South African citrus importers hope to expand markets in the western U.S., but for the most part, they will remain focused on western and midwestern markets in 2012.
How far west U.S. importers can push distribution of South African citrus this summer could depend largely on factors outside their control, said Tom Cowan, South African sales manager for Fort Pierce, Fla.-based DNE World Fruit Sales.
“The cost of transportation to ship fruit from the East Coast port facilities to the West Coast markets will be a factor in expanding into any new markets,” Cowan said. “We anticipate fuel costs will continue to be high this summer.”
The other wild card, Cowan said, is competition from rival imported citrus deals.
“The second factor will be how South Africa citrus stacks up against its competition from Australia, Chile and Peru during the summer months in terms of volumes, quality, prices and exchange rates,” he said.
In 2010, Vero Beach, Fla.-based Seald Sweet International Inc. greatly expanded its West Coast operations, partnering with Dinuba, Calif.-based Fresh Select and moving its western division, Seald Sweet West, into Fresh Select’s 110,000-square-foot packing and cold-storage facility in Dinuba, Calif.
However, the company is not planning significant growth this year in its South African citrus program in the Western U.S., said Kim Flores, marketing manager.
“We had some pretty solid programs on the West Coast last year, and it continues to grow, but the lion’s share of South African citrus is on the East Coast,” Flores said. “Rail or freight programs for South African citrus, from East to West Coast, have been discussed but a definite plan is not yet in place at this time.”
Chile and Peru have an advantage in the summer citrus deals that’s hard for South African to overcome, Flores said.
“Chile and Peru are geographically located to go to either coast,” she said. “South Africa is a totally different story.”
Demand across the country
Expansion into new U.S. markets remains a goal for the South African citrus industry, said Gerrit van der Merwe, chairman of the Citrusdal, South Africa-based Western Cape Citrus Producers Forum.
“As the South African citrus products become better known through marketing initiatives, we are finding a demand for our products across the country,” he said.
Some parts of the country, however, are more accessible than others, van der Merwe said — at least for now.
“We’re working on programs to have the fruit more available in the midwestern regions,” he said. “The western regions are a challenge — not an insurmountable one, but certainly one which merits careful consideration.”
South African citrus programs will expand in the western U.S. only, van der Merwe said, when the industry can be assured that the extra distance and time required doesn’t compromise the fruit’s freshness and quality.
“We will not do it with compromised quality,” he said.
Like Seald Sweet, Montreal-based Fisher Capespan will focus on the East Coast and Midwest this season for distribution of South African citrus crops, said Marc Solomon, senior vice president for South African procurement.
At the same time, the company is by no means ignoring the western U.S.
“We do have demand in the Southwest and even on the West Coast,” Solomon said. “And we’ve developed, over a number of years, an efficient means of servicing those more western markets.”