Afrupro - August 2019

AFRUPRO

AFRUPRO

The Fruit

of a Generation PRODUCTION: William Denstone

From seemingly nowhere, avocados have risen to become one of the inarguable favourite fruits of the 21st century. Afrupro is directly involved in the whole supply chain, from the orchard to the final product in the customer’s hands, supplying quality fruit in a responsible manner for a sustainable future. MD Simon Tattersall took us through how Afrupro is increasing volume to meet unprecedented demand, while retaining the quality and focus on sustainability for which it is famed.

2 / www.enterprise-africa.net

INDUSTRY FOCUS: AGRICULTURE

//

Afrupro Marketing (Pty) Ltd is one of South Africa’s top subtropical fruit grower marketing companies, responsible for marketing all grades of locally grown avocados and litchis both in South Africa and internationally. The company’s offices are centrally located in Tzaneen, where it coordinates the logistical and packing programmes between its avocado and litchi growers, as well as the various packing and market activities.

Simon Tattersall, Afrupro Managing Director, has been with the company since October 2016 and reveals that it was a bid for fruit freedom that brought about its inception. “It was essentially a couple of farmers who wanted to break away from the more conventional, larger marketers and export companies,” he outlines.

“Having been part of one of the major companies, they decided to form their own to gain greater transparency, not only in the returns they were receiving but also in terms of the cost structure and what they were paying for.

“We are based in what is probably the South African hub of avos and litchis,” Tattersall states, with Afrupro

4 / www.enterprise-africa.net

in pole position in the South African industry which supplies around 13% of Europe’s total avocados. The avocado boom has been all the more welcome given the relative downturn for Afrupro’s other main line of produce (avos are the main line of produce, not sure what this sentence means?), Tattersall explains, as it means that there has been no resulting slack in overall results.

“We’ve actually seen quite a decline in litchi demand,” he says. “I think there are a couple of small issues with exporting the fruit, but also with Madagascar being so much the leading producer it is very difficult for the South African market to compete.”

THE RISE OF THE AVO While the consumption of avocados dates back more than 10,000 years, the unprecedented popularity they currently enjoy makes the fruit seems like an exciting, fresh discovery. Since the turn of the millennium global production has more than doubled - from 2.71 million tons per year to 5.92 mtpy.

The boom has coincided with consumers becoming more health conscious and informed, with avocados

// WE ARE BASED IN PROBABLY THE SOUTH AFRICAN HUB OF AVOCADOS AND LITCHIS // quickly becoming the dominant superfood due to their high content of unsaturated fats and antioxidants.

“From good old guacamole and smashed avocado on toast to avocado ice cream and even avocado chocolate cake,” writes Medium Food, “our society has become obsessed with this proclaimed superfood.” Simon Tattersall agrees that the convergence of factors, but not least the avocado’s multipurpose nature, has been key to its charming a generation.

“The fact that it is a super fruit, and a healthy snack, as well as its versatility has really helped to see the avocado’s popularity explode in these last few years,” he outlines. “People like the fact that you can put it on toast, or in a salad, or even on a pizza. Aside from its health properties, the range of applications this one food has seen demand soar, and continue to grow.”

Derek Donkin, CEO of the South African Avocado Growers Association, also explained that the growth in the local industry was a result of increasing appreciation across the world of the nutritional benefits of avocados and the diverse ways in which they can be used. “The healthiness of the fruit, its uniqueness and the worldwide trend towards healthy eating has been very positive for the industry,” he said.

“Avocados can be used in all sorts of diets: Banting, vegan and ordinary.”

South Africa exports about twothirds of its average annual production of 90,000 tons. Commercial plantings of the fruit in the country have grown by 1000 ha a year and land under cultivation for avocado production is estimated at 17,500 ha by the South African Avocado Growers Association.

NATIONWIDE LEADERS IN THE TRANSPORT OF FRESH PRODUCE

Premium Trucking is family business which had one truck when we established the company in 2004, the fleet has since been built up with Reefer and Tautliner vehicles. The fleet of Reefer trucks have been inspected by PPECB to comply with their quality certification and cold chain management of perishable food products.

We specialize in Fruit and Vegetable transport across the country to all different fresh produce markets. We are committed to excellent service delivery to all our clients and ensure all loads are delivered as requested by customers. www.premiumtrucking.co.za | logistics@premiumtrucking.co.za 083 310 6374 | 083 252 7015 Plot 534 (R71 road), Broederstroomdrift, Tzaneen

INDUSTRY FOCUS: AGRICULTURE

URGENT DEMAND The unprecedented clamouring for avocados has meant that key players like Afrupro are having to work harder than ever to fulfil demand, and expected trends are being bucked daily. “It’s quite unusual to fly out fruit this time of the year,” commented Brenda Greyvensteyn, commercial manager at Afrupro Marketing, as a shortage gripped the European market in mid-July.

The giant crops experienced last year meant that more customers than ever had the opportunity to taste the fruit. This inevitably brought about the current appetite, and Afrupro’s only regret will be that its stocks are not even more abundant.

The avocado market has become a seller’s game due to a relative scarcity of product: the current crop, estimated to weigh in at 14.5 million equivalent 4kg cartons, looks to be 30% down on last year, while Peru, Europe’s largest supplier this time of the year, is itself around 20% down.

“Prices are so good at the moment, really outstanding,” Greyvensteyn

6 / www.enterprise-africa.net

continued. “We have reports of up to 18 euros for a 4kg carton, while we are expecting retail to remain at more conservative levels of around 14 to 16 euros.”

“You’d think the market would’ve matured enough to keep prices stable,” she said, “but last year European consumers could purchase avocados at reasonable prices and even if this year the supply isn’t there, the demand still is.”

Even if some detractors insist that the craze for avocados may finally have reached its peak, this will be immediately negated by the attention it is receiving in the East. In 2017, China imported 32,100 tons of avocado, up from just 32 tons in 2011, and as China’s middle-class grows, the demand for avocado is only set to increase: sales are expected to more than double this year.

“There will be so many opportunities to relieve the pressure from the European market when China opens for avocado exports from South Africa, as China is still such an untapped avocado market,” summarised Greyvensteyn.

YEAR-ROUND SUPPLY Afrupro currently is placed to deliver to markets for the complete South African supply period, which for avocados is weeks 8-39. It is now, however, nearing the stage where all the necessary pieces are in place for a 12-month avocado supply. Apart from a packhouse outside Tzaneen, there are three more in George (Southern Cape), Levubu (Limpopo) and Chipingi (Zimbabwe) “We need to ramp up volumes as fast as possible,” Simon Tattersall underlines. “The major retailers overseas, like Lidl or Kaufland or Rewe, are putting large emphasis on their receivers for a 12-month supply of avocados. We’re aggressively expanding

// ASIDE FROM ITS HEALTH PROPERTIES, THE RANGE OF APPLICATIONS OF THIS ONE FOOD HAS SEEN DEMAND SOAR //

AFRUPRO

our grower base right now.”

South Africa is large enough to provide a number of climatic variations to aid in this quest, as are highpotential neighbouring countries like Mozambique, Zambia and Zimbabwe, all of which can be harnessed in obtaining a continuous avocado supply.

“Now we’re expanding to George,” Tattersall reveals, “which gives us avocados from August to January.

Ofcolaco, meanwhile, is going to come in January and February and area’s in Chipingi will give us more Hass from August to November.”

Climate could have had a very different impact on the Afrupro story, but Tattersall explains that the company

// WE PRIDE OURSELVES ON QUALITY, AND WE CONSISTENTLY ACHIEVE GOOD RETURNS //

was able to weather the droughts of two years ago, and even flourish when so many floundered. “We were very fortunate that 2017 was a down year for all the other avocado producing companies,” he says, “and so even though the drought played a major role the returns we got were very extremely high and offset the losses we would have incurred otherwise.

“The prices were at a real premium that year and translated to a super profit, which helped everyone involved to push through and keep achieving growth.

We’ve also reacted in order to shield ourselves even better in future in case anything like it happens again; we have generators, like all the major players, and we’re also looking at introducing solar power.” – not sure if this as anything to do with the drought but rather issues with eskom?

When asked to round off by telling us how the industry will remain lucrative and continue to grow in size, Tattersall’s response is quite in contrast to what we usually hear: it really is taking care of itself at the moment but new markets need to open soon for South Africa

like the USA and China. “It’s happening naturally, consumption per capita is increasing even in your mature markets” he explains “The biggest barrier to the trade is access to trees; there is a three to four year waiting time, because there is only a limited amount of nurseries which can properly cultivate avocado trees, but once people do get the trees there is clearly a major demand for the product, and we don’t see that slowing anytime soon.

“We pride ourselves on quality, and we consistently achieve good returns,” Tattersall rounds off on what keeps Afrupro among the leading suppliers in this most lucrative of markets. “Because we are still, at this stage, that little bit smaller than some others, we are able to focus heavily on the farmers themselves, and we like to think that this combination puts us up there with the best, and will allow us to keep up with this unstoppable trend.”

WWW.AFRUPRO.CO.ZA

www.enterprise-africa.net / 7

Published by CMB Media Group Chris Bolderstone – General Manager E. chris@cmb-media.co.uk Rouen House, Rouen Rd, Norwich NR1 1RB T. +44 (0) 1603 855 161 E. info@cmb-media.co.uk www.cmb-media.co.uk CMB Media Group does not accept responsibility for omissions or errors. The points of view expressed in articles by attributing writers and/ or in advertisements included in this magazine do not necessarily represent those of the publisher.

Any resemblance to real persons, living or dead is purely coincidental. Whilst every effort is made to ensure the accuracy of the information contained within this magazine, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved.

No part of this publication may be reproduced or stored in a retrievable system or transmitted in any form or by any means without the prior written consent of the publisher. Š CMB Media Group Ltd 2019

AS FEAT UR ED IN

ENTERPRISE AFRICA

AUG UST 2019