South Africa has seen a very good year as far as citrus exports are concerned but this seems to having a detrimental effect on the supply to the domestic market, especially on oranges.
A procurement manager for one of the main retailers in South Africa, said that despite opening accounts with all major citrus producers over the last few years, he still can't get top quality oranges, in fact they have had no Class I Navels or Valencias for the last eight years.
This is making it very difficult to grow the citrus category which relies on high quality fruit. Navels and Valencias are considered a commodity in South Africa and people will not pay the price which can be achieved when the fruit is exported. Retailers also have to compete against each other on price, which also adds pressure.
"Quality is a very important part of the equation when selling fresh produce," said the procurement manager. "Quality, price, availability are all important, but if you don't get quality right you will not grow the category."
"South African consumers will go to the markets where the citrus is cheaper and there is much more choice, we are now with citrus where we were with tomatoes about 12 -15 years ago, where the big suppliers such as ZZ2 did not want to supply retail, they then changed their strategy and now we have good quality supply, but the average producer only wants to deal with markets and not retail," explains the manager.
Out of season fruit from storage is sold when the quality holds, then they move to imports, but mainly just for soft citrus. The supply of local soft citrus during the season is usually much better quality than oranges.
South Africa is a big exporting country and low quality domestic supply is not limited to oranges. "Fruit suffers from this problem because producers try to export at least 60% of their produce that is just not in our favour as the best quality gets sent out of the country, especially oranges."
The South African consumer, as with many around the world, is leaning towards healthy products. Today's consumers are more educated and want to eat better than their parents did, they really focus on good quality this is why the ZA market is growing exponentially, according to the manager.
Fresh cut is also becoming more popular, and although not one of the most profitable lines it is definitely essential.
