Required Report - public distribution

**Date:** 12/4/2003

**GAIN Report Number:** SF3041

SF3041

**South Africa, Republic of**

**Avocado**

**Annual**

**2003**

**Approved by:**

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

U.S. Embassy, South Africa

**Prepared by:**

Patricia Mabiletsa

**Report Highlights:**

South Africa\'s FAS 2002, (MY 2003) avocado production, at 84,000 tons,
is estimated to have decreased by 23% compared to the previous season,
mainly due to the alternate bearing nature of the avocado. The fruit
size was also smaller due to high temperatures and insufficient
moisture. Post estimates that the smaller crop led to a 20% decrease in
exports. The 2003 (MY 2004) crop is expected to bounce back to about
100,000 tons. Most exports are destined for Europe, where awareness is
well established, but the industry is considering expanding exports to
Japan and the US.

Includes PSD Changes: Yes

Includes Trade Matrix: Yes

Annual Report

Pretoria \[SF1\]

\[SF\]

# Executive Summary

South Africa's FAS 2002, MY 2003, avocado production is estimated to
have declined about 23% from the previous season because of the
alternating bearing nature of the avocado plants. The fruit size was
also small, as a result of high temperatures and insufficient moisture.
Further problems encountered included sunburn injury, especially for
Hass varieties.

The trade estimate for MY 2003 is that 38,000 Mt. was exported, 35,000
MT of which was destined for Europe. The industry projects an increase
in annual exports of roughly 12,000 Mt. by 2012. More Hass than Green
skins are exported to Europe. The industry expects to continue with
generic promotion in Europe. Locally, fresh produce markets remain major
channels for avocados.

Major challenges for the avocado industry are to expand the processing
industry, to continue with generic promotions both in South Africa and
Europe, to continue to communicate with competitor countries to prevent
unnecessary supply peaks in Europe, and to overcome phytosanitary
barriers that will allow access to new markets. The industry plans to
target the United States as a new market.

The Avocado Growers Association (SAAGA) was formed in the late 1960's to
promote the interests of avocado farmers in South Africa. SAAGA
collects, collates, and disseminate information for members; encourages
coordination of export and local marketing; facilitates research; and
promotes avocado consumption both locally and abroad. SAAGA is the
largest organization in the subtropical fruit sector and consists of
voluntary membership of about 450 growers, cooperators, and exporters.
The Association produces about 90% of the total crop, and serves
production areas from Louis Trichardt in the Limpopo Province, Tzaneen,
Burgershall White River and Nelspruit, Kwazulu Natal, and a small area
of the Western Cape.

The avocado production extends to an area of about 12,000 Ha, with an
annual production capacity of between 85,000 -- 110,000 MT. Future
production is forecast at an annual increase of about 2%. The production
season for South African avocados is between March and October. During
this period, South Africa's major competitors within the European
markets are Spain, Peru, Kenya, and Israel.

South Africa's producers of sub-tropical fruits are not the largest
suppliers of export fruit in the world, although they dominate certain
markets at given times of the year.

![](media/image2.wmf)

Production

South Africa's MY 2003 avocado production decreased about 23% from the
previous season because of alternating bearing nature of the avocado
trees. The fruit size has been small, because of high temperatures and
insufficient soil moisture contents. Sunburn injury was widespread this
season, especially on the Hass variety. South Africa's new Hass
plantings totaled 100,000 trees in 2003.

# Consumption

Annually, about 50% of the total subtropical fruits are sold in the
local markets. In MY 2003, the fresh produce markets, which are major
channels for supply of local avocados, remained firm and paid reasonable
returns. As a result of the smaller crop the local market was
undersupplied. The increase in processing consumption shown is the
result of a rise in demand for fresh avocados for processing of oil and
guacamole.

## 

MY 2003 avocado prices in local markets were about R1,700/Mt. The table
below indicates annual average prices for period 1992-2001.

AVOCADO PRICES IN LOCAL FRESH PRODUCE MARKETS ( 1992-2001)

<table>
<colgroup>
<col style="width: 10%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 8%" />
<col style="width: 8%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 9%" />
</colgroup>
<tbody>
<tr class="odd">
<td>YEAR</td>
<td>1992</td>
<td>1993</td>
<td>1994</td>
<td>1995</td>
<td>1996</td>
<td>1997</td>
<td>1998</td>
<td>1999</td>
<td>2000</td>
<td>2001</td>
</tr>
<tr class="even">
<td><p>PRICES</p>
<p>R/TON</p></td>
<td>1,800</td>
<td>2,200</td>
<td>1,900</td>
<td>2,600</td>
<td>2,100</td>
<td>2,400</td>
<td>1,900</td>
<td>2,800</td>
<td>2,100</td>
<td>3,100</td>
</tr>
</tbody>
</table>

# Trade

Exports

South Africa's peak exports period starts in July and end in August. The
main destination for exports is the EU. Japan and the United States are
the markets the industry is targeting.

South Africa's avocados have acquired a reputation for good quality,
especially when compared with later fruits from main competitor
countries (Israel, Kenya, Spain, and Peru).

Increased demand for the South African avocados in Europe also reduces
storage costs.

Major challenges for the avocado industry include expanding the
processing industry, to continue with generic promotions both in South
Africa and Europe, to continue to communicate with competitor countries
to prevent unnecessary supply peaks in Europe, and to overcome
phytosanitary barriers that will allow access to new markets.

![](media/image3.wmf)

South African MY 2003 avocado exports probably totaled about 38,000 Mt.
of which Europe received the largest share; about 36,000 Mt. South
Africa already exported about 20,000 MT of Green skins and about 14,000
MT of Hass up to the end of August. Usually, more Hass than Green skins
are exported to Europe because of consumer preferences. A larger export
volume by air is predicted for the coming season.

The table below indicates the quantity of South African avocados
exported from January to August 2003:

  ----------------------------------- ----------------- -----------------
  COUNTRIES                           2003              METRIC

  France                              11,227            TONS

  Netherlands                         10,641            TONS

  U.K.                                8,944             TONS

  Germany                             2,094             TONS

  Belgium                             670               TONS

  Denmark                             369               TONS

  Switzerland                         259               TONS

  Spain                               209               TONS

  United Arab Emirates                128               TONS

  TOTAL                               34,541            TONS
  ----------------------------------- ----------------- -----------------

The start of this year's export season was delayed because of inadequate
ripeness of fruit. It also appears that a fair percentage of fruit was
small in size and not readily acceptable in overseas markets. For MY
2004, rough projections for exports are about 23,200 MT for green skins,
and an increase to about 19,600 MT for Hass.

Imports

![](media/image4.wmf)The table below shows the quantity of South African
avocado imports from Jan-August 2003.

  ----------------------- ----------------------- -----------------------
  COUNTRIES               2003                    METRIC

  Zimbabwe                314                     TONS

  Israel                  37                      TONS

  Kenya                   18                      TONS

  TOTAL                   369                     TONS
  ----------------------- ----------------------- -----------------------

# Policy

The South African National Accreditation System (SANAS) accredited the
Perishable Product Export Control Board (PPECB) with the ISO 62 and ISO
65 status in 2002. The status enables PPECB to accredit local firms'
certificates for Hazard Analysis Critical Point (HACCP), Good
Manufacturing Practices (GMP), Good Hygiene Practices (GHP), and Good
Agricultural Practices (GAP), specifically EURO GAP. This follows the
2001's ISO 9001 status and a certificate Agency approval for EURO GAP.
The above follows a growing concern for food handling and consumption
safety by both importing and exporting countries. Certificates serve as
written guarantee to importers, wholesalers and retailers of safe
handling, throughout the production, processing, and distribution chain.

South African food exporters are expected to comply with the new minimum
European Union export standards for food safety and hygiene as also
applied on EU-produced foodstuffs from January 2004. Affected are
producers for all fresh fruit and vegetables, all canned fruit and
vegetables, all frozen fruit and vegetables, dried fruit, groundnuts and
grain, and rooibos and honeybush tea. For more information, visit the
South Africa Department of Agriculture's

Web site at
[www.nda.agric.za/docs/plantquality/default.htm](http://www.nda.agric.za/docs/plantquality/default.htm)

# Marketing

SAAGA's market promotion in the U.K. is well established under the
slogan "Summer Avocados-Fresh from the South African Sun". According to
SAAGA, there is a strong linkage for increased European demand for
avocado during South Africa's peak exporting period. Export earnings
from Europe, mainly the UK, increased in 2002 to reach an amount of R200
million because of the well-managed supply to avoid gluts. For more
information, visit SAAGA's website at
[www.avocado.co.za](http://www.avocado.co.za/).

Growers, pack houses and exporters coordinate and manage weekly exports
at regional levels by meeting regularly to study the European market
trends. The Avocado industry and stakeholders established a Marketing
and Promotion Working Group (AMAPWG) to share information on projected
production and weekly shipments to Europe.

European consumers, more so than South Africans, prefer Hass to other
varieties.