MONTHLY MARKET INFORMATION REPORT: VEGETABLES

Review period: October 2015 to October 2016

Issue: 2016/11

IN THIS ISSUE

1. Price and volume trend analysis ( in accordance of the highest to lowest volumes sold during this month)

1.1 Potatoes

1.5 Cabbage

1.9 English Cucumber

1.2 Onions

1.6 Butternut Squash

1.10 Lettuce

1.3 Tomatoes 1.7 Peppers 1.11 Sweet Potatoes

1.4 Carrots 1.8 Pumpkin

1.12 Gem Squash

2. News: current activities pertaining to the domestic & international fresh produce market

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INTRODUCTION

This report is a review of selected vegetable sales at the Cape Town Fresh Produce Market, the largest fresh

produce market in the Western Cape.

The review will be issued on a monthly basis and will cover trend analysis relating to prices (Rand per ton)

and volumes (tons) of the selected vegetables sold on the market, considered to be of importance due to

the area under production or marketed volumes, however the combination of selected vegetables might

change over time due to relevance.

OVERVIEW OF THE NATIONAL AGRICULTURAL MARKETING INFORMATION SYSTEM (AMIS), OFFERED BY THE

DEPARTMENT OF AGRICULTURE, FORESTRY AND FISHERIES (DAFF)

The Agricultural Marketing Information Systems (AMIS) is a database interface offered by the Department of

Agriculture, Forestry and Fisheries (DAFF).

The main purpose of the Agricultural Marketing Information System (AMIS) is to provide reliable & updated

information to farmers. In order to assist farmers to plan activities relating to production and marketing in a

much informed manner.

Agricultural market information is provided for horticulture, field crops, livestock and industrial products, and

includes the following categories:

marketing prices,

grading and standard information,

annual price trends, and

marketing news (pertaining to the application procedures for import and export permits).

Click on the following website link to access the DAFF AMIS web application, or alternatively go to the web

address: http: //webapps.daff.gov.za/amis (no subscription fee payable to access system). Cell phone user

can send an sms to *120*4040# (charged at standard sms rates)

Please note that prices are updated at 12h00 a.m on a daily basis.

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1. PRICE AND VOLUME TREND ANALYSIS

1.1 Potatoes

Figure 1: Potatoes sales on the Cape Town Fresh Produce Market

PERFORMANCE OF THE NATIONAL POTATOES MARKET

During October 2016, national average potato prices were expected to increase according to the ABSA

agribusiness commodity outlook, with further expectations of even more price increases during December

2016. The reason for the price increase comes after producers are unable to sufficiently supply and meet the

national demand of potatoes. Although potatoes prices were expected to reach between R5 and R6 per

kilogram, Mervyn Abrahams, the director of the Pietermaritzburg Agency for Community Social Action

(Pacsa) indicated that low-income households were expected to continue to buy the most popular

vegetables of which potatoes are the most common vegetable, which is generally used to thicken stews

(ABSA, 2016).

As a result of the non-delivery of early season rains and below-normal dam levels, the lack of sufficient water

for irrigation purposes might impact on the expected potatoes production output. Newly established

plantings require sufficient water allocation and rain fed plantings are dependent on early season rains, thus

producers in some areas opt to plant lesser in order to mitigate the degree of risk associated with the

uncertainty of rainfall (ABSA, 2016). This could ultimately result in a shortage in supply as well as smaller

potatoes sizes available on the market.

DEVELOPMENTS ON THE CAPE TOWN FRESH PRODUCE MARKET: OCTOBER 2016

A total of 8,493 tons of potatoes was sold during October 2016, priced at R4336 per ton. The quantity sold

increased by 15% m/m or 1123 tons compared to the previous month. Whilst the average price decreased

by 2% m/m or R104 per ton compared to the previous month.

On an annual basis, volumes were lesser by 11% y/y or R1013 per ton compared to the same period in the

previous year. On the other hand the average market price soared by 56% y/y or R1560 per ton, for the same

period in the last year.

1 bag of potatoes equals 10 kilogram Source: Potatoes SA & Technofresh, 2016

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1.2 Onions

Figure 2: Onion sales on the Cape Town Fresh Produce Market

1.3 Tomatoes

Figure 3: Tomatoes sales on the Cape Town Fresh Produce Market

Tomatoes marketed during October 2016 reached 2,484 tons at an average price of R8175 per ton.

This equates to a 4% m/m or 88 ton increase in volumes compared to the previous month. Average

monthly prices continued on an increasing trend and further escalated by 18% or R1252 per ton

during October 2016 as a result of lesser volumes supplied to the market.

On an annual basis, sales volumes was higher by 2% y/y or 60 tons compared to the same period in

the previous year whilst the average market price per ton was lesser by 3% y/y or R283 per ton.

The volumes sold during October 2016 amounted to 2.690 tons, whilst the average price obtained

per ton of onions reached R3473 per ton. Volumes increased by 28% m/m or 580 tons compared

to the previous month, whilst the average price per ton further decreased by 23% m/m or R1015

per ton. This could be attributed to an increase in supply levels which seem to be more than what

the uptake (i.e. demand) in the market was.

On an annual basis, sale volumes increased by 4% or 112 tons compared to the same period in the

previous year. Average market prices obtained during October 2016 obtained 15% y/y or R463 per

ton more than the same period last year.

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1.4 Carrots

Figure 4: Carrots sales on the Cape Town Fresh Produce Market

1.5 Cabbage

Figure 5: Cabbage sales on the Cape Town Fresh Product Market

Cabbage sale volumes reached 635 tons during October 2016, indicating a 1% m/m increase in the

volumes supplied to the market in relation to the previous month. Irrespective of the small increment,

monthly volumes supplied to the market are still on an increasing trend and thus it could be attributed

to the oversupply of cabbage in the market. Consequently, the average market price per ton

amounted to R1752 per ton which is a 4% m/m or R81 per ton lesser than the previous month.

If compared to the same period in the previous year, volumes sold on the market were higher by 16%

y/y or 88 tons whilst the average price obtained remained more or less unchanged with a 1% y/y or

R20 per ton increase for the period under review.

Carrot volumes sold during October 2016 increased by 3% m/m or 22 tons during October 2016, thus

reaching 875 tons in total. The average market price per ton further decreased by 8% m/m or R 202

per ton and reached R2404 per ton during October 2016. As stock levels to the market recovered

from May/June 2016, the average market price charged per ton started to systematically decrease

on a monthly basis.

On an annual basis, the volumes sold on the fresh produce market increased by 16% y/y or 118 tons,

whereas the average market price per ton decreased by 2% y/y or R54 per ton. Although volumes are

higher than October 2015, average market prices more or less reached the same price levels if

compared to last year.

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1.6 Butternut Squash

Figure 6: Butternut sales on the Cape Town Fresh Produce Market

1.7 Peppers

Figure 7: Pepper sales on the Cape Town Fresh Produce Market

Butternut Squash volumes reached 583 tons in sales during October 2016, at a price of R6436 per ton.

Sale volumes decreased by 44% m/m or 463 tons compared to the sales obtained in the previous

month of September 2016. Due to the shortage in supply, average market prices increased by more

than 100% m/m or R3300 per ton, reaching R6436 per ton compared to the R3135 obtained per ton

sold in the previous month.

Sale volumes was however lower by 17% y/y or 118 tons compared to the same period within the

previous year, whilst average market price soared by 73% y/y or R2706 per ton for the period under

review.

Pepper volumes sold during October 2016 amounted to 563 tons. This demonstrates a volume

increase of 13% m/m or 67 ton increase in relation to the previous month. Although the monthly sale

volume has increased, the average price responded indifferently as it further increased by 32% m/m

or R3808 per ton and subsequently reached R15791 per ton.

On an annual basis, volumes supplied and sold on the market remained unchanged at 563 tons,

whilst the average market price per ton of peppers increased by 11% y/y or R1565 per ton compared

to the same period in the previous year.

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1.8 Pumpkin

Figure 8: Pumpkin sales on the Cape Town Fresh Produce Market

1.9 English Cucumber

Figure 9: English Cucumber sales on the Cape Town Fresh Produce Market

Pumpkin volumes sold during October 2016 amounted to 393 tons, which represent a 41% m/m

decrease in volumes sold compared to the 669 tons sold in the previous month. As a result of lower

stock levels resulting from limited supply, average market prices increased by 74% m/m or R1539 per

ton and subsequently reached R 3620 per ton.

On an annual basis, volumes sold are more or less unchanged as it increased by a mere 4 tons

compared to the same period in the previous year. Due to higher demand accompanied by limited

supply, average market prices has moved upwards by 45% y/y or R1125 per ton.

English cucumber volumes amounted to 350 tons during October 2016, translating to a 21% m/m or 60

ton increase in volumes compared to the previous month. Whilst the average price per ton obtained

R5882 per ton, which is 36% m/m or R3275 lesser per ton of produce sold during the previous month.

On an annual basis, volumes sold during the month under review obtained 2% y/y or 8 tons lesser

compared to the sales obtained in the same period within the previous month. Average market prices

are however lower by 7% y/y or R430 per ton compared to average market prices obtained during the

same period last year.

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1.10 Lettuce

Figure 10: Lettuce sales on the Cape Town Fresh Produce Market

1.11 Sweet Potatoes

Figure 11: Sweet potatoes sales on the Cape Town Fresh Produce Market

A total of 347 tons was sold during October 2016, compared to the previous month in which 3% m/m or

13 tons more lettuce was sold. Regardless of lesser stock levels, the average market price decreased by

R36 per ton (1%) and reached R2982 per ton.

On an annual basis, volumes declined by 23% y/y or 102 tons compared to the same period in the

previous year. Whilst the average price obtained per ton of lettuce was 47% y/y or R947 per ton higher

compared to the same period in the previous year.

Sweet potatoes volumes reached 265 tons at the end of October 2016, which demonstrates a 19%

m/m or 63 ton decrease in relation to the previous month. Consequently the average market price

per ton of sweet potatoes continued on an upward trend, as it further increased by 24% m/m or

R1285 per ton.

On an annual basis, volumes were lower by 40% y/y or 175 tons in relation to the same period in the

previous year. Lower supplies during October 2016 mainly contributed to the 84% y/y or R3044 per ton

market price increase in relation to the same period last year.

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1.12 Gem Squash

Figure 12: Gem squash sales on the Cape Town Fresh Produce Market

Gem squash stock sold during October 2016 amounted to 199 tons, which translates to an 11% m/m or

19 ton increase in sale volumes compared to the previous month. The monthly average price per ton

subsequently underwent downward pressure and declined by 15% m/m or R903 per ton compared to

the same period in the previous year.

On an annual basis, volumes sold on the market declined by 49% y/y or 190 tons compared to the same

period in the previous year. Whilst the average price obtained per ton of produce reached 85% y/y or

R2288 more per ton of gem squash for the same period under review.

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TABLE 1: TREND ANALYSIS OF NICHE VEGETABLES TRADED ON THE CAPE TOWN

FRESH PRODUCE MARKET:

PRODUCE NAME: ( in order of the highest to

lowest volumes sold during this

month)

AVERAGE TONS

TRADED FOR

OCTOBER 2016:

(tons)

(A-Z)

CHANGE IN THE

AVERAGE TONS

TRADED FOR

OCTOBER 2016:

(m/m)

AVERAGE PRICE

OBTAINED FOR

OCTOBER 2016:

(Rand per ton)

CHANGE IN THE

AVERAGE PRICE

MARKETED FOR

OCTOBER 2016:

(m/m)

13. Cauliflower 264 10% R3 982 -27%

14. Baby Marrow 128 12% R13 020 -1%

15. Green beans

100 8% R12 700 -26%

16. Broccoli 91 -18% R8 399 3%

17. Beetroot 82 3% R3 686 -

18. Brinjals

/Eggplant 70 -6% R8 553 12%

19. Hubbard Squash 42 >100% R2 414 -44%

20. Sweetcorn 35 -7% R19 473 21%

21. Spinach 34 -29% R7 497 -2%

22. Leeks 17 -15% R3 543 -16%

23. Spring Onion 16 24% R9 220 -17%

24. Mushrooms 10.3 31% R48 984 24%

25. Patty Pans 2.4 >100% R19 158 -25%

26. Radish 1.5 5% R6 314 -14%

27. Marrow 0.03 -84% R6 219 -54%

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NEWS CLIPS: COMMODITY MOVEMENTS BOTH IN THE INTERNATIONAL AND DOMESTIC MARKET

2.1 South Africa is the fourth largest non-EU supplier: EPA between EU and five African countries comes

into force

The European Union (EU) and the Southern African Customs Union (SADC) Economic Partner Agreement

group took more than a decade to reach finalisation, according to the Trade Law Centre (Tralac, 2016).

The Agreement was signed by EU representatives and the five SACU member states which include

Botswana, Lesotho, Namibia, Mozambique, South Africa, Swaziland and Angola as well as Mozambique

on 10 June 2016. Although Angola did not sign the agreement, it formed part of the negotiations and

may join the other SACU members at any time in future (Fresh Plaza, 2016).

On the 10th of October 2016, the signed Economic Partnership Agreement (EPA) between the EU and five

Southern African countries, i.e. Botswana, Lesotho, Namibia, Swaziland and South Africa came into

effect. South Africa stands out as one of the EU's main supplier of fruits and vegetables, and is ranked as

the fourth largest non-EU supplier.

In 2015, imports by the EU from South Africa amounted to 1, 2 million tons; which demonstrated an 11%

growth compared to 2014. A total of 12,213 tons was allocated to vegetables and 1, 2 million tons to fruits

under the following Harmonised system tariff headings:

HS0804 - dates, figs, pineapples and avocados: 52,523 tons

HS0805 - citrus: 654,466 tons

HS0806 - table grapes: 232,643 tonnes

HS0807 - melon, watermelon and papaya: 1,718 tonnes

HS0808 - apples and pears: 196,470 tonnes

HS0809 - stone fruit: 50,063 tonnes

HS0810 - other fresh fruits: 13,794 tonnes (Fresh Plaza, 2016).

In the same year, EU imports from Swaziland amounted to 7,393 tons, amounting to 8% more than in 2014,

with citrus being the largest exporting fresh produce product at 7,230 tons. Namibian imports amounted

to 19,055 tons during the same period under review, demonstrating a 7% decrease in imports to the EU.

Citrus fruit exports to the EU from Namibia amounted to 19,012 tons, which is also the largest fresh

produce product exported.

“ The main points of the Economic Partnership Agreement (EPA), which grants access to the EU fruit and

vegetable market and has entered into force provisionally, are as follows:

Use

For the majority of fruits, customs duties are eliminated from the moment when the agreement

comes into force, although there are significant exceptions for sensitive products due to their social

and economic importance, including bananas, some citrus fruits, apples and pears.

The entry price system is also maintained for all these products, removing the ad valorem tax and

keeping the specific one, if the import price falls below a certain level, which varies by product and

period.

For vegetables, customs duties are also eliminated from the moment the agreement comes into

force, with the exception of cauliflowers (HS070410), head lettuces (HS070511), celeriac

(HS07069010), peas (HS07081000) and beans (HS07082000).

The entry price system is also maintained for tomatoes (07020000), cucumbers (07070005), artichokes

(07099100) and courgettes (07099310).”

Source: Fresh Plaza, 2016

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2.2 Announcement of the 2017/18 Department of Trade and Industry (DTI) National Pavilion List

Click here to view the 2017/18 National Pavilion list.

The contact details of the DTI officials are provided at the end of the pavilion list, should you have any

further enquiries.

2.3 Final prohibition on the use of certain EU names of products: SADC-EU Economic Partnership

Agreement

The South African Government has issued and published under

Government Notice No. 66 of 2014 in the Government Gazette number

37296 on 4 February 2014, in which public comment was requested on

provision of protection under Section 15 of the Merchandise Marks Act to EU

agricultural product and beer GI (geographical indications) names listed in

the aforementioned government notice (DTI, 2016).

Subsequently, on 21 October 2016, a Final Notice was issued and published

under Government Gazette Notice No. 1303 of 2016 in the Government

Gazette number 40359 which now prohibits the use of the listed EU

agricultural product and beer names listed in the notice, other than the use

thereof by the producers of the products from the countries indicated in the

notice or any party in accordance with the Rules of Use published as an

annexure to the Final Notice. Click here to view the Notice as published

(DTI, 2016).

The agricultural products and beers names as well as a description thereof

together with the Rules of Use applicable can be viewed by clicking on the

below links:

Fruit, vegetables and cereals fresh or processed

Cheeses Part 1

Cheeses Part 2

Meat Products

Olive oil

Fisheries Products

Beer

o Ceske pivov

o Ceskobudejovicke pivo

o Bayerisches Bier.

o Bremer Bier

o Munchener Bier

Other Products

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2.4 Important Notice: Greening in Potatoes

Greening is currently a major reason for downgrading on National Fresh Produce Markets. During August

and September 40.13% of all downgrading on National Fresh Produce Markets was due to greening. For

Class 1 no greening is allowed. For Class 2 greening may not be more than 10% of the surface of the

tuber and may not be deeper than 2mm. Most potatoes with greening are therefore downgraded to

Class 3. Also see PROKON Document on greening A1 on

http://www.prokonsa.co.za/Potato%20defects.html (Potatoes SA, 2016).

Greening is caused by tubers exposed to light. Greening cannot be reversed by keeping them in the

dark.

Prevention strategy against greening in potatoes

During sorting:

Reduce the speed of the sorting conveyer belt so that employees can remove tubers with greening.

Before harvest:

Irrigate to flush close small soil cracks or ridge to close big cracks. Do not keep tubers in the soil for too

long if greening is a risk.

During the growing season:

Avoid high nitrogen application, especially in cultivars that form long stolons. Also refer to the factsheet

on greening at www.potatoes.co.za/research/factsheets/fisiologiese-knolafwykings

For any enquiries regarding greening contact Dr Fienie Niederwieser (fienie@potatoes.co.za ) or Terence

Brown at (asa@piketberg.net ).

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2.5 WEATHER UPDATE: DAFF NAC ADVISORY ON THE 2016/17 SPRING SUMMER SEASON, OCTOBER 2016

Below-normal rainfall was received in most parts of the country, and dry conditions continue in many

areas with water restrictions imposed in some parts. Livestock is in reasonable to good condition due to

the provision of supplementary feed; even though conditions remain in poor condition in some parts.

Land preparations for summer crops are underway in some summer producing areas. Veld conditions are

slowly recovering in some areas following rainfall. Incidents of frost which resulted in damages in the fruit

industry have been reported in the Western Cape while incidents of veld fires have been reported in Free

State. In the Eastern Cape livestock mortalities have been reported, as well as 1Stalk Borer on maize. The

levels of dams are lower than the previous year in all provinces.

The Western Cape Province received above-normal rainfall along most coastal areas, including the north

western area of the West Coast and the Klein Karoo. However the south western parts received below-

normal rainfall. The Central Karoo obtained mostly extremely below-normal rainfall. Monthly mean

temperatures remained reasonably normal. Winter cereal crops are normal to above-normal due to the

timely spread of rainfall over the growing season, therefore maintaining optimal growing conditions.

During October 2016, irregular incidents of frost damage affected the fruit industry in the Early Warning

Unit, CCDM 4 Touwsriver area. The average level of major dams within the Western Cape has decreased

to 62% as at 17 October 2016 compared to the 71% obtained during the same period in 2015.

Click here to view the most recent update (latest update on 07 November 2016) on the dam levels within

the Western Cape Province or alternatively visit the Elsenburg Website at www.elsenburg.com and revert

to Agri-tools Western Cape dam levels.

In addition, the Agri-outlook report provides a holistic overview of the provincial weather developments

within a specific month. The reports can be viewed on here, or alternatively visit the Elsenburg website at

www.elsenburg.com and revert to the Agri-tools Agri Outlook.

Source: DAFF National Agro-meteorological Committee (NAC) Advisory & Provincial Department of

Agriculture, 2016.

1 Refer to the Grain SA website, to read more on Stalk Borer and the control thereof: http://www.grainsa.co.za/key-

aspects-of-stalk-borer-control

A comprehensive list of strategies can be found in the monthly NAC Advisory report issued by DAFF:

Climate Change and Disaster Management. It can be accessed from the following websites:

www.daff.gov.za and www.agis.agric.za.

Request weather warning notifications from the Western Cape Department of Agriculture: Sustainable

Resource Management, Disaster Risk Management

Forward an email to Mrs. Zaibu Arai to ZaibuA@elsenburg.com or alternatively call (021) 808 5368.

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Source: Department of Energy, 28 October 2016

2.6 MONTHLY FUEL PRICE ADJUSTMENTS EFFECTIVE AS FROM WEDNESDAY, 02 November 2016

The following reasons were highlighted for the fuel price adjustments in November 2016:

The Rand appreciated against the US dollar for the period under review, which is from 30

September 2016 to 27 October 2016 when compared to the previous period under review.

The ZAR/USD exchange rate changed slightly for the period under review, appreciated from

R14, 01 to R13, 96 which led to a decrease in the contribution to the Basic Fuel Price on petrol,

diesel and illuminating paraffin by 1.70 cents per litre, 1.67 cents per litre and 1.65 cents per

litre respectively (DoE, 2016).

The global price of petrol, diesel and illuminating paraffin has increased, as well as that of

crude oil (Fin24, 2016).

Product description Numeric adjustment

applicable to the

Coastal parts in

South Africa

(cents per litre)

Price adjustment description Average price

applicable to the

Coastal parts in South

Africa

(cents per litre)

Petrol 93 ULP 45.00c cents per litre increase in retail price 1241.00

Petrol 95 ULP & LRP 45.00c cents per litre increase in retail price 1257.00

Diesel 0.05% Sulphur 63.00c cents per litre increase in wholesale price 1134.87

Diesel 0.005% Sulphur 63.00c cents per litre increase in wholesale price 1138.27

Illuminating Paraffin

(Wholesale)

57.00c cents per litre increase in wholesale price 672.03

Illuminating Paraffin (SMNRP) 76.00c cents per litre increase in the Single

Maximum National Retail price (SMNRP)

934.00

Maximum Retail Price for

LPGAS

59.00c cents per kilogram increase in the

maximum retail price

R7, 399.40 per metric

ton or 410.67 cents per

litre.

( refinery gate)

LPG for residential

customers is derived as

per the control sheet

per kilometre.

16

ACKNOWLEDGMENTS

The following institutions and organisations are hereby acknowledged:

ABSA Agribusiness: https://www.absa.co.za/business/sector-solutions/agribusiness/trends-and-

reports/

Department of Agriculture, Forestry and Fisheries: www.daff.gov.za

Department of Energy: www.energy.gov.za

Department of Trade and Industry: www.dti.gov.za

Elsenburg (Western Cape Department of Agriculture): www.elsenburg.com

Fin24: www.fin24.com

Fresh Plaza: www.freshplaza.com

Potatoes South Africa (SA): www.potatoes.co.za

Techno Fresh CRM: www.technofresh.co.za

Trade Law Centre: www.tralac.org

For more information, contact:

The Western Cape Department of Agriculture

Programme: Agricultural Economic Services

Division: Marketing and Agribusiness

Tel: 021 808 5193 or 5189

Fax: 021 808 5210

E-mail: michellesw@elsenburg.com

DISCLAIMER:

This document and its contents have been compiled by the Western Cape Department of Agriculture.

The views expressed in this document are those of the Department of Agriculture with regard to

vegetable market information in the province, unless otherwise stated. Anyone who uses this information

does so at his/her own risk. The Department of Agriculture or the author(s) therefore accepts no liability

for losses incurred resulting from the use of this information.