SOUTH AFRICA – Hapag-Lloyd, the Hamburg-based shipping giant, is expanding its operations to include the ports of Durban and Ngqura.
This new development is a significant outcome of a collaborative effort spearheaded by various fresh produce associations, including the Citrus Growers Association (CGA), aiming to address the challenges faced by citrus growers in the region.
Scheduled to be operational by the end of May, just in time for the peak of the 2024 citrus season, the service is expected to run until September.
This expansion comes at a critical juncture for the citrus industry, which has grappled with issues affecting profitability, notably high shipping rates identified in a 2022 study by the Bureau for Food and Agricultural Policy (BFAP).
The study revealed that four out of five citrus growers experienced losses, emphasizing the urgency for intervention.
According to Chadwick, writing in his weekly newsletter, the CGA played a pivotal role in facilitating Hapag-Lloyd’s entry into the South African citrus market.
The collaboration with the shipping giant is geared towards enhancing both capacity and competition, essential elements for the long-term sustainability of the sector.
Chadwick emphasized, “Recent shipping price spikes, attributed to attacks on vessels in the Red Sea and drought-related complications affecting the Panama Canal, have exposed the vulnerability of fruit exporters to fluctuating shipping rates.”
“Any measure that introduces stability and competition into the shipping market is considered a positive step forward by the CGA.”
The CGA sees the collaboration with Hapag-Lloyd as an opportunity to mitigate the impact of shipping challenges, allowing South Africa to potentially increase citrus exports by 20 million 15-kilogram cartons. This could be achieved through improved market access and streamlined logistics.
Chadwick stated, “Apart from maintaining market competitiveness and flexibility, a new entrant like Hapag-Lloyd is crucial considering the projected significant increase in citrus yield over the next few years. The citrus industry, and the broader economy, require expanded access to shipping.”
The CGA has set an ambitious goal to export an additional 100 million cartons by 2032, building on the momentum of last year’s achievement of exporting 165.1 million cartons.
The collaborative efforts between the CGA and Hapag-Lloyd represent a proactive step towards securing the future of South Africa’s citrus industry and bolstering its position in the global market.
As South Africa braces for increased citrus production, this strategic partnership lays the groundwork for a more resilient and competitive export infrastructure, providing a positive outlook for the industry’s growth and sustainability in the years to come.
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