Avocado Exports:
The South African Story
Lusito D. Khumalo
GM: Enterprise Development
18 November 2010
Agribusiness Export Awareness Workshop
Cedara College
Pietermaritzburg
Contents
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•
•
•
•
•
•
•
•
•
•
•
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Corporate structure
Background
Research and development
Orchard practices
Disease control
Picking, packing and cooling
Logistical efficiency
EU supply and price
Market development
EU market growth
Accreditation
Emerging farmer development
Conclusion
HM Corporate Structure
Hans Merensky
Foundation
IDC
HM Holdings
Westfalia
HM Timber
Westfalia Group
Hans Merensky
Foundation
Westfalia
HM Timber
Westfalia Fruit
Estates
Bavaria Fruit
Estate
Westfalia Fruit
Products
Westfalia Marketing
South Africa
Westfalia Marketing
Europe
Westfalia Functional Structure
Hans Merensky Holdings (Pty)
Ltd
Westfalia Limited
Westfalia Fruit
Estates (Pty) Ltd
Westfalia Europe
Cooperatief U.A.
Tzaneen Fruit
Packers (Pty) Ltd
Westfalia Marketing
(Pty) Ltd
Westfalia Fruit
Products (Pty) Ltd
Bavaria Fruit
Estate (Pty) Ltd
Agricola
Ayacucho S.A.
Comexa Services
SARL
Westfalia Marketing
UK Ltd
Westfalia Fruit (UK)
Ltd
Westfalia
Marketing BV
Greencell
Limited
Westfalia
Marketing AG
Background
The main cultivars exported from South Africa
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Fuerte
Pinkerton
Hass
Ryan
History
Until the late 1980’s quality of export fruit a major
challenge
• Cold damage
• Grey pulp
• Pulp spot
• Post harvest decay (Antrachnose/stem end rot)
Fruit sensitivity a function of climatical conditions
- South Africa, Mexico, Australia
(Queensland/NSW) and New Zealand similar
Research &
Development
• A number of people contributed to develop
a successful and competitive export
avocado industry through dedicated
research.
• Amongst these were Joe Darvis, Jan
Toerien, Stefan Köhne, Blackie Swarts, Jurg
Bezuidenhout, Guy Whitney, John Bower,
Jonty Cutting, Nigel Wolstenholme, Gawie
Eksteen, Bertie Truter, etc.
• Institutions : Westfalia, University of Natal
and ARC
Orchard practices
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Nitrogen levels
Calcium translocation
Potassium / Nitrogen ratio
Cell wall integrity / browning enzymes
(Poliphenol oxidase)
Disease Control
Pre-harvest
• Copperoxychloride
• Timing of application
• Efficiency of application
Post-harvest
• Omega (Prochloraz / Chronos)
• Westfalia Biocoat ®
Picking
• Soft handling of fruit
• Stem-end dip (Prochloraz / Westfalia Biocoat®)
Tendency towards smaller trees
Pruning / hedge rows
Objective : Limit lenticell damage /
bruising / stemend rot
Packing
• Quality evaluation at intake (picking injuries and
other defects)
• Fruit handling – important principles
- Intake
- Roller speed
- Type of brushes
- Limit falls and rolling of fruit
- Measurements – electronic apple (Visier)
Objective : Limit lenticell damage and bruising
Cooling
• Cold room design
Limit moisture loss
• Carton design
-
Ventilation
-
Strength
Logistical Efficiency
• Controlled atmosphere (CA) - most common
post harvest treatment for SA shipments
• 1-MCP (Smartfresh™) technology is starting to
play a more important role as an alternative
• Advanced Fresh Air Management (AFAM plus)
might also be a consideration for the future.
Temperature
management
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Temperature regime
Fruit maturity / cultivar
Time / temperature interaction
Fruit age
Market dynamics
– impact on fruit quality
• Undersupplied market – forgiving of quality
• Oversupplied market – very competitive
2006-2008 Actual, & 2009 Estimated RYAN Volumes (4kg cartons / week)
80000
100000
90000
70000
80000
60000
Cartons (4 kg)
50000
60000
40000
50000
40000
30000
30000
20000
20000
10000
10000
0
0
23
24
25
26
27
28
29
30
31
32
33
34
35
36
Picking Week
2009 Volumes
2006
2007
2008
37
38
39
40
Cartons (4kg)
70000
EU Hass Supply 2004 to 2009
1200
'000 cartons
1000
800
600
400
200
0
1
2
3
4
5
6
7
8
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52
Week on Market
2004
2005
2006
2007
2008
2009
Hass price track record
12
10
Euro per carton
8
6
4
2
0
1
3
5
7
9
11
13
15
17
19
21
23
25
27
29
31
33
35
37
39
41
43
week on market
2005
2006
2007
2008
2009
45
47
49
51
53
SA Exports
• Consolidation within the industry
• Grower driven export companies
• Forward integration into markets
Market development
• Selling more in existing markets
- Create bigger awareness for avocados as a
health product
- Availability of Ripe & Ready to eat
avocados
• Develop new markets
- Israel efforts in East Block
countries
European market growth
Europe - yearly supply by producing countries
(000’ Tons. 1.9 – 31.8)
1996/7
1997/8
1998/9
43
35
24
34
25 11 25 140
63
19 9
52
40
13 10 32
120
179
2004/5
46
60
14 11
43
175
38
45
11 16
34
145
45
60
13 11
40
170
10 145
27
35
20 1.4 16
35
26
63
16 15 30 13 168
16
17
54
45
15
47
2005/6
28
1999/0
2000/1
2001/2
2002/3
2003/4
58
2006/7
2007/8
2008/9*
54
27
32
55
56
20
56
10
11
18
36
15
10
27
9
16
12
41
28
10
50
44
206
200
37
250
34
48
44
230
220
* Projected
Israel
Spain
Mexico
Chile
Kenya
S.Africa
Peru
Market sophistication - Accreditations
Estimated Farm Income per carton for Hass in EU export markets
4kg Carton
Gross in
Euros
Packing
Costs
Transport
to Port
SAAGA
Export
Comm.
Other
Sea freight
(R)
(R)
(R)
(R)
(R)
(R)
5.50
7.50
3.40
0.68
1.00
2.50
10.00 - 11.00
12.10
28.00
8.00
7.50
3.40
0.68
1.00
2.50
10.00 - 11.00
14.80
55.00
(€)
Overseas
costs
(R)
BOF
(R)
Value chain interventions needed by
emerging avocado farmers
- Blackspot
spraying
(BOTT)
Refurbishment
Training
-Commercial
(JV)
Foundation
On-farm
Pack
house
Shareholding
Outsource to
SMMEs
Marketing
Logistics
Methodology
Feb - August 2009
1. Survey of 60 farmers
2. Selection of 15 farmers for
pilot study
4. Conduct a value chain
analysis of traditional
supply chain
5. Selection of development
approach: Sustainable
Livelihoods
Spraying began in Sept ‘09 to Jan’10
BUSINESS MODEL
LEGAL STRUCTURE
WOOLWORTHS ENTERPRISE
DEVELOPMENT FUND (EDF)
1. Tri-Party Agreement
WESTFALIA
ESTATE
(WFE)
FARMERS
3. Packing Agreement
PACKHOUSE
WESTFALIA
MARKETING (SA)
Accredited
2. Marketing Agreement
WESTFALIA
MARKETING (SA)
WFM (SA)
Project Logo
Results
FROM
ORCHARD
TO MAIN
ROAD
FROM MAIN
ROAD TO
COLLECTION
POINT
FROM
COLLECTION
POINT TO
PACKHOUSE
Conclusion
• A combination of scientific research and the
application of commercial principles
• A determination by growers to pull together
and weather the storms in unison
• The unwavering support by government
departments and associated agencies
Thank-you
Contact Details
Name
Position
Contact
Number
E-mail
Louis Vorster
Managing Director
083 702 8639
015 309 0053
louisv@hansmerensky.co.za
Johan Rebel
Executive Manager
082 898 7736
015 309 0046
johanr@hansmerensky.co.za
Lusito Khumalo
GM: Enterprise Development
Manager
073 717 3958
015 309 0069
lusitok@hansmerensky.co.za
Gary Haylett
Strategy and Projects
Manager
083 611 6413
011 381 5750
garyh@hansmerensky.co.za