Required Report - public distribution

**Date:** 10/11/2005

**GAIN Report Number:** SF5037

SF0000

**South Africa, Republic of**

**Dried Fruit**

**Annual**

**2005**

**Approved by:**

![](media/image1.wmf)Scott Reynolds

U.S. Embassy

**Prepared by:**

Patricia Mabiletsa

**Report Highlights:**

South Africa's 2005 raisin production is expected to decrease 23% from
last year because of a drought and late rains which caused a decline in
total production of grapes used for drying. Thompson seedless raisins
and unbleached sultanas experienced significant decreases of about 29%
and 65% respectively.

Includes PSD Changes: Yes

Includes Trade Matrix: Yes

Unscheduled Report

Pretoria \[SF1\]

\[SF\]

Table of Contents

[Executive Summary 3](#executive-summary)

[Production 3](#production)

[Production Subcategory 4](#production-subcategory)

[Consumption 4](#consumption)

[Consumption Subcategory 4](#consumption-subcategory)

[Trade 5](#trade)

[Trade Subcategory 6](#trade-subcategory)

[Policy 7](#policy)

[Policy Subcategory 7](#policy-subcategory)

[Marketing 7](#marketing)

# Executive Summary

South Africa's 2005 raisin production is expected to decrease 23% from
last year because of a drought and late rains which caused a decline in
total production of grapes used for drying. Thompson seedless raisins
and unbleached sultanas experienced significant decreases of about 29%
and 65% respectively. .

Also, reports are that many South Africa's grape producers are facing
financial hardship and bankruptcy because of bad weather that damaged
fresh production and reduced exports, resulting in increasing number of
farms on sale.

In October 2005, US \$1 = R6.50

# Production

Background

The Western Cape Province, because of its specific climate and natural
resources, is ideally suited for high quality grape production for both
raisins and the fresh markets. The Sultana variety is the most important
grape used for drying. About 93% of South Africa's area planted to
sultanas (Thompson) is situated around the Orange River area. Average
annual production of raisins and currants is about 45,000 MT.

In 2003/4, South Africa had 1,200 raisin producers, with farmer revenue
at US \$ 33.3 million.

2004/5 Production

In 2004/5, the area planted to a wide range of grape varieties for
drying totaled 15,000 Ha. Production and exports from the Orange River
area were both affected by bad weather in 2004/5. More grapes were dried
because of the impact of drought on Sultanas that are produced for the
fresh markets. The season experienced the worst situation with poor
production of a lower quality, in turn affecting prices.

2005/6 Production

In 2005, the Western Cape had a \'normal\' long cold and wet winter. In
June 2005, most parts of the area had good rains that are expected to
fill some dams. Only the Worcester area did not receive normal rainfall,
although the irrigation dams in the region improved from last year. The
Department of Water Affairs statistics indicate that the major dams
supplying water to the Franschhoek, Paarl, Wellington, Olifants River,
Worcester and Robertson areas are in good shape.\
\
The amount of cold exposed to the vines kept them dormant enough to
allow proper rest and budding. Initial indications are uniform budding
of early ripening varieties, which is a good start for the growing
season. 2005/6 production is therefore expected to return to normal.

## Production Subcategory

+------------+-----+--------+------+--------+-------+---------+------+
| South      |     |        |      |        |       |         |      |
| Africa,    |     |        |      |        |       |         |      |
| Republic   |     |        |      |        |       |         |      |
| of         |     |        |      |        |       |         |      |
|            |     |        |      |        |       |         |      |
| ####       |     |        |      |        |       |         |      |
| ## Raisins |     |        |      |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
|            | **  | **Rev  | **20 | **Esti | **2   | **For   | **U  |
|            | 200 | ised** | 03** | mate** | 004** | ecast** | OM** |
|            | 2** |        |      |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
|            | **U | **Post | **   | **     | *     | *       |      |
|            | SDA | Esti   | USDA | Post** | *USDA | *Post** |      |
|            | Of  | mate** | Offi |        | Off   |         |      |
|            | fic |        | cial | **Esti | icial | **Est   |      |
|            | ial | **\[N  | \    | mate** | \[Ol  | imate** |      |
|            | \[O | ew\]** | [Old |        | d\]** |         |      |
|            | ld\ |        | \]** | **\[N  |       | **\[    |      |
|            | ]** |        |      | ew\]** |       | New\]** |      |
+------------+-----+--------+------+--------+-------+---------+------+
| Market     |     | 0      |      | 0      |       | 01/2005 | MM/  |
| Year Begin |     | 1/2003 |      | 1/2004 |       |         | YYYY |
+------------+-----+--------+------+--------+-------+---------+------+
| Area       | 12  | 12300  | 1    | 15000  | 12350 | 15000   | (HA) |
| Planted    | 300 |        | 2350 |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
| Area       | 11  | 9740   | 1    | 10640  | 10640 | 11000   | (HA) |
| Harvested  | 400 |        | 1450 |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
| Beginning  | 4   | 6098   | 2051 | 1668   | 5251  | 4401    | (MT) |
| Stocks     | 598 |        |      |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
| Production | 34  | 36727  | 4    | 39516  | 36720 | 28386   | (MT) |
|            | 953 |        | 0000 |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
| Imports    | 200 | 162    | 200  | 864    | 800   | 900     | (MT) |
+------------+-----+--------+------+--------+-------+---------+------+
| **TOTAL    | **3 | **4    | *    | **4    | **42  | **      | **(M |
| SUPPLY**   | 975 | 2987** | *422 | 2048** | 771** | 33687** | T)** |
|            | 1** |        | 51** |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
| Exports    | 28  | 34519  | 3    | 27647  | 33000 | 25000   | (MT) |
|            | 000 |        | 4953 |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
| Domestic   | 9   | 6800   | 2047 | 10000  | 8396  | 7000    | (MT) |
| C          | 700 |        |      |        |       |         |      |
| onsumption |     |        |      |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
| Ending     | 2   | 1668   | 5251 | 4401   | 1375  | 1687    | (MT) |
| Stocks     | 051 |        |      |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+
| **TOTAL    | **3 | **4    | *    | **4    | **42  | **      | **(M |
| DIST       | 975 | 2987** | *422 | 2048** | 771** | 33687** | T)** |
| RIBUTION** | 1** |        | 51** |        |       |         |      |
+------------+-----+--------+------+--------+-------+---------+------+

# Consumption

South Africa's annual domestic consumption of raisins averages at about
10,000 MT depending on the yield size and production quality. In 2004/5,
domestic consumption is expected at 30% below annual average because of
a lower total production.

## 

## Consumption Subcategory

+-----------------------+-----------------------+-----------------------+
| ## South Africa       |                       |                       |
| 's Average real produ |                       |                       |
| cer/wholesale Prices  |                       |                       |
| for raisins (US\$/MT) |                       |                       |
+-----------------------+-----------------------+-----------------------+
| ## Year  {#year-1}    | ## Raisins            | #                     |
|                       |                       | # Unbleached Sultanas |
+-----------------------+-----------------------+-----------------------+
| ## 2001/02            | ## 507.94             | ## 449.21             |
+-----------------------+-----------------------+-----------------------+
| ## 2002/03            | ## 568.25             | ## 766.67             |
+-----------------------+-----------------------+-----------------------+
| ## 2003/04            | ## 414.29             | ## 677.78             |
+-----------------------+-----------------------+-----------------------+

Source: NDA

# Trade

2004/5

South Africa's 2004/5 imports of raisins is expected to reach about 900
MT, which is a 4% increase, while exports are expected to decrease by
10% from last year because of a decline in total production of grapes
used for drying resulting from a drought and late rains.

2003/4

In 2004, total raisin exports decreased 20% from a year earlier because
of drought that reduced production. Major export destinations remained
Canada, U.K., Germany, Netherlands, and France. However, exports
decreased by 14% to Canada, by 34% to the U.K., by 23% to Germany, by
10% for France and increased by 10% to the Netherlands.

Exports to the U.S. also decreased by 49% to reach 642 MT.

In 2004 raisin imports increased significantly to amount to 864 MT from
162 MT in 2003 because of a lower local production that could not
satisfy demand. Major suppliers were Iran --at market share of 72.3%,
Turkey -- at market share of 9.4%, Chile -- at market share of 7.4%, and
France -- at market share of 0.8%. The Netherlands (3.9%) and Italy
became new entrants last year, and took over market share from France at
3.9% and 1.2% respectively.

IMPORT REQUIREMENTS FOR RAISINS

Import control for agricultural related products is managed by the
National Department of Agriculture. All imported goods are subject to an
import permit, accessible at a cost of US \$8.96 at the National
Department of Agriculture's National Plant Protection Organization. The
website is [Http://www.nda.agric.za](http://www.nda.agric.za/)

Other specific food import regulations like HACCP, MRL, and
Preservatives and Anti-Oxidant for raisins are regulated under the Food,
Cosmetics and Disinfectant Act (Act 54 of 1972) of the National
Department of Health. The website is
[Http://www.doh.gov.za](http://www.doh.gov.za/)

Imported goods for home consumption need to pay the value for customs
duty, plus any additional duty, plus VAT, which is 10% to the value of
the goods. Importers who are registered vendors may claim for VAT
reimbursement from Inland Revenue. The Inland Revenue will on the
otherhand authorize the Department of Customs and Excise to refund VAT.

## Trade Subcategory

+------------------+-----------+-------------------------+-----------+
| South Africa,    |           |                         |           |
| Republic of      |           |                         |           |
|                  |           |                         |           |
| Raisins          |           |                         |           |
+------------------+-----------+-------------------------+-----------+
| **Time Period**  | **        | **Units:**              | **MT**    |
|                  | Jan-Dec** |                         |           |
+------------------+-----------+-------------------------+-----------+
| **Imports for:** | **2003**  |                         | **2004**  |
+------------------+-----------+-------------------------+-----------+
| U.S.             | 36        | U.S.                    | 43        |
+------------------+-----------+-------------------------+-----------+
| Others           |           | Others                  |           |
+------------------+-----------+-------------------------+-----------+
| Iran             | 49        | Iran                    | 625       |
+------------------+-----------+-------------------------+-----------+
| Chile            | 42        | Turkey                  | 81        |
+------------------+-----------+-------------------------+-----------+
| Turkey           | 19        | Chile                   | 64        |
+------------------+-----------+-------------------------+-----------+
| France           | 15        | Netherlands             | 34        |
+------------------+-----------+-------------------------+-----------+
|                  |           | Italy                   | 10        |
+------------------+-----------+-------------------------+-----------+
|                  |           | France                  | 7         |
+------------------+-----------+-------------------------+-----------+
| Total for Others | 125       |                         | 821       |
+------------------+-----------+-------------------------+-----------+
| Others not       | 1         |                         | 0         |
| Listed           |           |                         |           |
+------------------+-----------+-------------------------+-----------+
| **Grand Total**  | **162**   |                         | **864**   |
+------------------+-----------+-------------------------+-----------+

Source: WTA

+---------------------+------------+---------------------+------------+
| South Africa,       |            |                     |            |
| Republic of         |            |                     |            |
|                     |            |                     |            |
| Raisins             |            |                     |            |
+---------------------+------------+---------------------+------------+
| **Time Period**     | *          | **Units:**          | **MT**     |
|                     | *Jan-Dec** |                     |            |
+---------------------+------------+---------------------+------------+
| **Exports for:**    | **2003**   |                     | **2004**   |
+---------------------+------------+---------------------+------------+
| U.S.                | 1,264      | U.S.                | 642        |
+---------------------+------------+---------------------+------------+
| Others              |            | Others              |            |
+---------------------+------------+---------------------+------------+
| Canada              | 8,988      | Canada              | 7,960      |
+---------------------+------------+---------------------+------------+
| U.K.                | 6,034      | U.K.                | 4,074      |
+---------------------+------------+---------------------+------------+
| Germany             | 4,961      | Germany             | 3,830      |
+---------------------+------------+---------------------+------------+
| France              | 3,341      | Netherlands         | 3,337      |
+---------------------+------------+---------------------+------------+
| Netherlands         | 3,033      | France              | 2,997      |
+---------------------+------------+---------------------+------------+
| New Zealand         | 1,057      | Switzerland         | 764        |
+---------------------+------------+---------------------+------------+
| Japan               | 715        | Japan               | 711        |
+---------------------+------------+---------------------+------------+
| Switzerland         | 651        | Hong Kong           | 530        |
+---------------------+------------+---------------------+------------+
| Sweden              | 592        | New Zealand         | 497        |
+---------------------+------------+---------------------+------------+
| Norway              | 460        | Sweden              | 473        |
+---------------------+------------+---------------------+------------+
| Total for Others    | 29832      |                     | 25173      |
+---------------------+------------+---------------------+------------+
| Others not Listed   | 3,423      |                     | 1,832      |
+---------------------+------------+---------------------+------------+
| **Grand Total**     | **34519**  |                     | **27647**  |
+---------------------+------------+---------------------+------------+

Source: WTA

# Policy

# 

The dried fruit industry is working in line with the aims of the
Agricultural Sector Plan (2001).

Other raisin industry implements the agricultural Black Economic
Empowerment (AGRIBEE) through mentorship and training. The industry
reports to have assisted a group of small-scale producers at
Eksteenskruil in Upington to expand their businesses to exporting under
the logo, 'Fair Trade' in 2004.

# 

The grape and raisin industry also plans to establish a strategic
partnership with the government, especially for dealing with issues like
market access.

# Policy Subcategory

The South African Customs Union --US FTA resumed on September 29, 2005
in Botswana. Main issues under discussions included industrial tariffs,
tariffs amendments, Intellectual Property Rights, and government
procurements. Issues scheduled for discussion in the next round are
agriculture and the textile industries. Meetings are scheduled for every
eight (8) weeks and are expected to conclude towards the end of next
year.

The FTA is expected to lock in the benefits of AGOA currently enjoyed by
South Africa and other SACU countries.

# Marketing

The industry plans a worldwide marketing campaign for South African
raisins, using the promotional slogans: ' providing the world with an
exceptionally healthy and nutritious diet' and ' The finest and high
quality raisins, a great source of natural energy that is year round
available'.

##