Hannes de Waal, the newly-appointed chairperson of the Citrus Growers’ Association of Southern Africa (CGA), says his first priority is to address some of the risks threatening the sustainability and profitability of the local citrus industry.
This includes ageing infrastructure which, De Waal believes, could lead to massive job and financial losses. The high levels of congestion and delays at Mzansi’s main ports, mostly due to machinery breakdowns caused by worn-out infrastructure, have disrupted operations and increased costs for most fruit exporters.
De Waal also tells Food For Mzansi that the citrus industry plans on increasing its global footprint.
Tiisetso Manoko: Congrats on your recent appointment. The first 100 days is said to be key to business success. What are some of the immediate tasks you’re undertaking to safeguard the citrus industry?
Hannes de Waal: In terms of growth and inclusivity, we will allocate a large portion of our attention towards the transformation initiatives taking place across our industry, to ensure that our sector continues to reap rewards for all South Africans in an inclusive manner. This will be addressed through key initiatives driven by the CGA Grower Development Company as well as programmes such as the Orange Heart fruit drive and Citrus Academy bursaries.
Citrus growers are highly frustrated by the many delays at ports across the country. Do you have any big plans to address the port woes?
The CGA has called for immediate intervention at the Durban and Cape Town ports to ensure citrus reaches key markets on time in 2022. We have urgently called on government to prioritise the sufficient funds to be allocated to Transnet to invest in critical equipment and personnel to ensure an immediate improvement in performance and productivity at the ports’ container terminals.
Particularly Durban Pier 1, Durban Pier 2 and Cape Town container terminals. It is critical that vessels move to and from the ports to global markets with constancy, regularity and reliably in 2022 – an essential part of the success in supplying fruit to receivers and maximising industry returns.
These steps must be prioritised and realised as a matter of urgency in the months to come. Not only to avoid a repeat of the risks and issues we faced in 2021, but also to prevent shipping lines increasingly bypassing South African ports, which not only robs growers of the opportunity to access all markets but also puts the entire economy at risk.
What are the other most pressing challenges currently faced by the citrus industry?
Our local citrus industry continues to face several serious challenges including the global shipping crisis, stringent additional phytosanitary measures by the European Union that are costing the industry more than R4 billion annually, as well as serious operational challenges at South African ports.
The global shipping crisis has resulted in logistics prices soaring, while the slow turnover of ships continues to cause major uncertainty in shipping schedules and backlogs at ports across the world.
As a result, there was a dramatic increase in logistics prices last year. On average freight costs increased by approximately 30% to 40% when compared to 2020, and a global shortage of containers meant cargo had to be stored at ports and across the supply chain, for longer and at a greater cost in 2021.
We are working closely with exporters, government, and other stakeholders across the citrus value chain to mitigate the impact that the Russian invasion of Ukraine has had on our local citrus growers and exporters.
This includes fruit destined for Russia being blocked, delays in fruit getting to the market as well as further increases in input costs for growers and exporters because of the conflict.
Increasing crop volumes have the potential to create more jobs and increase export revenue for the country, it could also negatively impact grower returns, if the industry fails to both retain and expand key markets.
Ageing infrastructure must certainly also be greatly frustrating…
We will remain committed to working with government and stakeholders across the value chain to address issues affecting the ports, so that our industry is able to continue exporting quality fruit across the globe and remain a key contributor to the economy and jobs.
Furthermore, we will continue to work with government and all other stakeholders in a collective effort to help ensure the continued profitability and sustainability of our local citrus industry, which sustains over 120 000 jobs and generates R30 billion in export revenue for the country.
What are some of the CGA’s key projects for the year ahead?
Retaining, obtaining, and expanding access in key markets is critical for the sustainability of growing the citrus industry and it is remaining a major contributor to rural jobs and export revenue.
Key focus areas for 2022 include engaging a few countries and stakeholders with key focus of growing the industry and creating sustainable jobs for the future.
In the United States, we plan on obtaining wider access for local growers outside of the Western Cape and Northern Cape. In India, obtaining the necessary clearance for in-transit cold treatment of fruit to the country.
In Vietnam, the ratification of a new protocol between South Africa and Vietnam so the local industry can gain re-entry into this market after having lost access in 2013.
In Japan, obtaining wider access for soft citrus through the relaxation of current strict market conditions, while Korea and Thailand agreeing to a shorter and less severe cold-treatment process, which will enable wider access in these markets.
In terms of the European Union, despite the industry remaining committed to striving for full compliance with current EU phytosanitary rules and has implemented a world class risk management system to achieve this, the CGA will continue to highlight the negative impact of draconian and unnecessary measures on the sustainability and profitability of the local industry.
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