JOHANNESBURG – Agriculture Minister Thoko Didiza makes a compelling case for the potential of the agricultural sector as a means of achieving economic growth, unlocking job creation and bringing about transformation in the economy.
However, her analysis has a missing ingredient to unlock this potential – market access. The blueberry sector provides a useful illustration.
Blueberries have been hailed worldwide as a “superfood” with myriad health benefits, sending global demand for the fruit rocketing. With the National Treasury calling for a R6 billion boost in agricultural exports over the next 10 years, now is the time to capitalise on our booming blueberry industry.
One just needs to look at those markets where we already have access to see how well blueberry exports perform. In our UK access to the market the growth of the blueberry sales already far exceeds all other fruit.
Last year fruit sales as a whole in the UK grew by 3.6 percent, while blueberries as a category grew by 13.4 percent.
South African berry producers have taken full advantage of the growth in that market and it's reflected in the growth of South African blueberry exports. In 2018, 54 percent of South Africa's blueberry exports were destined for the UK.
It is largely thanks to this export growth that the number of workers employed in the industry increased from around 1 000 in 2014 to more than 8 000 this year. This number is expected to reach 14 000 by 2023.
Unlike the UK, we do not have access to key markets in the Far East. To understand why this is an opportunity missed, you need only look at how the berry market there is growing.
There is a growing snacking culture in the Eastern markets and blueberries are becoming a favourite among the snack options.
Blueberries are so popular in China that the Chilean exporters have started selling blueberries in cinemas as an alternative to popcorn. It's called “Blue Pop”.
Between 2013 and 2017, China's imports of blueberries grew from 2 482 tons to 12 327 tons. And while we watch from the sidelines, Chile, and Peru especially, are winning big in that market.
Blueberries were introduced as a crop for the first time in Peru in 2007. Blueberry production grew on average 206 percent a year between 2012 and 2018. The rise in the value of Peru's blueberry exports has been astronomical: its exports grew from R1.2 million in 2012 to a staggering R5.6bn in 2018.
Peru is currently the second largest exporter of blueberries to the Chinese market after Chile. Peru's blueberry exports are expected to exceed 110 000 tons this year. They could surpass Chile as the world's largest blueberry exporter by 2020, by some estimates this year.
Frankly speaking, Chile and Peru are eating South Africa's lunch. More importantly, they are creating the jobs that we should be creating here. As the South African Berry Producers Association we estimate that with access to the Chinese market we could increase the projected number of jobs in the blueberry industry by 2023 from 14 000 to 26 000.
The truth is that we should be competing toe-to-toe with Peru and Chile for market share in China. South Africa has key advantages over its South American competitors: South Africa's blueberries can be grown virtually anywhere in the country; we produce blueberry varieties that are in high demand in China; and, crucially, South Africa has shorter transit times to China than our South American competitors.
At the moment, the growth of the Chinese blueberry market is benefiting Chile and Peru most, with market share of 51 percent and 42 percent, respectively.
Market access would put South Africa's hat in the ring to take our share of this growing market and create thousands of jobs in the process.
The benefits of the blueberry industry's growth are far-reaching and particularly favourable for workers. On wages, for example, permanent blueberry workers earn 26 percent more than the average farmworker and seasonal workers earn 13 percent above average. The blueberry industry spends more for labour per hectare than any fruit in South Africa.
Blueberries are harvested at precisely the time of year when few numbers of seasonal farm labourers are required by other fruit industries, allowing seasonal workers to have more job opportunities throughout the year. And because berries can be grown virtually anywhere in the country, we can target high unemployment areas with the expansion of substrate production.
Finally, because of the technical and skilled nature of the work involved in blueberry production, there are plenty of opportunities for workers to build careers for themselves, including a growing demand for horticulturists.
So, what is stopping South Africa from realising this potential? The simple answer is the delay in the processing of export protocols.
For example, South Africa applied to export apples to China in 2003. The protocol was only finalised in 2015. Pears were applied for at the same time and still don't have access. They may be waiting until 2020. At this rate, blueberries protocols will be finalised in 2045 – a quarter of a century away.
Fortunately, Finance Minister Tito Mboweni has spelled out the solution in the Treasury discussion document:
“To the extent that these departments and agencies experience capacity constraints, it is critical to leverage public-private partnerships to improve market access for exported products.”
The SA Blueberry Producers Association has written to Didiza with an offer to help her department to address the capacity constraints that are delaying market access.
We have also made the point in a comprehensive submission to the Treasury on its economic plan.
By simply speeding up the finalisation of export protocols, we can get more of South Africa's fruit into more key markets. This is what we need to do – in partnership with the government – to boost exports and create thousands of jobs.
Jeán Kotzé is the chairperson of the South African Berry Producers Association.