MARKETING PROFILE OF LITCHI IN SOUTH AFRICA INTERNATIONAL LITCHI SYMPOSIUM, SOUTH AFRICA FRESH FRUIT: HS 081090 or NTL 08109010 02 ND TO 06 TH DECEMBER 2012 PRESENTER: MR. KM NKAMBULE
PRODUCT OVERVIEW The litchi (Litchi chinensis) is indigenous to the south of China where a subtropical climate prevails The first trees out of the Asian continent were established in the subtropical areas of Hawaii, Florida, California and South Africa in the 19th century. Literature reveals that litchi trees were imported into South Africa from Mauritius in 1876, but some trees had already been noticed in Natal in 1875, which indicates earlier imports. Many different cultivars were established in KwaZulu Natal and later in the Mpumalanga Lowveld and other suitable frost-free areas of the country.
PRODUCT OVERVIEW 7753 tons produced last season France leads importing the fruit thru Netherlands Takes about 11days shipping Madagascar are biggest competitors for RSA China, Tailand and India leading producers Season - end Nov to end Feb
IDENTIFYING THE HS OF THE PRODUCT 1. 4- digit HS:0810- Fruit nes, Fresh 6- digit HS:081090 Fresh fruit 2. NTL code: 08109010 fresh fruits Fresh tamarinds, cashew apples, jackfruit, lychees, sapodillo plums, passion fruit, carambola, pitahaya and other edible fruit granadillas and litchis
PRODUCTION CAPACITY OF SOUTH AFRICA Litchis:1721ha 2247.705 tons of litchi juice 2606 tons exported Limpopo(Tzaneen, Makhado, and Levubu). Annually, Tzaneen contributes an average of 20% to total Litchi production in South Africa. The north and south coasts of Kwazulu Natal have 68 hectares (5%) under litchi cultivation Eastern Cape has 10 hectares (1%) under litchi cultivation.
TON PRODUCTION CAPACITY TOTAL LITCHI PRODUCTION 7000 6000 5000 4000 3000 2000 1000 0 YEAR JUICE TON MUNICIPAL MARKET TON EXPORT TON
R/TON TON LOCAL MARKETING LITCHIS SOLD ON MUNICIPAL MARKET YEAR 5 4 3 2 1 0 18 000 16 000 14 000 12 000 10 000 8 000 6 000 4 000 2 000 0 TON R/TON
WORLD PRODUCTION AND CONSUMPTION Production capacity Spain is the largest producer of fresh fruits producing about 410, 464 tons in 2011claiming 12.4% of the worlds share. Of that, 103,635 was exported to Germany in 2011. Consumption The US, China and Canada are the largest consumers of the product with a 13.1%, 9.2% and 8.3% imports shares in the world in 2011.
WORLD PRODUCTION AND CONSUMPTION 50000 45000 40000 35000 30000 25000 20000 15000 10000 5000 0 Exported value in 2007 Exported value in 2008 Exported value in 2009 Exported value in 2010 Exported value in 2011
SOUTH AFRICA S EXPORT PERFORMANCE
SOUTH AFRICA S EXPORT PERFORMANCE FOR SELECTED PRODUCT RELATIVE TO OTHER PRODUCTS WITHIN ITS SECTOR
TARIFF FACED BY SOUTH AFRICAN EXPORTS OF AVOCADOS WORLD WIDE Market Share Tariffs faced Trade regime SA 17.84% 0% pref. tariff for SA no SA's main competitors in target market Market share Tariffs faced by competitors Trade regime Peru 24.26% 0% pref.tariff for countries that are beneficiaries for sustainable development Tariff advantage for SA (Yes or No) no Chile 16.63% 0% Pref. tariff for Chile Israel 9.86% 0% pref. tariff for GSP countries no no
TARGET MARKET CHARACTERISTICS Import seasonality Importers Exported value Exported value Exported value Exported value Exported value in 2011-Q3 in 2011-Q4 in 2012-Q1 in 2012-Q2 in 2012-Q3 World 2114 7365 8400 7586 1211 Netherlands 1317 2551 4512 3217 50 USA 156 0 0 114 0 Seychelles 131 88 79 86 77 Singapore 122 0 40 150 0 UK 90 1229 1345 1035 376 France 59 1792 1094 467 279 Mozambique 53 58 45 29 29 Malaysia 43 0 139 127 0 Kenya 40 49 153 57 126 Zambia 19 40 61 39 45 Angola 17 40 30 25 39 DRC 10 24 36 40 32 Sources : ITC calculations based on South African revenue services (SARS) statistics.
GROWTH OF SOUTH AFRICAN EXPORTS IN PANORAMA NETHERLANDS Political factors Economical factors Social Factors Technological factors Interest in cooperation among suppliers Non legislative requirements are becoming stricter Netherlands is entirely dependent on imports Per capita consumption is 1kg vs. in the EU 0.5kg per capita Products are mostly Re-exported Consumers are increasingly health-aware Ready-to-eat fruit is a trend Very well developed infrastructure Takes advantage of its geographical position
GROWTH OF SOUTH AFRICAN EXPORTS IN PACKAGING AND LABELLING REGULATIONS NETHERLANDS RSA follows EU legislation regarding the marketing of litchis and has not set any additional requirements. Non-legislative requirements regarding avocados and fruit in general are becoming stricter and obligatory. Codex Alimentarius Standard for litchis Litchis are generally packed in 2 kg boxes. The number of boxes per pallet varies according to the packinghouse.
GROWTH OF SOUTH AFRICAN EXPORTS IN PLACEMENT NETHERLANDS As a distributional centre exporters to the Netherlands are likely to sell mostly to intermediaries (e.g. importers and agents). The Netherlands is an important trader in the European Community as a result it houses the largest number of active importers. Most litchis are sold through the retail chains. These chains are supplied by export cooperation and Dutch importers. The supermarkets in The Netherlands hold 75% of the fresh fruit and vegetable market and often apply their own specific standards. Supermarkets are now more in for direct sales from producing countries as well. The largest Dutch supermarket chains are Ahold, Aldi, Sperwer Holding and Jumbo. There litchis are largely sold in packed pallets by agents or intermediaries in wholesale to retail in which 75% of sales occur. There is stiff competition amongst brands particularly in convenience attributes
USEFUL INFORMATION Afrupro Afrifresh Agrilink Bambanani Fruits Cape Citrus Cape Five Exports Delecta Fruit (Tradegap) Dole Du Toit Vrugte Everseason EXSA FEDFA Freshworld Franschoek Marketing Fruits from Africa Fruits Unlimited Fruitways Goede Hoop Vrugte Green Marketing Halls In Season Marketing Intertrading Fruit Katopé Citrus Komati Fruit LGS Exports Lona Trading Mouton Citrus OREX Patensie Citrus SAFE SAFPRO SAPEX Snofrut Southern Fruit Growers (Betko) Suiderland Plase Sunpride The Fruitman Tomahawk Unifrutti SA Univeg Van der Lans Capefresh Vanguard International WM Global Sourcing South Westfalia Africa (Pty) Ltd WP Fresh XL International Zebra Fresh Fruit
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