QUALITY Key for SA’s table-grape sector

The macroeconomic context

Experts like Wandile Sihlobo, chief economist at the Agricultural Business Chamber of South Africa (Agbiz), provided a macroeconomic perspective on both the global and local agricultural sector.
In his presentation, Sihlobo explored the competitiveness, sustainability, and resilience of agribusiness value chains. He also provided insights into the South African government's sector-related views and policies.

The global economy is still under significant pressure due to recent disruptive events, he indicated. The economic shocks caused by the COVID-19 pandemic, deglobalisation, and climate change are some of the factors causing market disruptions.

Recent geopolitics (including Russia's invasion of the Ukraine) and the regionalisation of value chains might cause a structural shift to higher inflation, he said. In addition, there are rising concerns about a global recession.

It is in this context that the local table-grape sector needs to ensure that quality products reach key markets.

However, to unleash the sector's full economic potential, several constraints must be addressed. These issues relate to factors like regulations, infrastructure, land policy, and international markets.

Despite this, the table-grape sector holds excellent growth potential – something that is now acknowledged by the South African ANC-led government and the office of The Presidency.

As part of efforts to unlock the sector's potential, several logistical and infrastructure challenges must be tackled, said Antoinette van Heerden of the Fresh Produce Exporters' Forum of South Africa (FPEF).

She discussed the expected growth trajectory of fruit volumes and the logistic challenges it might pose, including those related to flow rates and capacity. She also shared the FPEF 100-day readiness plan for processing flows and equipment availability in the coming season.

Quality over quantity

In two pre-recorded presentations on the marketing of table grapes in the EU and the UK, Kerstin Meyer and John Pandol confirmed that increased competition from southern hemisphere producers will demand a stronger focus on quality and cold-chain management, as important differentiating factors.

Meyer, from Greenyard Fresh Germany, shared insights into the EU and UK markets. In turn, Pandol, the director of special projects for Pandol Brothers Inc. in the US, discussed the marketing of grapes, including in Northern America.

Last year, South African exporters had many quality-related claims in key export countries, Meyer pointed out. Such claims resulted in producers receiving lower prices which, in turn, negatively affected their profits.

Quality goals should be considered when preparing for packing this season's table grapes, Meyer emphasised.

Other presenters shared their insights and personal experiences around the packing of grapes and its importance in ensuring product quality.

Adri van der Merwe, a consultant, advised growers to work through the cost chain and to save wherever possible, but not on quality measures.

Practical adjustments are needed on farms to ensure quality grapes are produced, packed and shipped. One such adjustment that Van der Merwe mentioned is tracking and preventing breaks in the cold chain. "If you do not measure, you cannot manage," he said. "Use a logger! Check your logger data. Breaks in the cold chain cause increased condensation."

"Dry grapes are happy grapes," he said. "Inspect your fruit after cooling. If the grapes are too wet, increase the liner perforation size and add paper on top of the sulphur dioxide sheet in the carton, until the fruit is dry straight after cooling."

"Do not save on pre-harvest sanitation and Botrytis sprays," he cautioned. "Also, use the correct packaging material. Produce the highest quality grapes at competitive and affordable prices, at the lowest cost."

Tracking table grapes and mining the data

In her presentation, Talita Jansen from the software analytics business AgrigateOne, said digitally tracking grapes throughout the supply chain can help producers focus their energy on section management, decision-making, and changes in the supply chain.

"Tracking grapes along the cold chain can be a strategy to increase your competitiveness in the supply chain and the market," she said.

She added that although the agricultural technology ("agtech") landscape is complex, it is manageable with the right data, tracking tools, and partners.

"We already deal with many supply chain problems. Technology should not be one of them."

"It shouldn't be complex or confusing, but should make your life simpler and easier. It is, therefore, important to invest in the right partners to help digitise your business."

Tracking produce requires administrative processes and related tasks to generate the necessary data, Jansen said. "We need to integrate tracking, logistics, distribution, and sales data holistically. This gives us big data to consider, and to understand all this data takes effort and more work."

Her advice to producers is to include all data and the systems that collate it, in one place as part of their management strategy. "Data on the supply chain is interlinked; therefore, integrate your external and internal data to provide real-time, actionable insights."

Market access and development

The SATI team presented an update on market access and development. They also provided a southern hemisphere view on export volume trends, along with an overview of how it supports research and knowledge transfer in the industry.

In the 2021/22 season, southern hemisphere countries achieved a new export record of 1.5 million tonnes. This translates into an increase of 0.3 million tonnes over a decade. A third (31%) of the world's table-grape supply now comes from the southern hemisphere, according to Jacques Ferreira from SATI.

The world's major fruit export countries are all competing for access to new and emerging markets, including in the East. This season, SATI will continue its market access campaign in China and other Asian destinations, said AJ Griesel, SATI's chief executive officer.

Griesel unpacked the current plans for market expansion to the East and explained what the recent increase in Peruvian table-grape production means for local producers.

Increasingly, SA will have to defend its position in key markets, he said. Our biggest markets for table grapes remain in Europe and Asia.

In terms of volume, SA is one of the top four table-grape producers in the world. We also count amongst the top-six countries, value-wise.

Griesel said inflation and infrastructure pressures necessitate a rethink of some of the market access and development strategies that SATI followed in recent years.

Going forward, he believes the local industry should focus on defending its status as a preferred quality exporter in existing markets (the EU and UK), whilst continuing market development initiatives in the East and North America.

SATI is working hard to maintain and improve existing market access, he indicated. These efforts include gaining an in-depth understanding of phytosanitary and tariff requirements in priority countries.

Three markets that are currently being targeted are the Philippines, South Korea, and Japan. Together, these countries potentially have the market equivalent of two-thirds (66%) of the current volumes exported to the EU and the UK (i.e. 36 million boxes of table grapes, packed in units of 4.5 kg each).

"Where we need to go and defend and preserve our preferred status is in the EU and the UK."

"Defending and preserving the status of our country as a supplier to the UK should be a priority for all of us in the next 12 months," he concluded.