South African citrus is valued globally for its high quality. This is also the case in the US, to which we have been exporting more and more citrus in past few years.
Exports to that country, which favours oranges, mandarins and grapefruit, almost doubled from 60,000 tonnes in 2020 to 112,594 tonnes last year, bringing in R1.6bn in export revenue and supporting thousands of jobs.
This impressive progress is in large part due to the African Growth and Opportunity Act (Agoa), which provides preferential market access to a wide range of African products, including South African citrus. The act ensures the latter isn’t subject to US tariffs. Therefore, local growers receive an enormous boost, giving them a competitive edge in the US market.
And we need this edge. South Africa has to compete with other southern hemisphere countries, such as Peru and Chile, for shelf space during summer in the US. These countries already have advantages. Their citrus also enters the US duty-free and due to shorter transit times, they enjoy lower costs throughout the supply chain.
Agoa is not a trade agreement. It is an act that was passed by the US Congress in 2000. This leaves South Africa more exposed, because traditional trade agreements can be negotiated in a way that they are more difficult to dissolve, but that is not the case with Agoa.
Some economists suggest that if South Africa is removed from Agoa, the impact on overall trade will be small. This argument does not acknowledge the risks the agricultural sector, citrus specifically, will face if beneficial trade arrangements with the US end. These risks are quantifiable.
If we are removed from Agoa, citrus will suffer. More than R1.5bn in export revenue will be threatened and thousands of rural jobs will be affected.
Local growers are expected to produce an additional 45-million 15kg cartons over the next five years, potentially growing to 260-million by 2030. This will sustain a further 100,000 jobs and generate an additional R20bn in annual revenue, bringing the sector’s contribution to the economy to 240,000 jobs and R50bn.
Because of phytosanitary restrictions, only citrus from the Western and Northern Cape is shipped to the US. The industry in these provinces sustains an estimated 35,000 jobs at farm level, with additional employment right through the supply chain. An additional 20,000 jobs in the US are also linked to the exports.
The focus of the Citrus Growers' Association of Southern Africa (CGA) is on supporting growers, thereby contributing to job creation and economic revenue. Our interest is the economic welfare of those in the citrus production chain. We want to keep exporting to the US under the most favourable conditions possible and expand that market so other provinces can export to the country.
The CGA has prioritised pushing for the conclusion of a long-delayed final rule, now before US officials, that will expand access to the US by allowing growers from other South African provinces to export their fruit to ports such as Philadelphia, Newark and Savannah. This will create more jobs and export revenue for South Africa and the US.
In spite of the challenges the citrus industry is facing, including load-shedding, a dysfunctional rail network, decaying roads and congested ports, the hard work of our growers has ensured the outlook is good.
Local growers are expected to produce an additional 45-million 15kg cartons over the next five years, potentially growing to 260-million by 2030. This will sustain a further 100,000 jobs and generate an additional R20bn in annual revenue, bringing the sector’s contribution to the economy to 240,000 jobs and R50bn.
However, critical to achieving this is ensuring there are enough overseas markets to absorb the increase in exports. Losing the US as a key market, which offers great potential for expansion, would be a blow to the industry and the livelihoods it supports.
Greater market access should always be a priority, not just when it comes to the possibilities the US offers us, but in general. We have had great market-expansion successes in the past.
After productive co-operation with the department of agriculture, a new market for the export of citrus to Thailand was established in 2012.
Two years ago the Bureau of Plant Industry in the Philippines signed a final agreement that allowed South African citrus to be imported. That year, a revised Chinese protocol guaranteed an important market and secured R325m in new revenue and 800 jobs.
The CGA has also worked alongside the department of trade, industry and co-operation to search out growth opportunities, with great results.
It has always been and still is the CGA's objective to advance economic growth and job creation, and to ensure consumers worldwide enjoy safe, nutritious, high-quality citrus.
• Chadwick is the CEO of the Citrus Growers' Association of Southern Africa
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