SA citrus industry to mitigate impact of Russia-Ukraine war on supply

SOUTH AFRICA – The citrus sector of South Africa is strategizing ways of mitigating the delay in exported fruits to Russia that has been witnessed since its invasion of Ukraine.

Major European ports used by the South African fresh produce industry in Russia are heavily congested as all containers need to be scanned.

This results in fresh fruit from South Africa, in some cases, remaining in transit for up to 90 days – when it usually takes around 24 days.

The Russian market accounts for approximately 7 to 10% of total South African citrus exports annually, with 11.2 million (15kg) cartons of fruit having been exported to the country in 2021.

With no fresh produce having been shipped to the region over the past few weeks by most countries, early shipments of lemons destined for the Russian market have been impacted.

Should this situation continue, when the export season officially kicks off in April, other varietals such as grapefruit and soft citrus will also be impacted.

To this end, the Citrus Growers’ Association of Southern Africa (CGA) is working closely with exporters, government and other stakeholders across the citrus value chain to mitigate the impact that the conflict has had on South Africa’s local citrus growers and exporters.

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This includes further increases in input costs for growers and exporters which have arose as a result of the conflict.

With 14% of global fertiliser exports currently being stuck in Russia and the price of oil and gas continuing to climb as a result of the current conflict, it is expected even a further increase in fertiliser, fuel and agrochemical prices, which will place a further strain on growers.

Over the past year, there has been an increase in a number of input costs, including fertiliser prices almost doubling and agrochemical prices increasing on average by 50%.

Rising fuel prices and freight costs, which increased by approximately 30-40% in 2021, have also severely squeezed growers’ profit margins.

The current situation, with a sharp increase in the price of crude oil, will increase shipping costs further.

A lingering concern is that South Africa could suffer from an oversupply and a build-up of stock, which could impact early season supplies.

Meanwhile, although South African exports to Ukraine are still developing, the conflict still puts a hold on exports to that country.

Exporters had started to build some momentum in direct exports to Ukraine, reports Bizcommunity.

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