before the downturn, the exotics category was recording the highest growth. We expect the high growth trajectory to restart as soon as the economy normalises.”
Next on the agenda for Kay Bee Exports is diversifying into newer products, including more mainstream offers such as baby corn and peas. “We hope to be able to innovate on new products and packaging in the coming months and capitalise on the growth opportunities,” adds Khakhar.
SOUTH AFRICAN POMEGRANATE GROWERS JOIN FORCES TO BOOST EXPORTS
A national Pomegranate Producers’ Association was recently established in South Africa. This young industry has developed from scratch and as various pomegranate producer groups established plantings independently, there was an urgent need for a
co-ordinated approach in the form of an inclusive industry body to represent South African pomegranate producers.
“The process began in November last year and we have almost completed this,” explains Jack Wittles, chairman of the Pomegranate Producers’ Association.
The association is to represent grower interests at numerous levels across the board, including the establishment of quality standards for pomegranate exports and protocols surrounding agrochemical applications for pest control.
“As producers, we need to establish the most effective methods of pest control and to ensure that these measures are acceptable to our markets,” explains Jorrie Mulder, board member of the association. He also serves on the association’s technical committee, which will co-operate with the government and the relevant agrochemical specialists to establish the required standardised crop protection measures.
Initially, establishing this new crop involved a degree of expensive trial and error regarding plant material, variety choices, ideal climate and other production challenges. The industry has matured considerably since then and there are currently between 1,200 and 1,400 planted hectares. These grow in a range of climatic conditions throughout the country. As much of these plantings are expected to start bearing significantly in the next two years, the establishment of a representative body had become a necessity.
This producer association is an important milestone in the development of the South African pomegranate industry and the association’s function is likely to expand to collect industry information such as production and market information.
South African production is largely aimed at markets in the EU, the Far East and the Middle East and growers are producing soft-seeded varieties favoured in these markets. These include the Indian varieties Bagwa, Arakta, Ruby and Ganesh, the Spanish variety Mollar and the Israeli varieties Wonderful, Ako and Herskowitz. The fruit is mostly marketed whole as fresh fruit or as extracted arils and there is also much scope for the development of a juice industry.
Colors Fruit Exports is one of South Africa’s leading fresh produce export companies and exports whole fruit to the EU. “This season marks our first commercial exports,” says Anita Krüger of the research and development division at Colors Fruit. “Our first shipments for the season have arrived in the markets and have been very well received.”
Wittles and Mulder both produce pomegranates for sale as whole fruit and their core market is the UK. Their varieties are all Israeli selections and the original plant material is imported to South Africa from Israel. The production period is from mid-March to early May.
A group of producers in the Western Cape have formed the Premier Pomegranate Producers’ Co-operative (PPP), to spread the cost of aril extraction. Extracting the arils is a tricky process, as the delicate outer membranes of the arils need to remain intact to retain their juice. In the past, this was done manually, but the increased production has made it necessary to mechanise.
Fan Olivier is one of the co-operative members and after much research he made a substantial investment in the industry last year, importing a huge, highly sophisticated aril extraction machine manufactured with Israeli technology. The PPP group has now established a large, state-of-the-art aril extraction facility.
“The demand for arils has remained good throughout the recession, largely due to the product’s powerful health benefits,” explains Olivier.
During the 2009 harvest season, three to four tonnes of arils were shipped to the UK weekly starting in April, packed in punnets or in bulk food grade bags. The facility has spare capacity in anticipation for the rapid increase in production over the next few years.
South Africa’s main markets for extracted arils are the UK as well as continental Europe and as production increases, it seems likely that South African shippers will also export to the Middle East and the Far East.
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