With 130 000 jobs on the line, the Citrus Growers’ Association of Southern Africa (CGA) has pleaded with the government to urgently intervene in the impasse that has led to oranges being prohibited in the European Union.
Justin Chadwick, CEO of CGA, said they have written – out of concern with the 2023 citrus season kicking off – to both ministers of trade and industry Ebrahim Patel and agriculture Thoko Didiza for an update on government interventions on the false coddling moth (FCM) governing the exporting of the country’s oranges.
Urgent intervention needed
Chadwick said should the impasse not be resolved, the industry is set to lose R500 million and around 20% of oranges produced won’t be shipped to Europe this season.
“Despite months of consultations between both parties at a World Trade Organisation (WTO) level, it appears very limited progress has been achieved to avert the crisis that will face the industry should growers have to implement these new regulations.
“With the industry facing several serious headwinds over the past two years, including soaring farm input and shipping costs, power outages, and operational issues at ports, the 2023 season will be a make-or-break one for many growers.
Chadwick said if new regulations are to be implemented when the season kicks off, it could be the final nail in the coffin for many growers as well as the thousands of jobs they support.
A matter of days left
“We need urgent action before the end of this month if we hope to avert the impending crisis facing the sector,” Justin said. “This should include taking the next step, which is calling for the establishment of a WTO panel to adjudicate on the matter.”
Chadwick said it is critical that the national government draws a line in the sand within the next two weeks, to put a stop to this looming crisis threatening the No 1 agricultural exporter in our country.
“The CGA remains committed to continuing working with national government on this critical matter in order to ensure the short-term and long-term survival of our industry,” Chadwick said.
Hitting hard on exporter pockets
Fruit exporter and managing director at Riypm, Uzair Essack, told Food For Mzansi that the impact is huge on exporters like himself and many farmers.
Currently, Essack is loading soft citrus for Lithuania in Europe. And instead of being able to send it from the farm to the cold store, and then load it under a commercial contract at the cold store and pay an amount of R 350 per pallet, Essack has to work differently.
“I now must load it under the Europe regime temperature at the cold store which cost more money – R550 per pallet. Now imagine how many pallets are being sent to Europe from South Africa and you paying an extra R200 per pallet, it’s a big cost,” he explained.
Essack said with load shedding continuing, cold stores are struggling to maintain the cold protocol because of a longer period of power cuts. This could increase costs for growers and exporters as the cold store would use more diesel.
He said looking for alternative markets is not easy, however, he is working very hard on getting new markets. Essack has his eyes set on the Far East where the market for citrus is growing rapidly.
EU remains a key market for SA
Citrus farmer and exporter in the Eastern Cape, Khaya Katoo, said he worries that soon other products will also be affected. Currently, the prohibition is only on oranges.
Katoo said looking for alternative markets at this stage would cost farmers a lot of money. Starting a season without knowing where the produce will go, is stressful to the growers and a threat to job creation, he explained.
According to Katoo, many growers are concerned with the regulations which could lead to many livelihoods being destitute.
“The European Union market pays better, and it is sustainable, so if we have to look for new markets at this stage it means money [going] out to establish that market and income shrinking,’ he said.
“This has affected the industry very negatively and it is a big market for the country and growers. Once the industry is affected, everyone directly or indirectly gets affected, so we are really feeling the pinch and not sure what the future holds.”
The spokesperson for the department of agriculture, Reggie Ngcobo, confirmed to Food For Mzansi that the letter from CGA had reached the minister, however, he said once the update on the regulations has been shared with CGA, the information will be made public.
The office of the trade and industry minister did not respond to media inquiries sent by Food For Mzansi at the time of publication.
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