Though these difficulties stem from the Covid pandemic rather than squabbles over regulations, they could also result in scenarios similar to those of thousands of boxes of oranges spoiling in containers stranded at European ports.
Local avocado growers garner better profits from exports than domestic sales, and SA avocado farming has become largely an export business.
Export volumes in 2021 were similar to those of 2020, with SA sending about 16-million 4kg cartons to overseas markets. In 2020, overall SA exports of avocados were valued at nearly $77m, with about 65%-70% of the annual crop exported.
Though 2021 was not the best season for local avocados, with about the same amount of production tonnage as in 2020 and less than in 2018, the local “green gold” has nonetheless been scoring overseas, and predominantly in the EU.
SA exporters have made gains in the EU and UK, which represent the deep, affluent markets for local exporters. The main importing countries of SA avocados are the Netherlands, France, Spain and the UK. SA is the second-biggest avocado supplier to the Netherlands with an 11% share, and also to the larger European market with a 14% share.
However, less than 10% of all avos sold in the EU and UK markets come from SA. There are larger Spanish, Israeli and US exporters and marketers, representing strenuous competition which means, in turn, that SA exporters cannot afford to drop the ball.
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The US market is served by its own Californian product, but mostly from Mexico. SA exports only small volumes to Africa (in which Kenya is a big player), the Middle East and Hong Kong.
A healthy slice of export revenue emanates from SA companies buying avos in foreign markets and selling them into other overseas markets
In 2021, prices of SA Fuerte (pear-shaped) avocados neared record levels in Europe. A 4kg carton was sold for between €6.2 and €7.3, with consumers apparently willing to pay a premium for a stable supply. During the same year, the prices of Hass (bumpy skin) avocados from SA in Europe were 40% lower than the Fuerte. A 4kg carton was sold for between €3.4 and €4.
SA’s larger exporters are, among others, Westfalia Fruit, ZZ2 and Halls. Perhaps not so well known is that a healthy slice of export revenue emanates from SA companies buying avos in foreign markets and selling them into other overseas markets — from, say, South American countries into EU countries — acting, in other words, as middlemen, or “marketers” as they prefer to call themselves.
Westfalia and Halls are the two biggest SA avo marketers in the EU⁄UK. Halls’ main port operations are in Rotterdam and Marseilles (where the fruit arrives in the EU); its biggest processing plant is in Paris, the second-largest in Rotterdam, then come Marseilles and Málaga (Spain). The French are by far the biggest European consumers of avocados.
But SA avo growers⁄exporters⁄marketers face big logistics problems at major European ports. Over the past month serious congestion problems, reduced labour availability and long dwell times have been reported at Le Havre and Fos-Sur-Mer in France as well as in Antwerp, Rotterdam, Hamburg and Southampton. In other parts of Europe, including Poland, Denmark, Sweden and Finland, limited trucking has continued to hamper the movement of goods.
Avos are shipped in climate-controlled containers before they ripen, and take about 30 days to mature. Serious delays at ports and other delivery constraints can result in undesirable green mush rather than the lovely ripe avos consumers like to put on their toast.
Another problem for farmers is climate change. Drought and hail have a big impact on production, and too much rain promotes fungus growth on trees.
According to the Observatory of Economic Complexity, over the past two decades — ever since the avocado attained superfood status because of its acknowledged health benefits — total world trade has rocketed, totalling $6.6bn in 2019. However, prices on international markets — depending on supply vs demand — are not always stable. Given that avocado production depends on the time of year, with production moving from the northern to the southern hemispheres during the year, European per capita consumption obviously varies accordingly.
By way of comparison with EU prices, according to 2022 data from the Joburg Market, the largest fresh produce market in SA, the average price of a 10kg carton of Fuerte avocados is R81 and a similar carton of Hass avocados is R60. The average price of a 4kg carton of Fuerte avocados ranges from R20 to R77, while a similar carton of Hass avocados ranges from R65 to R80.
