The spread of coronavirus across the globe is sending nervous jitters to exporters.
Earlier in the year, Hortgro Pome Outlook showed a positive optimism of the pome industry which expected a 6% increase of apples (35.7 million cartons) with pears coming down at 3% (16.6 million cartons).
Now all this may come to a bitter acceptance of the reality affecting global agricultural trade.
According to Fresh Plaza, the largest global fruit trade platform said the impact of the coronavirus on China’s apple supply dynamics slowed activity with “traders reportedly slowing their warehouse stockings by almost 10% to 15% relative to normal seasonal trend.”
The National Agricultural Marketing Council Fruit Trade Flow of September 2019 analysis showed that the Far East and Asia enjoyed a lion share of South African apples and pears, accounting for 34% share in South Africa’s fruit exports.
It was still early in the export calendar for both South African apple and pears however, the number was expected to decline provided that COVID-19 subsided. According to the FNB trade data, apple and pears were already showing a decline in exports by 2% and 11% respectively in 2019.
Although South Africa’s agriculture has not yet been severely impacted, the further spread and the potential closure of borders will hurt global trade.
“The logistical challenges associated with delays in ports in Asia, particularly China, have elevated the importance of market diversification in international trade,” said agricultural economist Paul Makube of FNB.
The deciduous industry will be particularly concerned by the delays in trading activity and the growing apple inventory.
According to Makube, it will affect product quality thus forcing warehouses to reduce their stocks by selling at huge discounts.
80 per cent of the apple and pear production in South Africa emanates from the Western Cape with supporting regions of Northern Cape, Eastern Cape, North West, Free State, Mpumalanga and Limpopo Province adding to the number. Hortgro was expected to release its latest outlook on horticulture and deciduous pressured by the outbreak of coronavirus.