New export markets offer hope for South Africa’s canned fruit industry

SOUTH AFRICA – Access to new export markets like China and India could revive South Africa’s declining canned fruit industry, which exports 85% of its products annually according to new research at Stellenbosch University.

The research was conducted by Dr. Heinrich Jantjies, Group Risk, Safety, and Security Director at Tiger Brands, one of the two companies operating canneries in the region.

The Western Cape’s canned fruit industry, a significant player in South Africa’s agricultural export sector, has experienced a worrying decline in competitiveness since 2016.

Dr. Jantjies’ research, part of his PhD studies at Stellenbosch University, reveals that the industry’s competitiveness rating, based on the relative trade advantage (RTA) formula, has dropped from 23.03 in 2016 to 17.02 in 2020.

This decline poses a threat to the industry, which employs over 7,500 people in the Western Cape.

Despite the challenges, Dr. Jantjies sees potential in exploring new export markets such as China and India.

He believes these markets could help arrest the industry’s downward trend and enhance its global competitiveness. “The industry has a strong and resilient character,” Dr. Jantjies says, citing the sector’s well-developed infrastructure, access to international markets, and the availability of renewable energy as key strengths.

In 2021, the canned fruit industry’s export value reached USD 112 million, with canned peaches leading at USD 47.6 million.

This was an increase from USD 94.7 million in 2002, though still below the peak of USD 186.2 million in 2010. Pears have been an exception in the overall decline, with their RTA improving from 33.96 in 2016 to 40.40 in 2020.

The canned fruit sector’s challenges are not limited to market competition. Dr. Jantjies points to several factors that constrain the industry’s competitiveness, including a lack of innovation in canning technology, local market sales, and the potential impacts of climate change on fruit yields.

Additionally, negative perceptions about the health benefits of canned fruit and concerns over land expropriation without compensation further threaten the industry.

However, Dr. Jantjies emphasizes that a collaborative effort between the industry and government could develop a recovery plan for the country’s valuable deciduous fruit canning industry.

“It commands a leading position in South African agribusiness and supports growth in foreign exchange earnings, employment, and rural development,” he notes.