Demand expected strong for South African citrus - The Packer

Demand expected strong for South African citrus

05/10/2010 02:09:22 PM
Andy Nelson

The South African citrus industry is expected to ship 14% more fruit this year than last year, and industry officials and importers say they’ll have no problem finding enough demand to match those higher volumes.

In the past 10 years, Fort Pierce, Fla.-based DNE World Fruit Sales never received any South African clementines in May, said Tom Cowan, South African citrus category manager.

This year DNE expects to do just that, with some early shipments coming in the third week of May. However, Cowan says he’s not worried about product entering a full pipeline.

“We should fit right in, from what retailers are telling us,” he said. “California should be done with mandarins.”

Clementines continue to gain favor in the U.S., Cowan said.

“They’ve taken away navel business in the winter, and we see it being a big item for the summer citrus program,” he said. “It’s a very popular piece of fruit.”

South African navels should be in high demand as well, with little chance of Chile, whose navels were allowed in the U.S. beginning last year, dampening demand, Cowan said.

Both countries shipped about 1.5 million boxes last summer, he said, and this summer the joint total could be in the 3.5 million to 4 million box range.

“I think there will be some offers out there for retailers to offer customers,” he said. “One thing retailers like about summer citrus is it’s added dollars they didn’t have before. And citrus can take a full mark-up. It’s a profitable item.”

South African shippers and importers are a lot less nervous about Chile entering the navel deal than they were last year, said David Mixon, senior vice president and chief marketing officer of Vero Beach, Fla.-based Seald Sweet International.

“Last year everybody was very, very concerned,” he said. “There wasn’t a good handle on the the amount of fruit the market could bear. But it proved to be very achievable for everyone,” Mixon said.

Peru and Australia along with South Africa and Chile among those enjoying good navel demand in 2009, he said.

Things should only get better, Mixon said.

“I think this market is just seeing the tip of the iceberg of what can be utilized,” he said.

Montreal-based Fisher Capespan Inc. also is optimistic heading into the summer of 2010, despite having Chile in the mix again, said Marc Solomon, the company’s president and chief executive officer.

“Based on last year’s experience, South African growers are confident they can grow (the size of the North American deal),” he said. “Chile has an advantage on the West Coast on freight, but I think they can co-exist and both do well.”

It all comes back to quality, said Joretha Guldenhuys, chief executive officer of the Citrusdal, South Africa-based Western Cape Citrus Producers Forum.

“The quality of the South African fruit is outstanding year over year and importers, retailers and consumers know that,” she said. “Given the demand of the consumer for quality product, we have every confidence there will be ongoing and continued growth.”

That should also mean strong market conditions for South African fruit this summer, Geldenhuys said.

“Taste and quality drive demand and the excellent quality of our fruit commands good prices,” she said. “We expect to achieve similar prices to last year.”

The South African industry also is benefiting from an industrywide acceptance of all summer citrus, regardless of where it came from, Geldenhuys said.

“We recently completed market research among national and regional supermarket buyers of summer citrus, and they were unanimous in saying that summer citrus continues to be a growing category,” Geldenhuys said. “We are going to be a part of that growth.”

New competition from Chile, which last summer was given the green light to export navels to the U.S. for the first time, does not overly concern Geldenhuys.

In 2009, Chile shipped about 23,000 tons, according to the Chilean Fresh Fruit Association, Sonoma, Calif.

“We did well in 2009 and expect to continue to do well in this market this year and in coming years,” she said.

“Our navels have built up a great reputation over the more than 10 years we have been shipping to the U.S. for having excellent eating quality. This, coupled with our reputation for being a reliable shipper of superior fruit, will continue to stand us in good stead.”



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